Myth465 Posted November 8, 2010 Share Posted November 8, 2010 Devon Shire / Canadian Value (he seems to identify great picks in Oil and Gas and has made my job alot easier) has been correctly pumping this one for a while and has several good write ups - http://seekingalpha.com/article/229515-atp-oil-gas-good-times-are-just-beginning It hit $7 or $8 during the Moratorium and has recovered to $15. I bought at around $10-$12 using some expensive leaps. I think it should recover to $23 and then move up from there. Its being held back by Management failures in over promising and under delivering and due to issues related to drilling permits. Many think we still have a defacto moratorium due to the lack of permits being approved. They also have one of the worst balance sheets. With that said its cheap and if projections are correct it should work out. Einhorn was in and out and picked up a nice gain. I still hold about 10% - 15% of my port. Q3 was a nice surprise - http://seekingalpha.com/article/229515-atp-oil-gas-good-times-are-just-beginning Link to comment Share on other sites More sharing options...
eclecticvalue Posted November 10, 2010 Share Posted November 10, 2010 Do you think it is now a bad time to invest in it now? since the easy money was already made. Also it is loaded with a lot of debt. I am just curious about the situation. What are your thoughts? Link to comment Share on other sites More sharing options...
alertmeipp Posted November 10, 2010 Share Posted November 10, 2010 IMO, from 8 to 13 is risky money. From now on, it's easy money. Link to comment Share on other sites More sharing options...
eclecticvalue Posted November 10, 2010 Share Posted November 10, 2010 IMO, from 8 to 13 is risky money. From now on, it's easy money. Do not get me wrong, there was some high risk but the reason why I thought it was "easy money" was because the gulfwater moratorium ban was short sighted and sooner or later it was going to be revoked and it did, although the permits have not been given to all the drillers yet. Link to comment Share on other sites More sharing options...
Myth465 Posted November 10, 2010 Author Share Posted November 10, 2010 I think it should at least trade for $23. I thought the same as you at $12 (easy money was made, but I didnt find it till about $10) but so far so good. The issue now for me is when do we get revalued, and how will the economy hold up. There is still a huge short interest, the markets are a bit nervous, and we still have issues obtaining permits. Hopefully these issues get sorted out soon. The debt is annoying but I think they have the liquidity they need. It wouldnt be cheap if they were debt free. Management appears to have learned their lesson so I think they will address the issue as well. The company is dirt cheap considering there drilling schedule and the amount of production they have coming online. We have a few more GOM wells and then its off to other locations. It feels money good, has yet to be fully revalued I think due to uncertainty. This spells things out much better then I ever good. http://seekingalpha.com/instablog/201941-george-fisher/109633-atpg-the-good-the-bad-and-the-ugly?source=new_post_submission I dont know what I am missing but it seems as though we should take off after receiving the permits and drilling 1 additional well. I would like Management to hedge 80% of production at $88 - $92 a barrel. Link to comment Share on other sites More sharing options...
Swizzled Posted November 30, 2010 Share Posted November 30, 2010 ATP has new presentation out this morning. Page 8 shows the $500mil to $800mil of liquidity the company now has. The company has gotten themselves to where they wanted to be. One permit approval from the government and there should be a pretty sharp rise in the stock price. Can I sue BP for lost stock market profits ? Here is the link: http://valueinvestorcanada.blogspot.com/search/label/ATPG Link to comment Share on other sites More sharing options...
Myth465 Posted November 30, 2010 Author Share Posted November 30, 2010 ATP has new presentation out this morning. Page 8 shows the $500mil to $800mil of liquidity the company now has. The company has gotten themselves to where they wanted to be. One permit approval from the government and there should be a pretty sharp rise in the stock price. Can I sue BP for lost stock market profits ? Here is the link: http://valueinvestorcanada.blogspot.com/search/label/ATPG Thanks Swizzled, Let me know how that lawsuit works. I am sure they ow you something for the lost gains, they helped me out I would have never heard of ATPG otherwise. This seems like a no brainier but we have gone from catalyst to catalyst without much action. Hopefully this is the last shoe to drop. How did it feel to have Management quote you on a call? I thought that was slightly unprofessional but kind of cool. They seem to have addressed their over promising and under delivering. As CNQ would say 2011 should be the year of reward. Link to comment Share on other sites More sharing options...
