RE:Bottom line...
I dont mind the dilution or the divi at all. The planned production increase over the next 3 years doesn't make sense to me (but I'm an amateur so take that with a grain of salt) though. At $10,000 capital efficiency, they would save ~$475MM over 3 years by maintaining production instead of increasing it (less cashflow mind you) which is basically the debt taken on from the transaction. You're still a 25% bigger company than you were before with 10% more dividend which lowers the dividend break even ie more sustainable obviously and they can pay down the current (pre deal) debt even faster. Plus if other acquisitions come along, you have more room to manoeuvre.
On that note, here is my natgas comment for today:
EIA natgas storage came out this am. A little bullish. Based on Celsius - pretty accurate short term - we could be down near 180B above the 5 year average next week with 9 weeks to go to November 12 (which is the intersection of 2022 storage with the 5 year figure - exactly 3644).
And per Natgascollector on twitter, the YoY dry gas production increase has narrowed to 1.7bcfd and with LNG exports + pipeline exports to Mexico up 4.1bcfd YoY, you have a structural YoY deficit of 2.4bcfd which x 63 days = 151bcf. Getting there.
And of course natgas rig count is way down - lets see tomorrow - to 115 from a peak of 161 and that effect hasn't been felt at all yet IMO. Still in the first inning on that front.
Really natgas pricing should be a lot higher. With new LNG plants coming online in 2024, this artificially low price could cause a shortage if the rig count stays low for much longer AND we get some cold weather. YMMV.
So they may in a position in the near future to book some more advantageous hedges.