Continued Discussion From Previous Board - Oil & Gas MLPS, CMZ

[Myth465]

Now is a good time to get back into these. EVEP and LINE are down and I am considering selling LINE to buy EVEP.

 

Also CMZ looks extremely interesting at this point. Someone said it was there top oil and gas rec, how do you feel about the debt service ability?

[T-bone1]

you might want to look at BBEP, Klarman sold LINE in Q4 to buy more BBEP.

 

CMZ's debt trades at about 35 cents on the dollar for a 37% YTM. I think that is the safer bet on the company, but just one man's opionion. However, If they could find a way to buy back their debt at these prices . .  .

[Myth465]

BBEP to me has litigation issues that I dont feel like researching. I think LINE was sold because they are all fairly similar but EVEP and BBEP have a higher yield. LINE has better hedges but, I think we only have 2-3 years of low prices.

 

How do you buy CMZ Bonds.

[T-bone1]

The lawsuit looks frivilous to me, and I think its cheap enough to compensate for the uncertainty.

 

I have a full service broker, I don't know how you would buy bonds without one, but I guess just call whoever your broker is and tell them exactly what you want and what you are willing to pay - make sure they don't screw you on price.

[JAllen]

I'm comfortable with the BBEP litigation because the complainant owns 40% of the company.  Also, the more than twice (I think) yield compensates for much risk within BBEP.  The lawsuit doesn't really allege any damages, it's just complaints it seems.  I am not an attorney though but I no longer hold Line, just BBEP, MCF, and Hlx. 

[Myth465]

Researching BBEP now. Wish I had looked into it a few weeks ago when EVEP and LINE were up 35 percent. Also why MCF. I love the management but think there are companies which are cheaper from an asset perspective.

[JAllen]

This is why we own MCF.

 

"Kenneth R. Peak, the Company’s Chairman and Chief Executive Officer, said, “At June 2001, after we listed on the American Stock Exchange, we had no debt, 11.4 Bcfe in reserves, and 16.0 million fully diluted shares. Today, some 8 ½ years later, we still have no debt, have grown reserves by 350 Bcfe, yet we have only increased our fully diluted share count by some 815,000 shares.”

 

 

http://www.businesswire.com/portal/site/google/?ndmViewId=news_view&newsId=20090303006326&newsLang=en

 

He and his geologists are an intangible asset not listed on any balance sheet.  $1.67/MCF is pretty cheap just on an NAV basis. 

[Myth465]

Thanks for the Update - BBEP reported today and all seems well. They have cut CAP EX and will try to maintain the div throughout the year.

 

There are just too many choices right now. Its mind boggling. I will add MCF to the list of interesting prospects.

[oldye]

This Ken Peak fellow is really growing on me!

[JAllen]

Yeah,

 

That's 49.6% compounded!