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Old Republic International Corporation Message Board

quantuon 47 posts  |  Last Activity: Jan 17, 2015 10:53 AM Member since: Mar 27, 2012
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  • Reply to

    2015 DCF projection at low oil and gas prices

    by bicepsbunny Jan 12, 2015 6:43 PM
    quantuon quantuon Jan 17, 2015 10:53 AM Flag

    possible - walker has proven to unit holders that he can be stingy...i think most unit holders are use to his failed promises

  • Reply to

    2015 DCF projection at low oil and gas prices

    by bicepsbunny Jan 12, 2015 6:43 PM
    quantuon quantuon Jan 17, 2015 10:50 AM Flag

    At $60/$3, i see them generating ~175-200mn in EBITDA depending on expense (surely cost will come down?). With about 100mn in interest/maint. that leaves roughly 80 dcf or 50% coverage. Oil at 50 puts coverage at 40%. One thing to remember there is a floor on ethane where its get rejected back into NG (methane) so in a sense this has become more a pure Ngas play..We seem to differ on our numbers - not sure why but Im pretty comfortable with my numbers as Ive been following and trading this name for the last few years and it fits the observed. The next month or so will be interesting. IMO the tail risk is to the right at this point. g/l

  • Reply to

    When will the dividend be announced?

    by coffeeteaorme39 Jan 16, 2015 5:03 PM
    quantuon quantuon Jan 16, 2015 5:36 PM Flag

    towards end of month or early feb

  • Reply to

    2015 DCF projection at low oil and gas prices

    by bicepsbunny Jan 12, 2015 6:43 PM
    quantuon quantuon Jan 16, 2015 5:33 PM Flag

    Typical decline curve would argue a production decline of the last five years of drilled wells on the order of 60% (simple averaging). At 9m bpd, that would imply a substantial drop if all drilling ceased instantaneously. Of course, some older wells in there too so I might argue production would decline by 4m bpd a year after drilling ficticiously ceased. Typical rig adds ~500bpd/month initial production or on average 3.5kbpd/year so that would imply about 1,200 rigs needed to run to maintain production (~45% decline). Drilling is getting more productive and core of core will get drilled so potentially can maintain production at 1000 rigs although I am a bit skeptical. But as you imply its the marginal barrel that is important for pricing and if we flatten out production with 1% consumption growth we should soak up the 1mn bpd's that is oversupplied although that oversupply number keeps going up as people need a rationalize the oil price move. My own opinion is that the guys who sold the hedges to the E&Ps for 2015 got into a typical short low delta put that crushed them and forced hedging...we shall see particularly re: NG....

  • Reply to

    2015 DCF projection at low oil and gas prices

    by bicepsbunny Jan 12, 2015 6:43 PM
    quantuon quantuon Jan 16, 2015 4:37 PM Flag

    i think an existing operator might be interested in the acreage in Carrol Co. for blocking up and offsets and its HBP with infrastructure in place....not sure it will happen but I could see them selling the 11k acres for 150. And UEO at 6-7x fwd ebitda for say 300 (or maybe sell half). Can't roll it over into anything great at today's prices - you need at least $60/$3.5 so that ebitda bump reduces leverage. But there are going to be some juicy bargains out there for an experienced operator with access to secured financing.

  • Reply to

    2015 DCF projection at low oil and gas prices

    by bicepsbunny Jan 12, 2015 6:43 PM
    quantuon quantuon Jan 16, 2015 4:31 PM Flag

    rig count down 13% last 8 weeks. falling off a cliff. will be down 50% given capex announcements. 80% 1year; 40% 2 year declines implies production will drop quick so not sure I would use today's price for '16. Be that as it may, I see about 1.25 in DCF in 2016 at spot prices so I don't get " Keep in mind if prices hold anywhere near this low, they would be able to pay little or nothing in 2016 due to weak hedging," they've got 40% NG hedged at 4. Bigger risk is this House of Saud move crushes the global economy leading to major demand destruction.

  • Reply to

    Hedging as percent of production volume?

    by donf22 Jan 16, 2015 1:18 PM
    quantuon quantuon Jan 16, 2015 2:03 PM Flag

    2015: NG 90%; OIL 100+%; NGL 0%; TOTAL: 73%
    2016: NG 40%; OIL 30%; NGL 0%; TOTAL: 31%

    Bear in mind that most, if not all, of their minor oil production (~10% of total) is from old mature wells (e.g., Clinton) that, on the plus side, have low declines (sub 5%) but, on the negative, they can't really throttle back production. Most of the NGLs are from the Barnett where they've focused rigs in the wet window. I expect them to throttle that back some and drill more dry (gas) wells going forward. They use to over hedge the crude as a way to hedge NGLs but stopped after 2013 cause differentials hurt them (too bad!)

