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California Resources Corporation Announces Joint Venture to Invest $250 Million in Oil & Gas Properties
February 16, 2017 04:16 PM Eastern Standard Time
LOS ANGELES--(BUSINESS WIRE)--California Resources Corporation (NYSE: CRC) announced today a joint venture (JV) with Benefit Street Partners L.L.C. (BSP) to invest in CRC’s oil and gas properties in California, with a focus on development opportunities in multiple CRC producing fields. CRC will operate the properties.
“This joint venture is an excellent opportunity for CRC to accelerate development of CRC’s vast underdeveloped resource base and advance our long term deleveraging efforts. We look forward to partnering with Benefit Street Partners for our mutual benefit.”
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The Joint Venture calls for Benefit Street Partners to invest up to $250 million for development opportunities in both conventional and unconventional assets of CRC in California. BSP will make an initial $50 million investment to be directed toward drilling activities across properties subject to the JV. BSP will make subsequent investments in tranches up to $50 million at the discretion of the JV partners over a two year investment window. Subject to customary conditions, the parties anticipate that the initial investment will fund in approximately two weeks.
Todd Stevens, President and CEO of CRC, noted, “This joint venture is an excellent opportunity for CRC to accelerate development of CRC’s vast underdeveloped resource base and advance our long term deleveraging efforts. We look forward to partnering with Benefit Street Partners for our mutual benefit.”
Tim Murray, Managing Director of BSP said, “We are proud to partner with CRC and their quality management team. We view CRC’s diverse asset base as an excellent opportunity to structure a joint venture to focus on the primary and secondary development opportunities to enhance CRC’s portfolio.”
About California Resources Corporation
California Resources Corporation is the largest oil and natural gas exploration and production company in California on a gross-operated basis. The Company operates its world class resource base exclusively within the State of California, applying integrated infrastructure to gather, process and market its production. Using advanced technology, California Resources Corporation focuses on safely and responsibly supplying affordable energy for California by Californians.
About Benefit Street Partners
BSP is a leading credit-focused alternative asset management firm that, together with affiliates, manages over $18 billion in assets across a broad range of complementary credit strategies including high yield, levered loans, private / opportunistic debt, liquid credit, structured credit and commercial real estate debt. BSP has approximately 150 employees with over 90 investment professionals. BSP is an affiliate of Providence Equity Partners L.L.C., a leading global private equity firm with $50 billion in assets under management across complimentary private equity and credit businesses.
Forward Looking Statement Disclosure
This press release contains forward-looking statements that involve risks and uncertainties that could materially affect our expected results of operations, liquidity, cash flows and business prospects. Such statements include those regarding our expectations as to our future operations, operational results, transactions, projects and reserves. Actual results may differ from anticipated results, sometimes materially, and reported results should not be considered an indication of future performance. Factors (but not necessarily all the factors) that could cause results to differ include:
commodity price changes
legislative or regulatory changes, including those related to drilling, completion, well stimulation, operation, maintenance or abandonment of wells or facilities, managing energy, water, land, greenhouse gases or other emissions, protection of health, safety and the environment, or transportation, marketing and sale of our products
unexpected geologic conditions
inability to enter efficient hedges
equipment, service or labor price inflation or unavailability
availability or timing of, or conditions imposed on, permits and approvals
lower-than-expected production, reserves or resources from development projects or acquisitions or higher-than-expected decline rates
disruptions due to accidents, mechanical failures, transportation constraints, natural disasters, labor difficulties, cyber attacks or other catastrophic events
factors discussed in “Risk Factors” in our Annual Report on Form 10-K available on our website at crc.com.
Any forward-looking statement speaks only as of the date on which such statement is made and we undertake no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.
Contacts
California Resources Corporation
Scott Espenshade (Investor Relations)
818 661-6010
Scott.Espenshade@crc.com
or
Margita Thompson (Media)
818 661-6005
Margita.Thompson@crc.com
CALIFORNIA RESOURCES CORPORATION
NYSE:CRC View stock quote and chart View SEC Filings
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English EON: Enhanced Online News
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California Resources Corporation Announces Joint Venture to Invest $250 Million in Oil & Gas Properties
February 16, 2017 04:16 PM Eastern Standard Time
LOS ANGELES--(BUSINESS WIRE)--California Resources Corporation (NYSE: CRC) announced today a joint venture (JV) with Benefit Street Partners L.L.C. (BSP) to invest in CRC’s oil and gas properties in California, with a focus on development opportunities in multiple CRC producing fields. CRC will operate the properties.
“This joint venture is an excellent opportunity for CRC to accelerate development of CRC’s vast underdeveloped resource base and advance our long term deleveraging efforts. We look forward to partnering with Benefit Street Partners for our mutual benefit.”
