Hey Nord, interesting point. Possible refinancing could be an option, I suppose they could simply pay them out, with a new loan (but I really hope that will be in USD so that they have upside to the AUD strengthening again in coming years?) I am sure they can get a much lower rate than 6.5%.
Somewhat disagree with you about aAWE. The are adding substantially to their debt, whilst having no hedging and many of their oil assets are not low cost. The gas is profitable, but then... year after year they spend much more on capex than they receive in profits. I think AWE just refinanced a $400 million loan. But I get you point about timing and acquisitions. What seems a little out of whack, is that AED has offered to farm into AJQ, for upto $250 million (USD), which is basically a frontier basin, whilst for the same price you could simply buy DLS.... or AZZ, which just got a $250 million offer for acreage with no real production. Valuations are all over the shop IMHO.
DLS Price at posting:
48.5¢ Sentiment: Buy Disclosure: Held
