Welcome to our dedicated page for Diversified Energy Company Plc news (Ticker: dec), a resource for investors and traders seeking the latest updates and insights on Diversified Energy Company Plc stock.
Overview
Diversified Energy Company Plc (DEC) is an independent owner and operator specializing in natural gas and oil production, primarily concentrated in the Appalachian Basin. The company is recognized for its focused approach toward acquiring, optimizing, and managing mature producing assets, thereby ensuring consistent operational performance and sustainable cash flow.
Core Business and Operations
Diversified Energy strategically acquires existing natural gas and oil wells and associated midstream assets across several key states such as Tennessee, Kentucky, Virginia, West Virginia, Ohio, Pennsylvania, Oklahoma, Texas, and Louisiana. By integrating these assets, the company leverages its deep industry expertise to drive operational efficiencies and maintain low production declines. Its operational framework is built on the principles of asset optimization and cost efficiency, ensuring that mature assets are managed to deliver reliable performance over an extended lifecycle.
Revenue Generation and Business Model
The company’s revenue model is centered on the production and marketing of natural gas and oil, generated from a diversified portfolio of high-quality, low-decline assets. Through strategic acquisitions and disciplined asset management, Diversified Energy is able to optimize production and enhance cash margins. This model underscores a long-life asset strategy, where every acquisition is carefully evaluated for its ability to contribute to operational synergies and efficient capital deployment.
Strategic Initiatives and Competitive Landscape
Diversified Energy has consistently focused on bolstering its market position by expanding its asset base via well-targeted acquisitions and integrating associated midstream infrastructure. Its Smarter Asset Management program is pivotal in realizing operational improvements and cost efficiencies, positioning the company competitively in a dynamic energy market. By emphasizing regional strengths and scalable operations, Diversified Energy differentiates itself from larger incumbents, solidifying its niche within the natural gas and oil production sector.
Operational Excellence and Value Creation
- Asset Optimization: Maximizes the value of mature producing wells through targeted investments and operational improvements.
- Integrated Midstream Management: Coordinates production with midstream operations to streamline transportation and processing, enhancing cost effectiveness.
- Efficient Capital Deployment: Focuses on low capital intensity and a disciplined approach that supports sustainable free cash flow generation.
- Strategic Acquisitions: Expands production scale and asset density by acquiring long-life, high-quality assets that complement its existing portfolio.
Market Position and Industry Relevance
Within the highly competitive energy sector, Diversified Energy is known for its methodical acquisition strategy and robust asset management practices. The company’s focus on proven, low-decline assets not only minimizes operational risks but also offers a clear path for value creation. Its operations are supported by a strong regional footprint, making it a significant player in the natural gas and oil market without relying on speculative future projections.
Conclusion
In summary, Diversified Energy Company Plc stands out for its commitment to operational excellence and disciplined asset management. Its focused approach on mature asset optimization, combined with strategic acquisitions and integrated midstream operations, provides a comprehensive model for generating reliable free cash flow and long-term value. The company continues to serve as a key entity for investors seeking thorough insights into the operational and business dynamics of the energy production sector.
Diversified Energy Company (LSE/NYSE:DEC) has completed its acquisition of natural gas properties in eastern Texas for a gross purchase price of $69 million. The acquisition includes 70 Bcfe of PDP reserves with current net production of 21 MMcfepd. The deal was financed through a combination of 2,342,445 new shares issued to the seller and $22 million in cash from a secured bank facility. The assets are expected to generate approximately $19 million in Next Twelve Months Adjusted EBITDA, representing a purchase price multiple of ~3.5x. The newly issued shares represent 4.57% of existing share capital and will be subject to six-month regulatory restrictions.
Diversified Energy Company (LSE:DEC)(NYSE:DEC) has announced a significant natural gas supply agreement with a major Gulf Coast LNG facility. Under the three-year contract starting November 2024, Diversified will provide approximately 40 Bcf of natural gas with fixed pricing indexed to Gulf Coast pricing. Additionally, the company has enhanced its hedging portfolio for 2025-2027, securing an average NYMEX hedge price of $3.45 per MMBtu. The agreement aims to support global energy security while helping Diversified reduce commodity price risk and enhance margins.
Diversified Energy Company PLC (LSE:DEC)(NYSE:DEC) has announced a joint acquisition of natural gas properties in eastern Texas for $87 million. The company will acquire $68 million worth of Proved Developed Producing (PDP) assets, while a third-party development company will purchase most of the undeveloped acreage for $18 million. Diversified will retain a 5% interest in the undeveloped acreage for $1 million.
