After another big loss, Quicksilver looks for minority partner
Nov 07, 2012 (Menafn - Fort Worth Star-Telegram - McClatchy-Tribune Information Services via COMTEX) --Shares of Quicksilver Resources dove nearly 10 percent Tuesday after the company became the latest producer to report a big loss due to the declining value of properties in light of low natural gas prices.
The Fort Worth-based independent said it lost 651.8 million in the third quarter, or 3.83 a share, after a 547 million write-off. After excluding all one-time charges, Quicksilver said it lost 8 million, or 4 cents a share, on revenue of 177.7 million.
Wall Street was expecting an adjusted loss of 1 cent a share, according to the consensus estimates. Quicksilver shares (ticker:KWK) declined by 35 cents a share to close at 3.36.
During a conference call, Quicksilver CEO Glenn Darden said the company is close to either bringing in a minority partner to help develop its Barnett Shale holdings or moving Barnett assets into a master limited partnership. The company has been talking about such a move for several months, and he said he expects a resolution "fairly shortly."
Darden said the preferred outcome is "selling a minority stake and bringing in a partner who helps us over time."
Pressed for specifics, such as putting a dollar value on a deal, Darden would only say that "it's a significant amount."
He emphasized that with the proceeds, "we are going to pay down debt." Quicksilver finished the quarter with 2.17 billion in long-term debt, up 262 million from the start of the year.
The Barnett Shale still accounts for the equivalent of 261.5 million cubic feet a day, or more than 70 percent of the company's total production. Output in the big North Texas field was down 8 percent from the second quarter.
The company has greatly reduced its drilling in the Barnett, moving as others have into areas that offer crude oil or natural gas liquids. Darden said the company is pleased with its first two oil wells on its Permian Basin acreage.
During the quarter, Quicksilver also began producing from an eight-well pad in Canada's Horn River Basin of British Columbia, with the wells ranging in production between 23 mcf a day to 34 million mcf a day.
Jim Fuquay, 817-390-7552
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