Monday, April 25, 2011

For Sale: The Other Half of Petrohawk's Pipeline Business

Last year I made light of Petrohawk's asset sales, characterizing them as a giant yard sale.  The company sold several billion dollars worth of productive - but "non-core" - assets to support its capital spending plans.  News came today that the company is selling the other half of its Haynesville Shale pipeline business (Kinder Morgan bought the other half) and hopes to raise $1 billion to support capex.

I've always been leery of selling assets to support growth capital spending, but Petrohawk is a producer and it has every right to support its core business.  When times are tough - and with $4/MMBtu gas, times are tough - you need to do what you do best.  Everything else is a distraction.

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