Diversified Energy Share Discussion Threads

[justiceforthemany] 21/3/2024 18:25

Shorts continue to rise, even at these levels and with the dividend cut announced.

What unreleased info are they insider trading on?

[scrwal] 21/3/2024 16:30

The Oak Bloke still needs to modify his ARO reasoning. The $5,961,000 is purely in relation to the DEC wells being retired and not any third party wells which would be accounted for directly in the profit and loss account. The costs for DEC wells are debited straight to the ARO provision - there is no offsetting which if it was treated like that would result in a qualified audit report.

It was surprising to see Oaktree divest their interests but I believe that there may have been a breakdown in the business relationship as there was no participation by Oaktree in the 2023 acquisitions. Furthermore Oaktree tend to have fairly long term views on their investments and don't go for shorter term speculation so I have a nagging suspicion that Oaktree wanted to get out even if the timing wasn't ideal.

[aleman] 21/3/2024 12:37

Energy stocks have only been lower 3 times in the last 40 years - article in Shares Magazine.

[drk1] 21/3/2024 11:08

and quite a few of us Kaos3! ;-)

[kaos3] 21/3/2024 10:59

125 mil fc after the divi pa, + leverage gives a huge potential to play with compared to the present mc

and they do play

so i see dec suddenly as a growth story

a surprise to my self

[kaos3] 21/3/2024 10:57

well - i loaded lots in the last month or so... am just a few per cent in minus considering just one divi... and this stock will be put away to pay for itself in just a few years /divi + some divestment later on/

i see no down risks atm

fast deleveraging, fixed divi, cheap gas as an opp for mergers /done/ ... and on and on it goes

one to put away on an auto pilot for a few years - 4-5 years

[drk1] 21/3/2024 10:40

@elpirata - good to hear I'm, not alone and if we get anywhere near Stifel's target of 2800p, I'll be one very happy bunny! I think we are already seeing the impact of the revised strategy and sentiment change, even though there remains quite a substantial chunk of shorters, who as we all know, will have to close at some point. ;-)

[elpirata] 21/3/2024 09:40

DEC & its peers fwiw

[elpirata] 21/3/2024 09:37

I bought again on Tuesday too Drk1, its been considerably derisked and the deleveraging reduction in enterprise value should correspondingly transfer to mcap enhancement, its not all about the (still 10%) divi, theres considerable share price upside from here imho, and thats notwithstanding any fututre buybacks

[mondex] 21/3/2024 09:25

EQT CEO warns lack of natural gas storage will trigger dramatic price swings
Joe Ryan, Bloomberg March 20, 2024
(Bloomberg) – The chief of the largest U.S. producer of natural gas has warned that a lack of pipelines and storage facilities will trigger dramatic price swings in the years ahead, causing them to surge as much 350%.

Gas demand in the U.S. has jumped 50% since 2010, while pipeline and storage capacity have increased just 25% and 10% respectively, EQT Corp. Chief Executive Officer Toby Rice said during an interview at the CERAWeek by S&P Global energy conference in Houston. That leaves the market prone to wild price swings, ranging from today’s level of about $1.75 per million British thermal units to as high as $8, Rice said.

“This is the world we live in unless we get serious about getting more infrastructure built,” said Rice, whose company last week agreed to buy Mountain Valley Pipeline developer Equitrans Midstream Corp.

Rice is a long-standing and vocal critic of the US regulatory framework and permitting process that he says holds up the construction of new pipeline infrastructure. In November, he warned that a pipeline crunch threatened to trigger an energy crisis. Rice also said in December that falling prices will lead to a slowdown in drilling, and that prices were well below the break even cost of production.

U.S. gas prices have undergone a dramatic collapse this year, plummeting to the lowest in four years and prompting several producers including EQT to slash production.

Another factor threatening to send prices swinging in the other direction is the dozens of coal plants that have closed in the US in recent years. Coal plants have traditionally helped keep gas prices in check because when it gets too expensive, electricity generators turn to coal for more of their power.

“That’s no longer an effective lid on prices,” Rice said. “So, you can see prices run through that and unfortunately start seeing industrial demand destruction driving price. That’s sort of the dynamic you saw in 2022 and would leave you with prices close to $8.”

[bluemango] 21/3/2024 09:06

People may not have picked up on the fact that Oakbloke has re-written and expanded his 19th March article, given it a new title but same link/reference as original one for that date (see header, or as copied below)

[drk1] 21/3/2024 08:47

As I said the other day, whilst a little taken aback by the substantial divi cut I see this as being good news and more importantly, a solid foundation for future growth which is why I did add pretty close to the bottom following the madness that ensued post RNS. In case anyone missed it, this is Stfel's take on events:-



Once the shorters have had their fill, we should see a substsntial & speedy recovery.