  • Reply to

    2015 DCF projection at low oil and gas prices

    by bicepsbunny Jan 12, 2015 6:43 PM
    quantuon quantuon Jan 14, 2015 10:51 AM Flag

    FYI most of their production is the Barnett; def. too much debt - cud see a preferred deal or rights type offering with GP infusion....management has not made good decisions - even their own buys - here other than how to pay themselves. Guidance comes soon...they will shift spend into the dry window of Barnett and cut EF/AC and San Juan develop....much of their oil is from HBP mature verts - can't really stop flow there....then the Q is where is NG in '16/'17 - i'd like to know that one

  • Reply to

    Analyst Call/Meeting - Early 2015

    by richrd_cc Jan 14, 2015 7:39 AM
    quantuon quantuon Jan 14, 2015 10:35 AM Flag

    house of saud and CIC....shame that US put in all the effort but won't reap the reward...oh will better than debtor's prison i guess

  • Reply to

    ---MUST READ---

    by rbb40 Jan 12, 2015 8:39 PM
    quantuon quantuon Jan 13, 2015 4:10 PM Flag

    right - our gov't is gonna get their act together...the Saudi's are going to bankrupt the marginal players (the XCOs, SDs, and PWEs) along with the nouveau investors and then cash in some treasuries to supply financing and distressed buys and then let price rebound.... I do agree that our economy is going to take a whack later this year so prepare

  • Reply to

    2015 DCF projection at low oil and gas prices

    by bicepsbunny Jan 12, 2015 6:43 PM
    quantuon quantuon Jan 13, 2015 4:04 PM Flag

    sounds about right....$2.25 distribution and discipline on costs gets you thru (they do have ~25% NG hedged)....key is they can't keep paying themselves 75c/mcfe and have prod costs close to $2 at this level...they've never had to get down and dirty before but they are going to have to slash their paychecks along with unitholders.....if they can man up then we should hover at $20....

  • Reply to

    Storage spur for tankers? - TradeWinds

    by stjm99 Jan 7, 2015 10:07 AM
    quantuon quantuon Jan 9, 2015 3:56 PM Flag

    NAPPY is back! We should start hearing about "debt bombs" and "rusting buckets" and "beer bongs" pretty soon. Of course, he had to change his handle since we are up, lets see, 80% from when he was spewing his previous sell message at $3.50

  • Reply to

    Ominous...

    by johnp_0921 Jan 7, 2015 4:06 PM
    quantuon quantuon Jan 9, 2015 3:44 PM Flag

    buyvalue - don't just look at 10-k...EVEP is quite good at obfuscating the details and riding the legal thin line....read thru the actual amendments to the credit facility. Then you will see that, as it stands now, the covenant will revert back to 4.25-1 on total debt as of Mar 31, 2015.

  • Reply to

    Ominous...

    by johnp_0921 Jan 7, 2015 4:06 PM
    quantuon quantuon Jan 8, 2015 3:27 PM Flag

    buyvalue - you are looking at the senior secured cov. - there is also a total debt to ebitda cov which if they do not get another amend before March they will most likely violate....given the subdued view on prices, they should cut the dividend to the $2-$2.50 range.....now that the equity is too cheap for a secondary (what numbnuts - they could have issued high 30s a few months ago), a div and capex cut is all that is left.....fwiw - i actually bot a little here and yes, I know EVEP quite well....

  • Reply to

    NAPPY was right....

    by quantuon Dec 31, 2014 4:14 PM
    quantuon quantuon Jan 7, 2015 3:05 PM Flag

    good 2 see u r still around koz....looks like u r correct...Im sure yappy has changed his handle is on some other board spewing his venom....must be a sad way to make a living.... I think I mentioned previously that at 25k + rates, TNK is self sustaining - enuf to pay off the "debt-bomb" and buy new ships to maintain fleet age....

  • Reply to

    tanker rates per intertanko on 1/2/2015

    by brettshannon1 Jan 2, 2015 1:28 PM
    quantuon quantuon Jan 7, 2015 2:58 PM Flag

    Well hello Nappy!

  • Reply to

    NAPPY was right....

    by quantuon Dec 31, 2014 4:14 PM
    quantuon quantuon Dec 31, 2014 4:18 PM Flag

    but his "trade" three months ago to sell TNK and buy INTC - not too good...

    sayonara

  • quantuon quantuon Dec 31, 2014 4:16 PM Flag

    they will do a secondary when their debt covenants do not get amended...

  • only up 30% since Feb....didn't double my money (yet)

  • quantuon quantuon Dec 31, 2014 2:16 PM Flag

    liquids - crude +NGLs are ~30% of production with just oil hedged....that is why Walker engineered a take over of PDH (where he was on board) with the Kochs at $14...they stole it from retail as it would be worth $30 now with propane in the dumps...all the while he keeps giving himself shares of EVEP...hate to admit that JDT was right but this is a true POS and these guys are crooks...maybe it will bounce when the cut the dividend and do the secondary....

ORI
14.04-0.18(-1.27%)Jan 30 4:04 PMEST

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