RE: PSD Getting Huge Transfer FeesYep,
He added more with his update at the bottom of the article:
"2/10/11 Update
The potential "windfall" transfer fee that I had described in the writeup appears now will be not if but when.
https://www.encana.ca/news/newsreleases/2011/0209-petrochina-jointventure.html
a few thoughts about the transaction.
1) this is a huge deal - the original release last year described$1-2b per year of targeted JVs for Encana - this one deal is $5.4b. soit looks like the scope of the deal became quite a bit larger thanperhaps was originally discussed last year.
2) The transaction is described as an "acquisition of 50%" of theCutbank business - which should make it quite clear that PSD is owed atransfer fee
3) the PR from last year talked about a JV covering Horn River,Greater Sierra and Cutbank. The current release describes thetransaction as only covering the Cutbank - PSDs prime area.
so, this is a bigger deal than expected and focused right on thecutbank/montney. this is about as good news as could be expected onthis front. this is not a closed deal, and the timing and size of thetransaction and impact on PSD are still unknown, but I'll stick withthe $20-40mm range that was described in the writeup."
This is the type of company you can be comfortable holding forever for all the reasons the author describes in the writeup. Once the dividend is announced, there will be a swarm of new shareholders bidding up the share price.
Good luc