Brym ...
You can now redo your calculations with these new value/acre based on todays deal (Cheron buying Atlas Energy.
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Chevron said it will assume Atlas Energy’s rolein a $1.7 billion agreement announced in April with India’s RelianceIndustries Ltd. to produce gas from the Marcellus Shale.
The premium for today’s deal is more than the 13 percent average for the 252 U.S. oil and gas acquisitions announced thisyear, according to Bloomberg data.
“I wouldn’t be surprised to see another buyeremerge,” said Scott Hanold, a Houston-based analyst for RBC CapitalMarkets. “This values the company at about $9,000 an acre for a Marcellus position. Reliance paid about $14,000 an acre for the joint venture in Atlas’s core holdings. Investors are going to want somemore.”
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At 9000$/acre, that would give QEC a value of ...
But we're not yet there. But we also know that energy prices can only go up. And the franzy for quality acres too.
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Our valuation is almost free now...
When things aren’t going as expected one always has to look back and re-evaluate the current valuation.
We’ve got about $0.68 in cash, so the remaining $0.92 is the combined value of all assets of the company and future potential. Effectively a market cap of $215M assigned to assets. We’ve got about 230k acres of fairway plus 100k of non-fairway area and the assets in Alberta and BC. Overall if we just use the fairway acres, the current value on the company is at $935/acre.
Based on other land acquisitions in the US in prospective plays, $1000-2500 is not unusual, but we’re really beyond that stage. Granted everyone remembers plays going for $10k-20k/acre a couple of years ago when the frenzy was on but let’s not go there.
If we start looking at a value of $2500/acre that’s $2.45/share plus the $0.68 in cash, bringing us to $3.13. That’s the assets value today, not tomorrow or next year. That’s not slapping a 10:1 or 20:1 P/E ratio on it once they start selling the gas, that’s today...
I guess I’m frustrated and don’t get it and I’m sure this will just spur more selling but... I don’t know how we're at the current SP.
Brym
