RE:RE:RE:RE:PNE & Natural Gas Fact vs Troll of Fear & NegativityYes negative equity... they raised capital bought assets at whaty they thought was a good value... market decline... all oil & gas companies did ceiling tests to calculate reserves... GAAP forces a write down of assets. Meaning propertieswith future drilling opportunities are not profitable therefor should be written down at the lower of cost & NNRV (net realizable value).
As the price of Nat gas rises the land becomes economic again and should be drilled. Focussing on paper losses where millions are wiped out with a simple accounting entry. But the entry is irrelevanty in the long term when the market comes bank to a normal supply demand balance and the price reflects that.
I can't tell when the market is at a bottom or at a top. But I do know that when the price of a commodity drops below the price of production costs... the price isn't sustainable if volume demanded in the market place is greater than the aggregate of the first quartile producers volumes can be supplied. That is the time to buy.
Classic example when oil hit below $10 in 1986, 1999 and 2020... each time was a good buying opportunity.
For Nat Gas March 2016 Henry Hub at 1.73 and during the beggining of the pandemic in 2020.