The most reassuring part of the presentation was an answer to a question at the end on lifting costs. Arabella can ride out these lower prices on WTI--my read anyway.
The presentation replay is available on the company's website, though they don't make it easy to find--why I can't figure.
It was a good presentation. Jason started putting the Arabella acreage together during the 2008 downturn to $38 Bbl so he's not a babe in the woods during a CL depression and knows that more land opportunities can result.
FREDERICK, Md., Dec. 22, 2014 /PRNewswire/ -- U.S. Silica Holdings, Inc. (SLCA) announced today that its Board of Directors has authorized an increase in the Company's share repurchase program from $25 million to up to $50 million. The repurchase program will be funded over the next twelve months using the Company's available cash.
"The decision to upsize our stock repurchase program reflects our confidence in U.S. Silica's long-term strategy and growth prospects as well as a commitment to delivering increased value to shareholders," said Bryan Shinn, president and chief executive officer. "We remain focused on using our strong balance sheet and cash flows to continue investing in organic growth initiatives and other high-return business development activities that create value for our shareholders."
It will depend on the forward strip as to what the acquirer would pay for a bolt on. Cooke had better cooperate to get this done in February when the cold influences the strip, not wait and suffer during shoulder season or later.
I suppose we'll have to wait for January and the end of tax selling to see a more efficient quote on the common. Let's hope it's a big public player so getting stock might help us recover over the long term. A cheap cash out to a private player would be the lesser outcome.
I like the 29-30 cent area better than your 25 cent forecast. You have to figure Blackstone is going to arrange a shotgun marriage for SARA with somebody else already operating in S. LA adjacent to the SARA properties who has capacity and capital. Give another capable entity the forbearance, not Cooke and Clifford. To think that they are just now deciding between employees and outsourcing, for example, blows me away. Bolt this on to somebody who has existing staff.
The First Lien Notes ($54.6M) mature on December 31, 2015, and interest, accruing at 10% per annum, is payable on the First Lien Notes on March 31, June 30, September 30 and December 31 of each year, commencing December 31, 2013.
The Second Lien Notes ($125.2M) mature on July 1, 2016, and interest is payable on January 1 and July 1 of each year.
I suppose Cooke and Clifford have thru approx. 1Q15 to demonstrate they can operate profitably, assuming they can make the interest payments on time.
This utility already has a deal for NG in Oklahoma that's about three years old. This would be their second deal.
We seem to have a breather from the debt holders but we need to see the financials for Q4 (the first clean quarter) to know how viable this really is. Whether these two bozos are the right team to drive this clown bus is another question, but perhaps the debt holders will resolve this for us.
If Brent would simply stabilize, even at $60, the explorers around the world will adjust to that $60 and drill. RIG will get its share of the work, always have, always will. The dividend will adjust if need be. I think you buy this at $18, write some calls to earn some premium while you wait to see the impact of the stabilization at $60. If Brent falls to $50, you have another decision. This is my approach anyway.
SYRG is attracting a lot of attention lately for their success in the DJ/Wattenberg. Several Street analysts have placed it on to their best stocks list for 2015. SYRG said today they are increasing their 2015 CAPEX, not cutting like most other E&Ps.
BBG is in this same play. Is SYRG in the sweet spot and BBG is not, or is Mr. Market overlooking BBG? SYRG is pretty much a one trick pony for the DJ, whereas BBG has Utah. Usually analysts like some diversity of plays, but not in the BBG case, I guess.
If your target for crude in the Bakken at the wellhead is $25, $2.50 might be about right. As Freud might have said, sometimes a target is just a target.
The world is one million barrels a day oversupplied. If demand won't grow in the non-OECD world to consume those surplus barrels, we'll have to see a formula for supply reduction and be able to verify it on a continuing basis. Merely exporting US light oil does nothing to relieve the problem and will not increase prices or restore drilling budgets. Except for refinery configuration where some percentage of sour crude needs to be imported and run in the US, oil is fungible and price sensitive to world wide supply-demand.