Range Resources: International Petroleum Strategic Merger - Management Q&A

Mining Maven Oil GasWe noted with interest the proposal from Range Resources (LON:RRL) to undertake a strategic merger with International Petroleum.  This merger represents a highly significant business development impacting both Range Resources’ and International Petroleum shareholders.

We noted the knee jerk reaction of the market to the news.  However, recognising the complexity of any merger transaction, it is necessary and prudent to take a step back and consider the elements therein carefully.  As part of this process we identified a number of questions regarding the merger transaction and its implications for shareholders and put these to Range Resources.

We trust you find this MiningMaven Q&A session below a useful source of information when assessing the proposed transaction and the forward value proposition of the merged entity.

Range Resources: Trinidad Oil Report

Trinidad is fast becoming the central pillar around which Range Resources executes its future global oil and gas strategy. Range has been operating in the Land of the Hummingbird for only a short time and, like this small industrious bird, has been working at a busy pace since. Found above the three ships of Columbus on the national crest, the hummingbird has the biggest heart of any bird comparative to its size, an endowment in common it seems with tough and resilient junior oil and gas operators such as Range Resources. For Range and the hummingbird, the application of focussed and vigorous activity is designed to expend one form of energy in the pursuit of another. For the hummingbird it is all about nectar; for Range it is about driving sustained, company changing increases in daily Trinidadian oil production.

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Range Resources: December interview with Pete Landau

John Maynard Keynes once said 'successful investing is anticipating the anticipations of others'. Of course, getting ahead of the game is never going to be easy; it usually requires investors to take counter-intuitive positions and maintain their conviction at exactly the time when the world around is bemoaning the trials and tribulations of the stock in question.

For bold investors, longer periods of tribulation can also represent the most fertile ground; marking a low point from where a substantial rise can come. Market cap and value are rarely one and the same, especially in the short term, and for value investors such valuation gaps can present an opportunity.