About a month back, you may recall that Quicksilver Resources
Concerns about the company's liquidity have dogged the stock for a while now. The firm does have one of the more enviable hedge positions among natural gas E&Ps, with about 75% hedged for the rest of the year at something like twice the current spot price, but Quicksilver's debt load is definitely on the heavy side.
Interestingly, a significant chunk of that debt is attributable to last year's $1.3 billion acquisition of a Barnett Shale property. That's exactly the asset that Quicksilver is now joint venturing with Italian oil major Eni
In its preliminary purchase allocation, Quicksilver has attributed $793 million of its total purchase price to proved reserves, which were pegged at 350 billion cubic feet (Bcf) of natural gas at the time of acquisition. By that math, they paid around $2.27 per thousand cubic feet (mcf). Not too bad.
Now, Quicksilver is selling a 27.5% stake in the property to Eni for $280 million. That includes 131 billion cubic feet of proved reserves, for a sale price of about $2.14/mcf. So right off the bat, it doesn't look like Quicksilver is following Denbury Resources
At the end of the day, this joint venture isn't as strong as the Chesapeake Energy