Tweet this
The Joint Venture calls for Benefit Street Partners to invest up to $250 million for development opportunities in both conventional and unconventional assets of CRC in California. BSP will make an initial $50 million investment to be directed toward drilling activities across properties subject to the JV. BSP will make subsequent investments in tranches up to $50 million at the discretion of the JV partners over a two year investment window. Subject to customary conditions, the parties anticipate that the initial investment will fund in approximately two weeks.
Todd Stevens, President and CEO of CRC, noted, “This joint venture is an excellent opportunity for CRC to accelerate development of CRC’s vast underdeveloped resource base and advance our long term deleveraging efforts. We look forward to partnering with Benefit Street Partners for our mutual benefit.”
Tim Murray, Managing Director of BSP said, “We are proud to partner with CRC and their quality management team. We view CRC’s diverse asset base as an excellent opportunity to structure a joint venture to focus on the primary and secondary development opportunities to enhance CRC’s portfolio.”
About California Resources Corporation
California Resources Corporation is the largest oil and natural gas exploration and production company in California on a gross-operated basis. The Company operates its world class resource base exclusively within the State of California, applying integrated infrastructure to gather, process and market its production. Using advanced technology, California Resources Corporation focuses on safely and responsibly supplying affordable energy for California by Californians.
About Benefit Street Partners
BSP is a leading credit-focused alternative asset management firm that, together with affiliates, manages over $18 billion in assets across a broad range of complementary credit strategies including high yield, levered loans, private / opportunistic debt, liquid credit, structured credit and commercial real estate debt. BSP has approximately 150 employees with over 90 investment professionals. BSP is an affiliate of Providence Equity Partners L.L.C., a leading global private equity firm with $50 billion in assets under management across complimentary private equity and credit businesses.
Forward Looking Statement Disclosure
This press release contains forward-looking statements that involve risks and uncertainties that could materially affect our expected results of operations, liquidity, cash flows and business prospects. Such statements include those regarding our expectations as to our future operations, operational results, transactions, projects and reserves. Actual results may differ from anticipated results, sometimes materially, and reported results should not be considered an indication of future performance. Factors (but not necessarily all the factors) that could cause results to differ include:
commodity price changes
legislative or regulatory changes, including those related to drilling, completion, well stimulation, operation, maintenance or abandonment of wells or facilities, managing energy, water, land, greenhouse gases or other emissions, protection of health, safety and the environment, or transportation, marketing and sale of our products
unexpected geologic conditions
inability to enter efficient hedges
equipment, service or labor price inflation or unavailability
availability or timing of, or conditions imposed on, permits and approvals
lower-than-expected production, reserves or resources from development projects or acquisitions or higher-than-expected decline rates
disruptions due to accidents, mechanical failures, transportation constraints, natural disasters, labor difficulties, cyber attacks or other catastrophic events
factors discussed in “Risk Factors” in our Annual Report on Form 10-K available on our website at crc.com.
Any forward-looking statement speaks only as of the date on which such statement is made and we undertake no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.
Contacts
California Resources Corporation
Scott Espenshade (Investor Relations)
818 661-6010
Scott.Espenshade@crc.com
or
Margita Thompson (Media)
818 661-6005
Margita.Thompson@crc.com
CALIFORNIA RESOURCES CORPORATION
NYSE:CRC View stock quote and chart View SEC Filings
Release Versions
English EON: Enhanced Online News
More NewsRSS feed for California Resources Corporation
Log InSign Up
More from Business Wire
BlogAppsUK/IrelandDeutschlandFranceHong KongItalyJapanEON: Enhanced Online NewsTradeshownews.comPYMNTS.com
Contact UsPrivacy StatementTerms of Use© 2017 Business Wire, Inc.
California Resources (CRC) presents at Goldman Sachs Global Energy Conference $CRC
http://www.seekingalpha.com/article/4034551
Short Sellers Appear To Be Scared By Trump $XLE
http://www.seekingalpha.com/article/4039367
How a Republican border tax proposal could boost U.S. oil production and prices
https://research.tdameritrade.com/grid/public/markets/news/story.asp?docKey=1-SN20170124010874&cid=1-SN20170124010874-MIP
Look at CRC
$CRC http://www.crc.com/images/documents/IR/Financials/161207_Wells_Fargo_Presentation.pdf
Current value doesn't include PUDs, land, infrastructure at even at the lower strip price.
Soros is a buyer...
CEO presenting at three conferences this month. Hopefully some good announcements - keeping the shorts honest!
http://www.crc.com/investor-relations
California Resources Corporation Announces Oversubscription of Its Tender Offer for Outstanding Notes and Expected Debt Reduction of Approximately $625 Million
"With current 2016 hedges we believe...remain compliant with revised covenants at $28/BO Brent price for year."
Today's Presentation (JP Morgan Energy conference):
http://www.crc.com/images/documents/IR/Financials/160628_CRC_JPM_Energy_Equity.pdf
I own a lot and continue to buy. I am a long term investor. IMO it's a bargain at this price.
I agree.
A few announcements then a short squeeze.
