GREY:EXTSF - Post by User
Post by
Tokatoon Nov 27, 2007 2:55pm
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Post# 13875400
Don''t be surprised if DVN bids $2.00 cash
Don''t be surprised if DVN bids $2.00 cashDVN is trading at $70,000 BOEs/d. At $2.00, EXA would be worth $120 mm in total, which is $40,000 BOEs/d based on 3,000 BOEs/d.
DVN is EXA's partner at Eaglesham (and DVN owns 50%). DVN is focussing on growing its U.S. base. (DVN selling non-N.A. assets right now.)
DVN also wanted to grow heavy oil business (mostly in-situ SAGD projects), but is reconsider the amount to invest given royalty changes. That said DVN wants to keep its full staff in Canada despite falling production.
DVN buying EXA makes sense as it will add barrels where they are already a beneficiary. Plus by taking over primary operations it can keep its Canadian staff busier than otherwise.
Just don't be surprised.