Phil Weiss

Analysts mostly agree that Chesapeake Energy received a relatively low price for the Mississippi Lime acreage it agreed to sell to China’s Sinopec for $1.02 billion. What is less clear though, is whether the price Chesapeake received reflects the company’s position as a distressed seller, or the quality of the assets sold. The Mississippi Lime is a shale play extending from northern Oklahoma into central Kansas.

“From my perspective, the proceeds looked a bit light on a per acre basis as well as per barrel of oil equivalent on a proved reserve basis,” Phil Weiss, Senior Analyst covering energy for Argus Research recently told Breaking Energy in an email. Keep reading →

BP’s heads of terms agreement to sell its 50% TNK-BP stake to Russian oil giant Rosneft was major news this week. But there was little mention of how oil and gas reserves would be treated as part of the transaction.

This is perhaps the most important aspect of this deal because reserves are one of the main factors that go into valuing an oil company. “On completion of the proposed transaction, BP expects to hold 19.75 per cent of Rosneft shares, including BP’s existing holding of 1.25 per cent, and to have received $12.3 billion in cash,” according to BP’s press release. Keep reading →