transforming nse, page-63

You have to "admire" all the armchair experts, expecially those put into those seats as "downrampers"

1. I hold the same number of shares now than when the announcement of acquisition was made - so I certainly have not filled any boots with stock.

2. Seen the pump hundreds of times where bleeding hearts and tornados buy low and ramp up to sell on T3 basis - have many of those are here?

3. Amateur grade fundamental analysis. That's pretty funny since just about everything I've posted is sourced from companies ORDERS OF MAGNITUDE LARGER than NSE. At the end here is a presentation (hopefully not so amateurish) from Sanchez Energy - they recently acquired the Wycross acreage that Anatol posted about.

4. And some here still think that NSE mgmt would know more than say EOG who surely must have been the "natural" acquirer for Peeler Ranch given its a tiny bolt on adjacent acreage. Or maybe they believe that MHR saved the best (prime) for NSE after discarding their other EFS lands to PVA.


Here are 2 slides from the armchair experts at Sanchez (even says so in the footnotes - management estimates)

Full presentation here
http://investor.sanchezenergycorp.com/phoenix.zhtml?c=248475&p=irol-presentations

Also on slide 22 - "93% oil sold on LLS pricing...."


Now ask yourself:

Would SN enter the EFS if all they hand was the Wycross property (their last acquisition).

Why wouldn't SN acquire the acreage from MHR (its not like Wycross is adjacent to any other land SN owns so could just as easily buy Peeler & Alright).

Why would SN spend $220M approx to acquire just 3,600 (contiguous acres) - which have 11.2 MmBOE of PROVED RESERVES and approx 2,000 Boepd of production. The answer lies primarily in the PROVEd RESERVES (paying fairly common $20/BOE of 1P). And how many times have "we" asked for Reserves Report but can't get it because of ASX rules ... but its good enough for SEC and for financial institution to assess RBL debt. Some investor protection that is

And lastly ask yourself why the SUCCESS CASE for performance shares begins at EUR 325 MBoE and tops out at EUR 425 MBoE, yet:

* Wycross has EUR 450MBoE - 550 MBoE (slightly higher CapEx probably due to either deeper drill to rach target zone, longer lateral and/or more frac stage spacing than Peeler Ranch)

* SN, with top tier peer group cash margins, gets 43% IRR on $90 oil (3MmBbl oil hedged in 2014 at $94). They didn't note whether that was calculated on 20y/30yr EUR

* How will NSE, with much lower EUR (approx 25%) against a forecasted lower well Capex (approx 12.5%) BUT with significantly higher LOE (as in don't forget for example the MHR Operator Fee of $50K/mth) earn these "attractive IRRs" . I'd settle for being told what the IRR is and backing it up with Type Curve and and then the PV10 Cash Flow statement. (Of course they may need to get out of the armchair to do that!).


So if you are happy with the information provided by NSE and feel it is complete and measures up against peer comparison vote for the deal. IMO I believe we do not have complete information and comparing to "peers" doesn't make it look all that attractive.


Anyone here actually going to go the EGM?