GNE - Genesis Energy

[winner69]

Just to get an idea about your conviction in this stock at this moment ...if u dont mind sharing your current status ...more then 10% of your portfolio or still much below ....

As I feel its a safe stock at good yield and also very attractively priced at 4 years lows ...I am ready to go 15% or maybe little extra .

What u feel is risks of company default etc ...I am not worried about SP as I plan to keep it for next 10 years or more for income ...bought from that angle as discussed earlier ...not from capital appreciation angle ...if they keep giving this dividend and SP stays in this zone ...I am more then satisfied

OK GNE very attractively priced at 4 years lows - yes, priced about the same as a litre of petrol ($2.40)

With petrol now about $3.30 you could say that GNE share should be about $3.30 as well .... but that's really $3.59 when the 29 cents govt discount comes off soon

Yes, really cheap - GNE that is

[alokdhir]

OK GNE very attractively priced at 4 years lows - yes, priced about the same as a litre of petrol ($2.40)

With petrol now about $3.30 you could say that GNE share should be about $3.30 as well .... but that's really $3.59 when the 29 cents govt discount comes off soon

Yes, really cheap - GNE that is

I was not referring to its cheapness ...I am pretty happy with its current yield ...just wanted some perspective about the quality of the company and its long term viability ...also I understand that Crown thru NZ govt own 50.8 % thus majority holder and agenda decider ...

So if u reckon company good for another 10 years even paying static dividends is good enough for my purpose of 9+ % term deposit .

ASB Bank also has some risk ...but GNE maybe equally good or bad ...BBB+ for their bonds makes them almost as credit worthy as HGH I suppose ...lol

Main question was ...is it safe and quality enough company for 15% weightage in portfolio if one happy with current parameters ie yield

[Bjauck]

OK GNE very attractively priced at 4 years lows - yes, priced about the same as a litre of petrol ($2.40)

With petrol now about $3.30 you could say that GNE share should be about $3.30 as well .... but that's really $3.59 when the 29 cents govt discount comes off soon

Yes, really cheap - GNE that is

I paid $1.55 for them back in April 2014. Since then the returns have beaten the index. I am sure John Key got the best price on behalf of the NZ taxpayer
So they are still not cheap as far as I am concerned.

[alokdhir]

I paid $1.55 for them back in April 2014. Since then the returns have beaten the index. I am sure John Key got the best price on behalf of the NZ taxpayer
So they are still not cheap as far as I am concerned.

U could not get all U wanted in IPO ...but maybe bought some more in the market ...it closed $ 1.81 on day 1

[winner69]

I was not referring to its cheapness ...I am pretty happy with its current yield ...just wanted some perspective about the quality of the company and its long term viability ...also I understand that Crown thru NZ govt own 50.8 % thus majority holder and agenda decider ...

So if u reckon company good for another 10 years even paying static dividends is good enough for my purpose of 9+ % term deposit .

ASB Bank also has some risk ...but GNE maybe equally good or bad ...BBB+ for their bonds makes them almost as credit worthy as HGH I suppose ...lol

Main question was ...is it safe and quality enough company for 15% weightage in portfolio if one happy with current parameters ie yield

Think you’ve answered your own question. .,go for it …no worries.

[alokdhir]

Think you’ve answered your own question. .,go for it …no worries.

Thanks mate ! Your wide spectrum knowledge of the markets and companies is unparalleled ...

[Shareguy]

Gas shortages and high prices in the World and GNE decision to keep Kupe looking like a wise move. Was estimated by some at approx $250 to $350m before the Russian activity. What’s it worth now I wonder?

[Beagle]

Gas shortages and high prices in the World and GNE decision to keep Kupe looking like a wise move. Was estimated by some at approx $250 to $350m before the Russian activity. What’s it worth now I wonder?

I'll take a stab at that based on the explosion in Oil, Gas and LPG prices and taking into account it costs a lot to get it out of the ground.
I think the value has roughly tripled or quadrupled.

[Monarch]

Oil and gas assets are on the GNE books at a value of ~290 million with about 200 PJ of proven reserves remaining, at 46% stake GNE can claim ownership of 92 PJ. From the 2022 HY report the gas netback is ~$10/GJ for commercial and as high as ~$16/GJ for residential. There are 1 million GJ in a PJ, hence GNE can claim ownership of 92 million GJ. If sold to commercial customers that delivers a "total netback" of $920 million, if sold to residential it delivers $1.472 billion. So unless my math is wrong, either there are significant extra costs not being accounted for in the netback calculation or GNE's O&G assets are grossly undervalued on the books. The above math also assumes all of the oil and gas energy assets are sold as gas, which obviously isn't true but depending on the netback for oil etc may be valid.

[Muse]

Oil and gas assets are on the GNE books at a value of ~290 million with about 200 PJ of proven reserves remaining, at 46% stake GNE can claim ownership of 92 PJ. From the 2022 HY report the gas netback is ~$10/GJ for commercial and as high as ~$16/GJ for residential. There are 1 million GJ in a PJ, hence GNE can claim ownership of 92 million GJ. If sold to commercial customers that delivers a "total netback" of $920 million, if sold to residential it delivers $1.472 billion. So unless my math is wrong, either there are significant extra costs not being accounted for in the netback calculation or GNE's O&G assets are grossly undervalued on the books. The above math also assumes all of the oil and gas energy assets are sold as gas, which obviously isn't true but depending on the netback for oil etc may be valid.

PV of netbacks together together with NPV of GEN’s prorata share of decommissioning costs?