- BP Prudhoe Bay's recently filed 10-K provides multiple warnings that it may be worth little, or more likely, nothing; warnings that many investors appear to be ignoring.
- In one respect, it's even worse than the 10-K indicates; it uses a 2020 Cost Adjustment Factor rather than ones based upon current (and quarterly increasing) CPI figures.
- As a result, the break-even price is around $61.41 rather than the official figure for 2021 of $60.72 and increases every quarter. The situation is even worse for 2022.
- There are various obligations that need to be satisfied in any case before distributions could resume, making the true "break-even" considerably higher than the math would suggest.
- Even under the most optimistic assumptions, BPT is worth a small fraction of its current market price.
For further details see:
BP Prudhoe Bay: The Situation May Be Even More Precarious Than Warnings In The 10-K Suggest