@bruutz82 - I think you have defined yourself earlier ... seeking to make and encourage positive posts to trade in and out of the stock.
OPEC news does drive price volatility - we seen that occurring all the time. Remember the spike when SA, Iran and Russia were going to "freeze" at higher production levels. OPEC has been increasing output in recent times.
The #1 thing that remains a concern (to me anyway) is the all the capex spend reductions (outside of shale) which given conventional declines has to be replaced. The #2 concern remains demand and demand destruction. Yes absolute number for demand is going up but the rate of growth in demand is coming down.
And wrt to demand at present, world economies are hurting. Central Banks, almost everywhere in the western developed world and begging for growth and have ZIRP in place to try and stimulate growth for years now. And where are we now?
And specifically to the 3 points you raised:
1. AKK is indeed debt free. When you try to sell the collateral upon which the loan is based you better pay the first lien holder off - else title wont pass! When you measure the amount of capital put into those projects (add up the impairments and accumulated deficits) there is a TON of SHAREHOLDER EQUITY that has been eviscerated - might explain some of the history here.
2. AKK can (eventually) drill sufficient Pierre wells to be self funding. Going to have to the math there I afraid. I've done some of it. Define eventually for us and define self funding (if that means funding all CAPEX from cash flow from operations only - history say NFW).
3. See (2). Maybe? Could a JV help? Maybe but hasn't AKK exited all its JVs to keep control etc. etc.
I would say, ask AKK to prove economic at $30/Bbl with actual results (e.g. well head sales and full costs). Nobody and I mean nobody that holds shares should give a rat's ass about "cash margin breakeven" which ignores all Capital costs and corporate costs. A property acquirer might think that way to begin with.
If gross revenue of $30K for a Qtr is pretty good (driven by KY production (has a ring to eh, hey)) then yeah the additional of 10/bopd would be material!
But for a trading profit.... anythings possible.