[bountyhunter] 20/3/2024 20:16

Closed up 1.14% in New York.

[bountyhunter] 20/3/2024 13:17

Huge volume yesterday, no surprise there but twice that in London vs New York.

[scrwal] 20/3/2024 12:47

I'm still waiting for the ARO supplement to be issued as the last one was for 30 June 2022.
Looking at the 2023 figures DEC is stating that it retired 222 of its own wells. The Annual Report on page 182 note 19 ARO obligations states that the Asset retirement costs were $5,961,000 which means the average cost per DEC well retired is $26,851 and not any lower net figure being shown elsewhere.

[bountyhunter] 20/3/2024 12:22

I thought you were saying "Lord God" for a moment 1k!

[bazboa] 20/3/2024 11:55

The Company announces that shareholders who have elected to receive their dividends in GBP sterling will receive an equivalent (post-consolidation) dividend payment of 68.44 pence per share, based on the March 15, 2024 exchange rate of GBP 0.78214=US $1.00

[1knocker] 20/3/2024 11:02

Lord G, I think you make a good point there.

DEC is a difficult company to understand, not least because under GAAP rules the accounts present a very uninformative picture. DEC appeared to be doing the impossible to pay the dividends it was, so investors had the choice 'trust the management to know what it is doing, or steer clear of a 'too good to be true' company'.

There are going to be fewer prepared to trust the management for some while.

[stevensupertrader] 20/3/2024 10:07

Private investors are getting out after yesterday div cut as this is not the stock to hold in SiPP

[bluemango] 20/3/2024 09:33

He was faced with an accumulation of issues, mostly outside his control, and has acted intelligently and rationally to address them and get the company back on a more sensible footing again.

[lord gnome] 20/3/2024 09:28

Rational perhaps Bluemango, but you can never ignore the irrational with the stock market. Rusty now has trust issues to overcome and if investors don't trust him then the share price will go nowhere.

[tag57] 20/3/2024 09:25

Blue, I agree but most have to vent to get the emotion out of their system, mine included.
It is acting on those emotions where potential poor decisions can be made.
I have done it in the past and missed a corresponding bounce so now try to sit on my hands for a few days after a significant loss - which has been a few in O&G over the last 18 months.

[bluemango] 20/3/2024 08:51

I understand that. My point was that judging by many posts on here and LSE yesterday, a lot of the response seemed more emotional than rational.

And that there is a perfectly rational case to be made that this is now a valuation with limited further downside and possible very decent returns on the upside. It won't be the same for everyone of course. While my average is high, I'm still receiving 4.5% even at the new rate, which is quite enough to hold for recovery. Emotion (bitterness, disappointment on one side, or irrational exuberance on the other) generally has no useful role in investing.

[fordtin] 20/3/2024 08:45

bluemango - I'm one of those angry private investor "I'm cross at the dividend cut so I'm selling now".

I was a passive dividend investor content to watch the noise and enjoy the dividend.
But as my dividend yield has been cut to around 3%, the only way I'm likely to see a return on my investment is to join the short-term traders.

I sold about half of my DEC shares yesterday morning, then bought & sold a few throughout the day.
I probably won't be the only 'angry private investor' trying to recover losses by trading the peaks & troughs.
With such a huge fall in share price to recoup, the aftermath isn't going away any time soon.

[kaos3] 20/3/2024 08:37

SPECULATION
looking back ... first oak tree deal, then nyse listing plans, then shorting combined with all kinds of environmental concerns, then fin community research notes /sometimes biased/, then obvious divi cut, then oak tree sells dec operated assets to dec ...

all that is missing is oak buying huge amount of dec shares to double the assets for the same dollar invested.

just wait - no more BBs to let others buy.... and of course no BBs ... they gave all the cash to oak

----------------------------------------
was oak tree some how limited in buying dec paper on lse but is not so on nyse....

tia

clearly huge trust and friendship rusty - oak... maybe fin cfo got it and did not like the cunning plan... and left

as did melanie after the oak deal ..../Diversified Energy Company PLC (LSE:DEC) announced today that, due to other commitments, Melanie Little will resign from the Company's Board of Directors (the "Board") as of 31 December 2022. Little, who has been a member of the board since 2019... /


a speculation of course - not reality ... but has a time and facts dots lined up perfectly

--------------------------------------
do oak people and rusty have some common prior history ....