Linn Energy LLC (NASDAQ:LINE) filed Annual Report for the period ended 2010-12-31.
Linn Energy Llc has a market cap of $6.25 billion; its shares were traded at around $39.7 with a P/E ratio of 25.95 and P/S ratio of 9.06. The dividend yield of Linn Energy Llc stocks is 6.65%.Hedge Fund Gurus that owns LINE: Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:The aggregate market value of voting and non-voting common equity held by non-affiliates of the registrant was approximately $3,839,988,972 on June 30, 2010, based on $26.55 per unit, the last reported sales price of the units on The NASDAQ Global Select Market on such date.
The Company has centralized the operation of its acquired properties into defined operating regions to minimize operating costs and maximize production and capital efficiency. The Company maintains a large inventory of drilling and optimization projects within each region to achieve organic growth from its capital development program. The Company seeks to be the operator of its properties so that it can develop drilling programs and optimization projects that not only replace production, but add value through reserve and production growth and future operational synergies. The development program is focused on lower-risk, repeatable drilling opportunities to maintain and/or grow cash flow. Many of the wells are completed in multiple producing zones with commingled production and long economic lives. In addition, the Company seeks to deliver attractive financial returns by leveraging its experienced workforce and scalable infrastructure. For 2011, the Company estimates its total capital expenditures, excluding acquisitions, will be approximately $520 million, including $480 million related to its oil and natural gas capital program and $23 million related to its plant and pipeline capital. This estimate is under continuous review and is subject to ongoing adjustment. The Company expects to fund these capital expenditures primarily with cash flow from operations and cash on hand.
These commodity hedging transactions are primarily in the form of swap contracts, put options and collars that are designed to provide a fixed price (swap contracts), fixed price floor with opportunity for upside (put options) or range of prices between a price floor and a price ceiling (collars) that the Company will receive as compared to floating market prices. The Company has derivative contracts in place for 2011 through 2015 at average prices ranging from a low of $84.09 per Bbl to a high of $93.58 per Bbl for oil and from a low of $5.65 per MMBtu to a high of $8.24 per MMBtu for natural gas. See Note 7 for the specific years and the related commodity prices. Additionally, the Company has derivative contracts in place covering a substantial portion of its exposure to the Mid-Continent natural gas basis differential through 2015.
On July 16, 2010, the Company entered into a definitive purchase and sale agreement (“PSA”) to acquire certain oil and natural gas properties located in the East Texas Oil Field in Gregg and Rusk counties for a contract price of $95 million. Upon the execution of the PSA, the Company paid a deposit of approximately $9 million, which is reported in “other current assets” on the consolidated balance sheet at December 31, 2010. On September 29, 2010, in accordance with the terms of the PSA, the Company sent a notice to the sellers of the Company s intention to terminate the PSA as a result of certain conditions to closing not being met. On October 11, 2010, arbitration proceedings were initiated concerning the termination of the PSA and the return of the deposit. The arbitration hearing concluded in February 2011 and a decision by the arbitration panel is anticipated during the first quarter of 2011.
On October 25, 2010, the Company s Board of Directors approved an increase in the quarterly cash distribution from $0.63 per unit to $0.66 per unit, representing an increase of 5%. On January 28, 2011, the Company s Board of Directors declared a cash distribution of $0.66 per unit with respect to the fourth quarter of 2010. The distribution, totaling approximately $106 million, was paid on February 14, 2011, to unitholders of record as of the close of business on February 7, 2011.
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