Singling out PGH for not generating free cash flow is a bit of a cheap shot, given the price per barrel the majors (esp. CVX, COP, BP) require to self fund cap ex & dividends. See today's post on Zero Hedge. Here is a snippet (not including the very good graph):
Given the dramatic drops in gold and oil prices over the past few trading sessions, we thought it worth examining which miners and oil producers were most 'at risk' of generating negative cash flows at current and long-term prices. Goldman Sachs looks at 40 oil producers and 25 gold mines to create a complete 'cost curve' in terms of the best indication of what it actually costs to keep operations running. It is quite apparent that ~$85 Crude and ~$1150 Gold are key to the ongoing support for these industries.
I don't remember seeing PGH was also mining Gold but who knows what mineral wealth they have under the tundra. I will say that NG has popped a lot from 1QRT 2012 when it hit a low of 1.99? Now over 4.30? So a decrease in oil of $10.00 in the last two weeks is not going to kill PGH. PGH five years ago was a play on NG prices as they HAD to pay out free cash flow like a REIT. They are a corporation and not a Royalty set up and the div at .04 is far below the old div of like .22 a month ( NG was over 10.00 also). Thus I just don't see a danger to the DIV or a big issue with cash flow ( Now if Oil dumps to below $70.00 that could change that).
The Saudi's still have the hammer, they may have lost the control over upswing in prices but not down swings, they need ninety bucks a barrel to break even, I'm sure they are thinking about slowing down production, if they haven't already.