Swizzled Posted November 30, 2010 Share Posted November 30, 2010 "How did it feel to have Management quote you on a call? I thought that was slightly unprofessional but kind of cool." It actually made me kind of angry. I'm not a big fan of the CEO who at no point in the past few years has ever even hinted that it was his fault that the company was pushed close to the brink. Instead he constantly pats himself on the back for being tenacious in battling through the financial crisis. I agree that they did a great job battling through, but it was clearly their own fault for overleveraging the company in the first place. The CEO is the primary manager of risk, and he did a lousy job. I like their hub model in the Deepwater and I like the discount to reserve value the company trades at. I'm not in it because I love the CEO. I've actually sent him a couple of less than flattering e-mails. Maybe he didn't make the connection between the e-mails and the fact that I have also written the articles. Link to comment Share on other sites More sharing options...
sdev Posted November 30, 2010 Share Posted November 30, 2010 Definitely qualifies as one of the most frustrating holdings I've ever had. It has been a first hand lesson as to what the real tangible value of great management can do for a company and its valuation. Link to comment Share on other sites More sharing options...
Myth465 Posted November 30, 2010 Author Share Posted November 30, 2010 Keep emailing, I think its working. I was impressed how they handled the last well. They are getting the message and are starting to focus on executing vs. celebrating. I also like how they handled Congress. Not much whinging, just trying to work through the issue. I dont know where they are from, but they sound like TX / OKC O&G guys. These guys are all cut from the same cloth - them, Ward, Aubrey McClendon. I cant fault them, those brass balls and it will all work itself out attitude probably played a part in getting them where they are. They do need better CFOs to keep things in line. Link to comment Share on other sites More sharing options...
Myth465 Posted December 3, 2010 Author Share Posted December 3, 2010 Alot of noise but we may have our permits. :) Link to comment Share on other sites More sharing options...
sdev Posted December 3, 2010 Share Posted December 3, 2010 Myth, You should know better than to have hope like that ;). I'd only believe it when it's true. In addition, even if they have the permits, we go back to: is the equipment available..how long will it take to get it in place...will the wells produce what is expected..etc..long road to stability. Link to comment Share on other sites More sharing options...
Myth465 Posted December 3, 2010 Author Share Posted December 3, 2010 Myth, You should know better than to have hope like that ;). I'd only believe it when it's true. In addition, even if they have the permits, we go back to: is the equipment available..how long will it take to get it in place...will the wells produce what is expected..etc..long road to stability. You are such a pessimist. I need guys you around when I am making investment decisions. I am holding Management to their word. Rig is in place. I think it was 60 days from Permit in Hand to Production. It may have been 90, but it was pretty short. I will have to look at my notes. 5% on permit chatter is great. INMO it shows that is what the street wants. Hopefully 15% - 20% once we get them. Link to comment Share on other sites More sharing options...
Swizzled Posted December 29, 2010 Share Posted December 29, 2010 ATP apparently has a tentative agreement to acquire 33% of two gas fields that appear to hold roughly 5TCF of natural gas. ATP's share of this would be more reserves than the entire company currently has (although gas weighted and ATP is levered to oil currently). At some point the CEO and founder who is 67 is going to be ready to sell the company, and locking down something like this is not going to hurt the eventual acquisition price. http://valueinvestorcanada.blogspot.com/search/label/ATPG It appears that there have now been 3 Deepwater wells approved in the past week (the first since the moratorium ends). Once ATP gets back to business it could be a rewarding 2011 for shareholders as they have 5 wells ready to go with all infrastructure in place. Link to comment Share on other sites More sharing options...
Myth465 Posted December 29, 2010 Author Share Posted December 29, 2010 Today is a nice day. Not sure how I feel about the gas deal. What are we giving up, hopefully not much more than development cost / expertise. I also wonder what pricing is like in the Mid East for nat gas. Isnt Qatar one of the countries with huge reserves. Link to comment Share on other sites More sharing options...
Swizzled Posted December 29, 2010 Share Posted December 29, 2010 Gas deal isn't even a deal yet. Hard not to be interested given the sheer size of the reserves. One thing I do know is that ATP didn't approach these guys, it was these folks seeking out ATP for their deepwater experience. Any time someone calls you the terms are bound to be better than if you called them. At least that is how I remember it from dating ! Link to comment Share on other sites More sharing options...