Yeah, bad day. No worries bought some more.
California Resources Corp (NYSE:CRC) Insider Activity
Several executives took part in recent insider activity for the stock. Its EVP – N. Operations Barnes Robert A. Purchased 48 company shares for $10000.13, in a transaction on 2016-03-07. Following the transaction, the EVP – N. Operations is left with a stake of 1,321 shares, currently valued at $25125. Meanwhile, EVP – N. Operations Barnes Robert A. Purchased 48 shares worth $10000.13, through a transaction dated 2016-03-07. Following the completion of the transaction, the insider is left with a stake of 1,298 shares, amounting $24688. CRC EVP – Public Affairs Weiss Charles F. also Purchased 80 shares, at a stock price of $135. This transaction occurred on 2016-03-04 totals $10000.8. After this transaction, the insider’s stake stands at 199 shares, with a market value of $3785
Insiders own 20% percent of the stock. STEVENS TODD A. is one of the largest insider shareholders in California Resources Corp (NYSE:CRC), according to U.S. Securities and Exchange Commission (SEC) filings. The insider owns 527,097 shares which have current market value of around $10025385.ALBRECHT WILLIAM E is another major inside shareholder in the company. The insider owns 327,926 shares as of Nov 4, 2015, currently worth $6237153. PINECI ROY is ranked as third insider holder of the stock. This insider holds 212,694 shares with a market value around $4045440 as of recent close.
Chesapeake - I have bought and sold it too many times to buy it again. Natural gas timing is tough.
Hopefully CRC can get back in all the funds like s&p400 that dump it below $1.00.
The greatest enemy of knowledge is not ignorance, it is the illusion of knowledge. —Stephen Hawking
Much lower, like in the $35/bo range.
Yes, all the stuff I previously discussed is behind CRC. Generating over $1 billion per year in free cash flow at $50/BO.
The current low PPS is in the ridiculous range - assumes a much lower oil price.
CRC is still ridiculously low at $50/bo.
Basically printing money at this oil price.
All extremely high ROI projects at this oil price! Just fixing wells...
CRC is currently priced as a bankruptcy risk, but has about a $20 profit margin. Historically it was hurt by:
1) $27/BO - 02/2016
2) Oxy having to sell 20%
3) dropping below $1, dropped by s&p400 and others
4) a reverse split
Now that all the baggage is out of the way, hopefully clear sailing ahead. Also, I should mention spinning off from oxy when oil price was dropping fast.
Savor 22.4% Yields With Deeply Discounted California Resources Corporation Bonds, Maturing January 2020 $CRC
http://www.seekingalpha.com/article/3979804
Yes RS happened 06/01/16. My guess is CRC will do better than peers now since it was RS discounted before.
All we need are a few earning reports with $50 oil... Lots of free cash flow.
Make that $40 PPS after the RS
Yeah, not keeping up with oil price. RS uncertainty... Hopefully after the RS is completed CRC converges to value ~$4 PPS.
I guess not the case.
From May 3 through May 6, 2016, California Resources Corporation (the “Company”) entered into privately negotiated exchange agreements with
certain holders of its 6% Senior Notes due 2024 and its 5 1/2 % Senior Notes due 2021 in reliance on Section 3(a)(9) of the Securities Act of 1933, as
amended. The Company agreed to exchange a total of 20,855,361 shares of its common stock, par value $0.01 per share, for notes in the aggregate principal
amount of $80,000,000. No commission or other remuneration was paid or given for soliciting the exchange.
The deal was completed at $3.83/share. This is what the stock price should be right now.
CRC's, at $50 ($40 realized), profit margin is $20/BO. Producing ~150k boepd or $90 MM per month.
Debt is about $5.6B and trading at $0.13 on the dollar or $728MM.
At this oil price, CRC could be debt free within a year. Very little Capital expenditures ~$50 MM per year.
Cash flow over $1B per year. We will see...
Yeah, seems like too much oil price and RS uncertainty.
Highly discounted.
Earnings report will look great ....
Also when you consider CRC has paid down debt (~$700MM) and significantly reduced cost..
The ratings report will look great if these oil prices hold.
Wow, $50 oil with very little capital expenditures. Large free cash flow... $1.5 PPS is hard to believe.
It should be ~$4 PPS now. Huge RS discount? The numbers don't add up.
I agree or no split at all, but we are small owners compared to mutual funds, etc.
CRC's stock price is really discounted. Oxy just bought Apache, the acquisitions have just begun!
All fair questions. The 10:1 was the split hedge funds, private equity, mutual funds, etc. want.
CRC is just providing its customers their request.
I agree the stock is likely already RS discounted. I honestly don't know how it will all play out. As stated, I do know at these oil prices, CRC is heavily discounted.
I plan to hold.
Given the current oil price, CRC is undervalued by a wide margin.
I think the inventory reports will play a big role this week in oil price continuing its upward trend.