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Oil States International Inc. Message Board

noah_stock 5 posts  |  Last Activity: Feb 5, 2016 12:04 PM Member since: Oct 21, 1999
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  • Reply to

    Asset write down

    by noah_stock Feb 5, 2016 11:43 AM
    noah_stock noah_stock Feb 5, 2016 12:04 PM Flag

    Of course, a 5% decline on US land rig counts for January 2016 helps also!

  • Reply to

    Asset write down

    by noah_stock Feb 5, 2016 11:43 AM
    noah_stock noah_stock Feb 5, 2016 12:02 PM Flag

    Also, if the EUR/USD returns to its long term mean of 1.3, we will definitely be good! Even a return to the 1.2 range helps BBEP immensely.

  • noah_stock by noah_stock Feb 5, 2016 11:43 AM Flag

    If my calculations are correct, BBEP will need to write down assets about 1.36 Billion this last quarter (Q4 2015), so they are still above water, plus their hedge book would have gone up considerably. If oil stays at about $34 for April, then their next next write down will be about $1B, but again, their hedge book will have also gone up. So IMHO, they should be OK with their re-evaluation in April, but will be right up against the credit facility. October 2016 is the real test. If prices stay in the 30's its over. If it goes to $40-45 we should be OK. JMHO

  • Reply to

    1.10 is a good number to close today

    by choutony Dec 4, 2015 3:30 PM
    noah_stock noah_stock Dec 4, 2015 4:55 PM Flag

    BBEP isn't a shale producer.

  • noah_stock by noah_stock Dec 4, 2015 2:54 PM Flag

    By my calculations, if WTI stays at $40 at the end of December, the writedown on assets is round $700,000,000. This doesn't break the bank when comparing assets to liabilities. So, what I see is they conserving cash if the average barrel drops even lower for the 1st qtr. Given the dynamic of the percent of oil pumping planned, you may see BBEP lower their output to only enough to keep cash to run operations, then sell the extra hedges, and thus further improve the balance sheet with paying off debt or keeping cash and not having to draw on their credit line. If BBEP is a candidate for bankruptcy, nobody is safe, but at some point, you can't lose money pumping more oil OUT of the ground if it is worth more as an asset in the ground. This is a waiting game for sure; scary as hell for sure.

OIS
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