Zorrofan Posted December 29, 2010 Share Posted December 29, 2010 Myth, I owe you and T-Bone a big thanks for the help on SD! I am going to take a look at ATPG but debt levels are high and the interest rate is insane!! Do you see increasing production handling it or are you a bit worried? Production growth looks to be strong, the new platform has added value and it seems like this could be another interesting play......I will have to more reading up on it before it runs away on me. Up nicely today. cheers Zorro Link to comment Share on other sites More sharing options...
Swizzled Posted December 29, 2010 Share Posted December 29, 2010 "I am going to take a look at ATPG but debt levels are high and the interest rate is insane!!" And thus the reason shares with a net asset value of $80 are selling for $16. What I dream of is one day management waking up and realizing that the safest and easiest way to realize the value of these reserves and infrastructure is to sell the whole company. With Gomez and Telemark now producing that is a much more viable option than in the past. An acquirer could pay quite a premium to the current share price and still add reserves at a bargain. Move the assets to someone with a reasonable cost of funding and everybody wins. Link to comment Share on other sites More sharing options...
Myth465 Posted December 30, 2010 Author Share Posted December 30, 2010 For me SD and ATPG are very similar. ATPG is a bit better though. They are 1 permit away from low to mid 20s, and permits are now slowly being granted. The assets are there just packaged in a crappy structure which scares smart people such as yourself away. They will be cash flow positive after the next well, and should be able to fix the capital structure. Alternatively they could sell to a large operator for a good price. The operator could make money simply by refinancing the debt. Link to comment Share on other sites More sharing options...
Swizzled Posted December 30, 2010 Share Posted December 30, 2010 Deepwater permit freeze seems to have ended. Here are 3 approved in the last week, which would make well 3 since the moratorium ended. http://valueinvestorcanada.blogspot.com/2010/12/deepwater-permit-tracking-atps-first-of.html Link to comment Share on other sites More sharing options...
Myth465 Posted December 30, 2010 Author Share Posted December 30, 2010 Thanks for the updates Swizzled. You have, or will have made me quite a bit of money ;). I am thinking of buying another set of leaps. Figure we are days away from a revaluation. Every other time I have been wrong though. What are your thoughts? Link to comment Share on other sites More sharing options...
Swizzled Posted January 3, 2011 Share Posted January 3, 2011 "I am thinking of buying another set of leaps. Figure we are days away from a revaluation. Every other time I have been wrong though. What are your thoughts?" My thoughts are that I'm exactly with you. I can't believe the share price isn't higher after the Titan deal, the huge production from Mirage and $92 oil so I'll refrain from predicting a near term stock price move. All I know is that for the past 2 years I wasn't sure where the next $100 million was coming from and that is when the Telemark infrastructure wasn't complete. Now all the infrastructure spending is done AND they have $500mil to $800mil in liquidity. The stock market hasn't figured it out yet, but this company is in much better shape than they were pre Macondo when the stock price was $23. Link to comment Share on other sites More sharing options...
Alekbaylee Posted January 3, 2011 Share Posted January 3, 2011 Don't know this "Investment Research Co", but this may explain today's pull back : Equities research analysts at Zacks Investment Research reiterated an “underperform” rating on shares of ATP Oil & Gas Co. (NASDAQ: ATPG) in a research note to clients and investors on Tuesday. http://www.americanbankingnews.com/2011/01/03/atp-oil-gas-co-nasdaq-atpg-given-underperform-rating-by-zacks-investment-research-analysts/ Don't have any position. Just looking for now. Link to comment Share on other sites More sharing options...
Myth465 Posted January 3, 2011 Author Share Posted January 3, 2011 Sucks we were down 1% and I wanted to buy some leaps. Went to lunch, came back and we are up 2%. I bought some $20 leaps. Looks like we are almost there. Thinking of buying more now. Not sure if this applies to the Tele wells, but it seems like we are closer and closer to having this put behind us. Amazing that ATPG has not participated in the oil rally at all. http://www.boemre.gov/ooc/press/2011/press0103a.htm Link to comment Share on other sites More sharing options...
gordoffh Posted January 3, 2011 Share Posted January 3, 2011 my thanks also swizzled - have been buying heavily into SD and after reading the thread and a little investigation bought in today prior to the news - up in after hours also Link to comment Share on other sites More sharing options...
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