Wouldnt you think we'd go higher with oil touching$106?
Z sells 1/2 its production for $80 barrel ... which limits profits but knowing that the OTHER half (sold on spot market) is where the gains can be made Q over Q ... you'd have thought the Street would move Z higher. Figure this next Q most of the oil sold on spot will be above $95+ so you'd think the Quarter distribution will be higher then last, right?
My understanding is that WHZ gets Cushing prices.
eia . gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=RWTC&f=D
We averaged the same price Q2 as we did Q1. We've broke $100 for all of three days. We'll need a lot more before it adds anything to the distribution.
Liz is right.
Per latest 10Q Floor / Ceiling $80.00/$122.50
"The collared hedges shown above have the effect of providing a protective floor while allowing Trust unit holders to share in upward price movements up to the ceiling. Consequently, while these hedges are designed to decrease exposure to price decreases, they also have the effect of limiting the benefit of price increases beyond the ceiling."
Are you sure? I haven't checked the hedging arrangements in a while but I thought they have collars which allow them to capture the current price of oil within the collar boundaries. I'm sure the current price is within those collars so if I am correct then WHZ should indeed benefit directly from higher prices.
Not sure whether the price they get is WTIC or some other benchmark though. And don't forget that a significant percentage is NG, it's not all oil.
I am new to WHZ, only initiated a small position today. I glanced through the latest 10-K. Gas revenue is not very significant, close to 9%. The oil price assumed in the PV-10 value is very conservative at a weighted average of 86.55. I like what I saw so far, will be glad to hear from others. :)