SandRidge Energy CEO Tom Ward on Joint Venture
SandRidge Energy CEO Tom Ward on Thursday spoke with Cramer about the company’s recently announced deal with a subsidiary of Repsol.
On December 22, Repsol said it would give up a percentage of its acreage in the Mississippian region in exchange for funding. In turn, SandRidge’s stock popped some 20 percent following the news. Meanwhile, the company is doing an initial public offer of more Mississippian acreage worth $500 million. Ward hopes these projects help the company achieve its goal of switching from a natural gas company to an oil company and also raise capital.
Some investors are worried SandRidge has a perceived funding gap, but Ward noted the company has been able to show how they are funding 2012. We just raised $1.8 billion of non-debt financing without any equity in 2011, he noted. He thinks these deals will be very profitable. Of the two million acres in the Mississippian play it’s acquired, it has retained about 1.5 million and monetized the rest. What they have yet to sell is equal to the market cap of the company.
To Cramer, SandRidge is a great speculative play. He might also consider looking at that upcoming IPO.