RE:RE:RE:Is Crew selling their Heavy Oil Assets?That's my logic.
It's a company that has been spending nearly $100M a year to keep production flat, stating that theyr'e replacing dry gas with more liquids (C5).
But as this happens, cash flow doesn't go up given the variabilty in product pricing for the many many reasons.
So, my logic flows to the fact that Mgmt get paid (for doing very little) to run this treadmill as do the lenders as they clip the coupon at 6.5% but shareholders never get a dime. The stock has trended down ad nauseum.
You may not like to hear this and you may call me all manner of names, but it's the facts.
One fact that I've left out that I'll now add is that regardless of small asset sales, the debt never seems to go down below the $300M mark sustainably. Always seems to grow right back to the $340-$360M range hidden under the drilling program and negative working capital that is funded by this debt.
Prove to me that this is not a treadmill and i'll be a happy buyer of the stock, but this has been the trend for years. Also, stating that other peers are in the same boat is no proof, because look at what happened to PONY, Bellatrix, Bonavista.. all the same treadmill, ended with a terrible fate.
The solution is to sell off non-core and by sell I mean sell, not wait to get a much higher price. They need to act today. Running a business is more than just drilling, it's balance sheet and investor mgmt. Selling non-core for less than what they will be worth in the future is good business, because the assets may be worth more in the future, but it won't be Crew shareholders that own them if they can't get that debt down and some gusto back into the name and the stock price.
They've become irrelevant.
Now queue the trolls.