AREX - Approach Resources: Acreage And Infrastructure Likely To Have Little Value In Restructuring
As Approach Resources (AREX) gets closer to a potential restructuring date, I continue to believe that its acreage and infrastructure will be attributed minimal value in restructuring. There have been past cases where hundreds of thousands of net acres of lower-quality acreage have been valued at close to nothing, and in Approach's case, its type curves indicate only 30% IRRs at around $65 WTI oil. This also impacts the value of Approach's infrastructure since fully monetising that infrastructure could drop its IRRs to 10% to 15% at $65 oil, making that idea