Brad didn't elaborate regarding the hedges as to the mechanics of any rebasing, however there is no need to action on Grieve because ELK has full exposure to the upside .
As to the price ELK will get for Grieve , I was surprised when he said they will get a small premium to WTI, but I see no reason for Brad to say that if this is not going to be the case.
From what I understand , Elk can redeem the referred stock at a 20 % premium to the issue price so they will need to pay $13 million extra to redeem the $65 million prefs.... basically 1.25 years interest in advance but worth it to get that s#@t paper off the books.
They way Brad was talking about the operations at Aneth, IMO, ELK are going to eke out some significant low cost incremental production in the short-medium term ... we shall have to wait and see.
Cheers
Dan
ELK Price at posting:
7.9¢ Sentiment: Buy Disclosure: Held
