devil ' s tower update louise ,
i spoke with tom byargeon this morning while he was at the offshore technical conference . he has spoken with rick fowler , dominion , and plans on visiting him in new orleans next week . the highlights from the conversations are as follows :
? by the end of this week or next , he will have information on two more total depth wells that have been drilled . based on the rumor mill , the reserves associated with the devil ' s tower acreage are looking even more promising . however , nothing is definite until all data is received .
? based on the well data , rick has three financing options :
? negotiate exclusively with a company like enron
? synthetic lease financing with a commercial bank
? rebid
? since dominion is now 80 % owner in devil ' s tower ( bought out mariner ' s 20 % ) , the credit profile of the project looks better . ( pioneer is the other 20 % . ) rick realizes his mistake going with a company that has no equity backing and has egg on his face with upper management . my concern is that based on his experience , he will take the easy way out and align himself with a commercial bank .
? enron has the following in their favor :
? convergent and enron ' s bid were very similar except convergent had aker . ( dominion wanted a guarantee of an aker spar . ) tom has spoken with bob o ' sullivan from aker and he is interested in aligning himself with enron . as such , we can bring aker back to the table .
? dominion wants to spend dollars on " steel " for the project by the end of june . as such , dominion will have to make a decision quickly because it will affect whether devil ' s tower becomes an on - balance or off - balance sheet transaction . i think that dominion would prefer an off balance sheet deal .
? dominion won ' t rebid because the other counterparties were not competitive relative to enron or convergent .
so , i think our true competition is against a commercial bank for synthetic lease financing . either way , we will have an answer quickly and since the gossip on convergent is out , i think it will stregthen our position on other spar bids ( ie . , medusa ) .
regards , mrha
devil ' s tower update
louise ,
i spoke with tom byargeon this morning while he was at the offshore technical conference . he has spoken with rick fowler , dominion , and plans on visiting him in new orleans next week . the highlights from the conversations are as follows :
? by the end of this week or next , he will have information on two more total depth wells that have been drilled . based on the rumor mill , the reserves associated with the devil ' s tower acreage are looking even more promising . however , nothing is definite until all data is received .
? based on the well data , rick has three financing options :
? negotiate exclusively with a company like enron
? synthetic lease financing with a commercial bank
? rebid
? since dominion is now 80 % owner in devil ' s tower ( bought out mariner ' s 20 % ) , the credit profile of the project looks better . ( pioneer is the other 20 % . ) rick realizes his mistake going with a company that has no equity backing and has egg on his face with upper management . my concern is that based on his experience , he will take the easy way out and align himself with a commercial bank .
? enron has the following in their favor :
? convergent and enron ' s bid were very similar except convergent had aker . ( dominion wanted a guarantee of an aker spar . ) tom has spoken with bob o ' sullivan from aker and he is interested in aligning himself with enron . as such , we can bring aker back to the table .
? dominion wants to spend dollars on " steel " for the project by the end of june . as such , dominion will have to make a decision quickly because it will affect whether devil ' s tower becomes an on - balance or off - balance sheet transaction . i think that dominion would prefer an off balance sheet deal .
? dominion won ' t rebid because the other counterparties were not competitive relative to enron or convergent .
so , i think our true competition is against a commercial bank for synthetic lease financing . either way , we will have an answer quickly and since the gossip on convergent is out , i think it will stregthen our position on other spar bids ( ie . , medusa ) .
regards , mrha