The acquisition will add 21 MMcfepd (4 MBoepd) of production and 70 Bcfe (12 MMBoe) of PDP reserves. Diversified's portion of the purchase will be funded through a combination of $35 million in new US-dollar denominated ordinary shares issued to the seller and existing liquidity. The deal is expected to close in Q4 2024.
Diversified Energy Company PLC (LSE:DEC)(NYSE:DEC) has completed the acquisition of natural gas properties and facilities in eastern Texas from Crescent Pass Energy for a net purchase price of $101 million. The acquisition includes:
- PDP reserves of ~170 Bcfe (~28 MMBoe)
- Current net production of 38 MMcfepd (~6 Mboepd)
- Estimated NTM Adjusted EBITDA of ~$26 million
- Purchase price multiple of ~3.8x
The deal was financed through a combination of 2,249,650 new US-dollar denominated ordinary shares issued to the seller and $71 million in cash. CEO Rusty Hutson, Jr. highlighted the acquisition's attractive pricing and potential benefits from increased scale and density in the Central Region.
Diversified Energy Company PLC (LSE:DEC) reported solid interim financial results for the first half of 2024, demonstrating reliable production and robust cash flow. Key highlights include:
- Average net daily production of 746 MMcfepd (124 Mboepd)
- Net Income of $16 million, including $98 million in tax benefits
- Adjusted EBITDA of $218 million with a 50% margin
- Free Cash Flow of $121 million, excluding working capital impact
- Leverage ratio of ~2.8x, or 2.6x excluding Oaktree transaction
- Declared Q2 2024 interim dividend of $0.29 per share
The company announced $516 million in acquisitions, including the $410 million Oaktree working interests acquisition. DEC continues to focus on strategic growth, sustainable capital return, and systematic debt reduction while maintaining operational excellence.
Diversified Energy Company PLC (LSE:DEC)(NYSE:DEC) has declared an interim dividend of 29 cents per share for the second quarter of 2024, covering the period ended June 30, 2024. Key dates include:
- Record Date: November 29, 2024
- Payment Date: December 27, 2024
- Last Date for Currency Election: December 6, 2024
The dividend will be paid in US dollars, with a sterling election option available. Shareholders wishing to receive payment in sterling must submit a currency election form by December 6, 2024. The sterling value of the dividend will be announced approximately two weeks before the payment date.
Diversified Energy Company PLC (LSE:DEC)(NYSE:DEC) has announced the timing of its 2024 Interim Results for the six months ended June 30, 2024. The company will publish its Interim Results on Thursday, August 15, 2024, followed by a conference call at 2:00 PM BST (9:00 AM EDT) to discuss the results. An audio replay will be made available shortly after the event.
Investors can access the conference call via toll-free numbers provided for the US and UK. Additionally, Diversified Energy will publish its 2024 Interim Report and a supplementary 2024 Interim Results Presentation on its website prior to the event. These materials will be available at the company's investor relations webpage.
Diversified Energy Company PLC (LSE:DEC) (NYSE:DEC) has announced its participation in several upcoming investor engagement events. The company's management team, including CFO Brad Gray and SVP of Investor Relations & Corporate Communications Douglas Kris, will attend investor meetings organized by Mizuho in Toronto on July 17, the Truist Energy Event in Denver on August 19, and the EnerCom Conference in Denver on August 20-21. Additionally, Douglas Kris and Senior Manager of Investor Relations Wren Smith will attend the Midwest IDEAS Conference in Chicago on August 29. Materials related to these presentations are available on the Company's website.
Diversified Energy has announced its acquisition of high-working interest, operated natural gas properties in eastern Texas from Crescent Pass Energy for $106 million. The acquisition will be funded through a combination of new share issuance and a senior secured bank facility, with an estimated net purchase price of $100 million. The assets include 827 net operated PDP wells, adding 38 MMcfepd of production and 170 Bcfe reserves with a PV-10 valuation of $155 million. The acquisition is expected to close in Q3 2024 and is strategically aligned with Diversified's focus on high-quality, low-decline assets.
Diversified Energy Company (DEC) has completed acquiring a proportionate working interest in certain assets within their Central Region from Oaktree Capital Management. The acquisition, initially announced on March 19, 2024, was closed on June 7, 2024, for a net purchase price of $377 million after adjustments. The acquired assets include PDP reserves of 510 Bcfe with a PDP PV10 value of approximately $462 million. The current net production is 122 MMcfepd, with an estimated 2024 Adjusted EBITDA of ~$126 million.
Additionally, Diversified Energy has increased its revolving credit facility by 26% or $80 million, bringing the total borrowing base to $385 million. This upsize results in an estimated post-transaction liquidity of around $130 million.
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