RE:frustrating companyLook -- John and Craig came into this with a good reputation for building and selling -- they followed this up with some of the best Montney wells from the first 18 months of Ante Creek results
But since they've been terrible and part of the problem is a lack of communication and opportunistic shareholder value creation
After the oil collapse in late 2014 they had plenty of oppty to sell company since peers continued to hold strong valuations, lesser names like Legacy were being gobbled up at $70k/flowing
instead of selling when shares were $3, $4, $5 they overvalued themselves, their assets and ran around with a complete lack of vision or perspective...as it relates to creating value
Instead, issuing equity at $1.40 after six months of telling folks how cheap their stock was seemed like a good move
At the end of the day they created no value from Ante Creek or Waskahigan and investors have now questioned the scale of their two core plays for 2 years, questioned the lesser results from Ante Creek and John's defense and explanation has been inadequate and supported by one of the worst valuations in the E&P industry largely due to John, Dean, Craig et al and an institutional loss of confidence.
At the end of the day, these guys have done many things right, but their primary goal is to create shareholder value and the BOD should realize that despite an above average b/s and very economic properties that that this company should be owned by ARX or another large Montney player that not only instills confidence, fully explains their value creation plan, but is large and liquid enough to truly develop some of Alberta's best locations.
John, Dean, Craig et al need a dose of self awareness and monetize this company....they may get another shot of creating meaningful interest with some success at Gold Creek. But Gold Creek and their Duvernay (which has value to a long term larger entity) are big boy assets which require capital and a low cost of capital. Not mini-me issuing shares at $1.41 (which is a 25% cost of capital to RMP).
This team has done many good things in the past, and some good initial moves at RMP, but the value creation upon exit is much greater than what they could attain organically.
It is time to focus on real world shareholder value plan. If you have an organic plan to create value at least communicate (which they have not).
I've been downsizing on spikes, adding when punishment is egregious, but realize the upside under the status quo has a defined limit and a permanent industry/institutional discount.
I wonder if Ferguson goes to sleep each night with $10/share on his pillow. It's a unique situation where many sensible, conservative initiatives (coupled with consistently strong well results) has led to one of the worst performing, lowest valuation names in the sector. Unfortunately (and I don't like saying this) it's because of John and all that is lacking overwhelming many sensible moves since they joined RMP.