focusIR May 2024 Investor Webinar: Blue Whale, Kavango, Taseko Mines & CQS Natural Resources. Catch up with the webinar here.
More detail on the WV House Bill 5076, courtesy of Leoneobull over on Ad*fn:
WV House panel OKs bill viewed as legal shield for nation's largest gas and oil well owner
By Mike Tony mtony@hdmediallc.com
Feb 1, 2024
A West Virginia House of Delegates panel has approved legislation that would loosen gas well-plugging regulation and threatens to bar legal action to address abandoned wells in a state with approximately 15,000 of them.
The Energy and Manufacturing Committee on Thursday approved House Bill 5076, which would prohibit state code requiring wells presumed to be abandoned to be plugged promptly by the operator to be used as a cause of legal action by any person on their own behalf or in the interests of others.
Courtesy of elpirata over on ad*fn:
2 days ago — The West Virginia House of Delegates Energy and Manufacturing Committee approved a bill viewed as a legal shield for Diversified Energy ..
https://twitter.com/PhilipCPrice/status/1753521576740303332
Philip C. Price
@PhilipCPrice
& now he is protecting his buddies at Diversified Energy with House Bill 5076. It will allow the company 480 years to cap their abandoned gas wells!
https://www.wvlegislature.gov/Bill_Text_HTML/2024_SESSIONS/RS/bills/hb5076%20intr.pdf
"NOTE: The purpose of this bill is to clarify the process of well plugging. The bill adds new conditions in which a well does not need promptly plugged. Finally, the bill limits causes of actions in law and equity"
Much has been written on whether they can maintain the dividend, with credible reports that they Indeed can - and if they announce a maintained dividend in the March results then expect the price to absolutely rocket.
One minor point re your post - a reduced dividend would greatly lessen the rationale for buybacks - the saved resources would be better employed on acquisitions or debt reduction.
JonnyGee - it's actually a fair point and for a while I've been wondering over to what extent a dividend cut is already priced in, and whether it could actually lift the valuation. Given that a halved dividend would still result in a very attractive yield at the current price.
When I said many would be happy with just a doubling from here, I meant that as an initial target only. Plenty more possible given time, in medium to long term; particularly if they can demonstrate continued ability to pay the full dividend, gas futures continue the predicted rise, etc.
Why we expect Diversified to hold its dividend
https://t.co/xEzYThGnqX
And 3600 GBP target
December Letter references a 2021 Bloomberg article alleging that our wells “may be leaking a substantial amount of methane.” This statement is not accurate and was based on a misinterpretation of reports related to 44 well site visits, which represent less than a fraction of a percent of our wells across Appalachia. As noted above, we have voluntarily conducted 246,000 emission detection surveys on our well sites and those surveys have determined that our current company-wide fugitive emission free rate in 2023 for our natural gas and oil wells is 97.75%, meaning that nearly all of our sites had no unintended emissions at the time of the survey. These positive results are a reflection of our proactive, stewardship business model. As a result of our expansive emission detection survey program, our use of industry-leading detection technologies and our operating practices focused on continually mitigating unintended emissions, the data is clear that the Bloomberg article does not accurately reflect true emissions performance from our asset.