Energy production at Linn Energy has stalled in 2013, leading to inadequate cash flow generation in order to meet the $2.90 annual payout for investors.
Oil and gas production fell to 796 million ft³/day during the first quarter, below prior guidance of 827 million ft³/day. The company also restricted itself by stating it reviews cash distributions on an annual basis, rather than a quarterly one. This rigid policy makes a perceived financial shortfall more apparent.
LinnCO (NASDAQ: LNCO) board member Terrence Jacobs stepped in on May 30 and purchased 15,000 shares of Linn Energy for $34.20 per share. The total transaction value amounted to $513,000 when the stock was purchased.
Jacobs failed to catch a falling knife and restore confidence in Linn Energy’s flailing share price, as shares have fallen 15% further since the time of purchase. All in all, investor confidence in Linn Energy appears to be waning.
and that, as I tried to explain to this board a couple of months ago, is the problem. the new mexico leases they picked up from sandridge were nasty with contamination. remediation cost are eating linn's lunch, and those expenses will be an on-going concern for quite a while
yeah, I remember when somebody called Linn a "serial acquirer" in an article, as if there's something wrong with MLPs doing acquisitions. (Don't remember who wrote that). That's how MLPs grow. It's standard practice for MLPs to acquire mature oil fields with low decline rates.