RE:RE:TNP= VLE In few WeeksWe now have more comparable data to determine the fair market value of TNP. Using the VLE metrics of 100,000 net acres in Thrace and an EV of $680M (cap $630 +$60M cash), we come on $6800 per acre. Not a chance that VLE would sell the package for $6,800 per acre. Using the Shaw metrics following delineation, we could eventually see as much as 9x this or $50K+ per acre with further delineation.
Let's say fair value is as follows:
- $7,000 per acre x 50,000 acres (today's price not the $9+ targets thrown out by analysts) = $350M
- Existing pipelines, leases, shallow production leases = $100M on a fire sale
- Liquidation Value = $450M
- Liquidation Value per share ($450M/90M FD) = $5 per share
With VLE and STO holding the rest of the basin acreage, this could be the cheapest entry point into the play. I wouldn't say that it would take long to get $5, rather I think this is the fire sale price and this happens quickly. Even at $4, we should have a very quick double + on our hands.