Author Topic: PWE - Penn West Petroleum  (Read 505368 times)

Joe689

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Re: PWE - Penn West Petroleum
« Reply #1520 on: September 15, 2019, 05:27:02 AM »
With half the saudi production offline for undetermined amount of time, what will oil spike to with the  new deficit, and more so risk premium.

OBE is only 15 percent hedges and fully torqued to oil by way of leverage as well.

Oil prices affect EV.  OBE is 80% debt, 20% equity.    Going from a company that might to BK to company printing cash could affect EV by double.  An EV double means equity moves 5x. 

If oil spikes hard, look for a multibagger here.  They will hedge as much as the can and save the company.  Most companies have 50% hedged and much less capital structure leverage


yzstevie

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Re: PWE - Penn West Petroleum
« Reply #1521 on: September 15, 2019, 06:52:41 PM »
With half the saudi production offline for undetermined amount of time, what will oil spike to with the  new deficit, and more so risk premium.

OBE is only 15 percent hedges and fully torqued to oil by way of leverage as well.

Oil prices affect EV.  OBE is 80% debt, 20% equity.    Going from a company that might to BK to company printing cash could affect EV by double.  An EV double means equity moves 5x. 

If oil spikes hard, look for a multibagger here.  They will hedge as much as the can and save the company.  Most companies have 50% hedged and much less capital structure leverage

It all depends on how fast SA can repair the damaged facilities right?  If they get everything sorted out in 1 week or 2 weeks, then the oil price will quickly come back down? 

tombgrt

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Re: PWE - Penn West Petroleum
« Reply #1522 on: September 16, 2019, 10:58:06 AM »
With half the saudi production offline for undetermined amount of time, what will oil spike to with the  new deficit, and more so risk premium.

OBE is only 15 percent hedges and fully torqued to oil by way of leverage as well.

Oil prices affect EV.  OBE is 80% debt, 20% equity.    Going from a company that might to BK to company printing cash could affect EV by double.  An EV double means equity moves 5x. 

If oil spikes hard, look for a multibagger here.  They will hedge as much as the can and save the company.  Most companies have 50% hedged and much less capital structure leverage

My CRC leaps aren't doing all that bad either. 250% move in a day ain't bad at all.

Liberty

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Re: PWE - Penn West Petroleum
« Reply #1523 on: September 17, 2019, 11:02:18 AM »
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SharperDingaan

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Re: PWE - Penn West Petroleum
« Reply #1524 on: September 17, 2019, 12:01:20 PM »
Come back in two months ....
Do you really think there will NOT be a strike on Iran, aimed at removing both the leadership and the processing facilities?
And do you really think that Iran will NOT strike in kind?

'Cause while everybody is bombing Tehran .. a couple more missiles quietly slip over the KSA border.
And this time, they finish the job.

The WTI supply and war premiums are not going away.
And they are interchangeable.

SD

gary17

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Re: PWE - Penn West Petroleum
« Reply #1525 on: September 17, 2019, 03:27:16 PM »
They will renegotiate a deal with Iran - Trump is here to make peace.  Can someone give him a Nobel already.

Spekulatius

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Re: PWE - Penn West Petroleum
« Reply #1526 on: September 17, 2019, 05:48:32 PM »
Come back in two months ....
Do you really think there will NOT be a strike on Iran, aimed at removing both the leadership and the processing facilities?
And do you really think that Iran will NOT strike in kind?

'Cause while everybody is bombing Tehran .. a couple more missiles quietly slip over the KSA border.
And this time, they finish the job.

The WTI supply and war premiums are not going away.
And they are interchangeable.

SD

I think Trump is far less likely to start a war than most presidents before him. I donít think there is going to be strike on Iran, at least not on Tehran. Perhaps a surgical strike on some military assets, but nothing like a war. Perhaps the Saudis are going to do something , but most likely, they will just buy a Patriot system to defend against these threats and we would be happy to deliver, I think. The US is self supplied with crude (net) , so this is somebody elseís problem. Let them figure it out.
« Last Edit: September 18, 2019, 06:33:16 AM by Spekulatius »
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Liberty

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Re: PWE - Penn West Petroleum
« Reply #1527 on: September 18, 2019, 06:23:44 AM »
Come back in two months ....
Do you really think there will NOT be a strike on Iran, aimed at removing both the leadership and the processing facilities?
And do you really think that Iran will NOT strike in kind?

'Cause while everybody is bombing Tehran .. a couple more missiles quietly slip over the KSA border.
And this time, they finish the job.

The WTI supply and war premiums are not going away.
And they are interchangeable.

SD

I don't know the future. It could happen, or it could not.

https://www.cnbc.com/2019/09/18/oil-markets-saudi-arabia-oil-production-in-focus.html

Anyone who claims to know the future is full of it. If they knew the future, they wouldn't have bought Penn West/OBE...
« Last Edit: September 18, 2019, 06:52:40 AM by Liberty »
"Most haystacks don't even have a needle." |  I'm on Twitter  | This podcast episode is a must-listen

SharperDingaan

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Re: PWE - Penn West Petroleum
« Reply #1528 on: September 18, 2019, 04:33:42 PM »
The reality is that OBE assets will be valued against a forward price deck that includes something for today's volatility; and in today's environment, using a pre-attack comp is not going to get you the winning bid. The discussions will occur behind closed doors, and the winning bids still might not be enough. Shareholders will know, as/when OBE issues a material press release. Purgatory for some.

Agreed, nobody knows how this SA/Iran 'thing' will eventually turn out. All we can do, is seperate the propaganda from the actual as best we can. And 'sniff test' what seems realistic, against what we know of the region. That said, few would dispute that the regional risk today is a lot higher than it was last week; and that today's and future crude prices will ultimately reflect it.

OBE's history of value destruction is well documented, so hardly surprising the market is giving zero credit to OBE's literally perfect 'timing' this time around. Depression prevails; few can see beyond their cost bases, or the opportunity. Their loss.

SD


« Last Edit: September 19, 2019, 05:23:37 AM by SharperDingaan »