EV Energy soars as Chesapeake Energy reveals new shale find in Ohio

HOUSTON, Texas - EV Energy Partners (Nasdaq: EVEP) surged premarket on July 29 as Chesapeake (NYSE: CHK) announced a "major new liquids-rich discovery" in the Utica Shale play of eastern Ohio.

EVEP owns some 150,000 net acres and has royalty rights on another 80,000 in the Utica Shale.

EVEP on July 29 reached an interday high of $73.37, up $9.50, before closing at $70.99, up $7.12, in heavy trading of more than 1.5 million units.

Chesapeake Energy's disclosure of the Ohio gas find came as part of its second-quarter financial report, in which it announced that its profit doubled as production increased, while prior-year results included a derivatives loss. Chesapeake shares rose on July 29 as results topped analysts' expectations. However, the units closed up by only $0.92 per share. The stock closed at $34.35. Chesapeake said it values its Utica Shale holdings at a possible $12,000 to $16,000 an acre.

Oppenheimer and Wells Fargo on July 29 raised their rating on EVEP to outperform, with the former setting an $85 price target and Wells boosting its to about $76 from $56. "We acknowledge that we are relatively late to the game," says Oppenheimer, "but believe there is significant upside remaining."

Copano Energy rises on bid to buy back $332.7 million in notes with new issue

Copano Energy LLC (Nasdaq: CPNO) on March 22 jumped to an intraday high of $35.15, up $1.13, on news that it was going to float a new senior notes issue to use in repaying older notes with a higher rate of interest. CPNO closed at $34.86, up $0.84. The stock is up about 46 percent the past year.

Copano is offering to buy back all $332.7 million of a series of senior notes due in 2016, the latest in a flurry of companies seeking to reduce leverage amid a low interest-rate climate.

The gas company has reported higher revenue in recent quarters, but rising costs have weighed on its bottom line. It has focused on growth targeting the Eagle Ford and Barnett shale rock formations underlying parts of Texas.

Copano is offering a 4.4 percent premium, including a premium for holders who consent to certain amendments to the indenture under which the notes were issued. The notes have an 8.125 percent coupon.

Copano Energy, L.L.C. and its subsidiary Copano Energy Finance Corp. announced on March 22 that they intend to begin a public offering of $360,000,000 in aggregate principal amount of senior unsecured notes due 2021.

Copano intends to use the net proceeds from the 2021 Notes offering to (1) fund its pending tender offer for any and all of the $332,665,000 aggregate principal amount outstanding of its 8.125 percent Senior Notes due 2016, and (2) redeem any of the 2016 Notes not acquired in the tender offer related to such notes, although it has no legal obligation to do so and the selection of any particular redemption date is in its discretion. Any remaining net proceeds will be used to provide additional working capital for general corporate purposes.