Replies to This Discussion

Permalink Reply by Black Gold Junkie on June 4, 2012 at 5:03pm

Now thats very interesting...I just saw two people from Texas @ the Ashland County Courthouse today...was there any correlation..I don't know, but something is going on. CHK. might not be Devon's competition...but somebody will be! It will take a big player to buy up that amount of acreage...and big players won't bite without hard evidence on data...which I'm sure CHK has. I wonder why they didn't include Richland County?

Permalink Reply by Marcus Grayson on June 4, 2012 at 9:38pm

I think they didn't include Richland because they already assigned most (if not all) of their leasehold to Devon.  I'm waiting for Anadarko to come up your way.  It just shocks me that all of the majors are just ceding the entirety of the western/southwestern part of the oil window to DVN.  How brilliant will DVN look when they get good production numbers while everyone else is spending like drunken sailors in the rest of the state?

Permalink Reply by Black Gold Junkie on June 4, 2012 at 9:43pm

I can't speak for Wayne County, but in Ashland County most of CHK's holdings are part of the gas storage area that they purchased from Columbia gas that are all HBP.

I wish I new the answer to that trivia...the only thing that keeps popping into my mind is that maybe they have advanced horizontal drilling methods from George Mitchell that no other driller has at this time...I mean they do extract oil from cracked kergon with steam.

oh..and I hope those sailors have a few more shipouts before they move this way.

Permalink Reply by Bluflame on June 5, 2012 at 9:08am

Marcus,

  In my opinion, many O&G companies haven't yet perfected the way to maximize horizontal shale well oil production. I think I remember reading in a Devon announcement that they believe they've devised a method of opening and retaining the openings in the shale crevices to promote oil flow.   Although it seems to be more of a fracking issue.

  Maybe that explains why Devon has become a factor in the oil region???

BluFlame

Permalink Reply by JODI on June 5, 2012 at 9:13am

Fellas, can any of you access the Meagher packet? I was curious to CHK leases in Licking. The leases are old Columbia Natural Resource leases that are hard to determine if they are still active. Thankd

Permalink Reply by Black Gold Junkie on June 5, 2012 at 5:16pm

JODI, sorry... it takes a sign in and of course you'll pay for the packet ...go to the Licking County Recorders office and search on there web page...most of the leases through Chesapeake are either released or are lease extensions.

Permalink Reply by JODI on June 6, 2012 at 4:37pm

yea, i tried. nothing. just one extension signed this year. i assume all the old cgas leases and enervest leases are now CHK. thats the only way they could have 4000 plus acres here.

Permalink Reply by Ron XXXXXX on June 5, 2012 at 10:24am

from what I heard CHK is overleveraged right now so they need to sell off some things to raise some cash,

they are a little short on cash right now

there will be some restructuring with the company but next year at this time watch their stock take a huge jump

from near $17 now to way over $28 maybe $30 or even $50

Permalink Reply by Marcus Grayson on June 5, 2012 at 10:42am

They have a ~$12 billion debt to service, their corporate bonds are rated at junk status (BB+), their best assets are in nat gas, they're out of hedge for 2012, which means they are subject to the market and their production numbers have been underwhelming in most of their major plays.  There is no reason to believe that their stock is worth $30 let alone $50.  If they slip much further they're an excellent takeover target by a real, actual major.

Permalink Reply by Black Gold Junkie on June 5, 2012 at 11:16am

Correct Marcus...but they just received around $4 billion from Goldman Sachs & The Jefferies Group as a unsecured loan, and they have a lot of unproven reserves on the books...a few more hogshooter plays and that 12 billion debt disapears pretty fast because of mark-to-market accounting practices...at least on the books. And just because a company may not be worth $30..$40..$50...doesn't mean there stock won't get there for a short period of time...ride the wave my friend.

Permalink Reply by Ron XXXXXX on June 5, 2012 at 11:18am

AFTER they restructure (by next year) I think there will be reason for their stock to be at $30 or $50

Permalink Reply by Marcus Grayson on June 5, 2012 at 1:50pm

I rode the wave once already, BGJ.  I sold at $32 and took my gains.  Then I shorted at ~$21 and covered it at ~$16.  I should have waited to cover a little longer, it would have been around $15, but I was too scared to be greedy.  Mark-to-market only works if the SEC doesn't investigate your claims of EUR.  If they did then CHK would be in serious trouble.

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