lol XOM took down that post on Big Eddy development.

Van Loh - Quantum - Day 2 DUG: Interesting discussion on a lot of topics. In general, Quantum likes to place capital in areas that can generate a return (duh) but are not crowded with unsophisticated investors (crazy promotes/cov-lite deals). Pointed out data centers currently having a similar set up today. Did point out that we are currently in an infra super-cycle, not just in gas pipe buildout, but in things like power. Says the power buildout has a good amount of runway for a bit, but will likely overbuild (as Pickering said yesterday). Talked on upstream; sees Haynesville as hard to invest right now as Asian buyers are too hard to compete with because of their outlet for the gas. The prefer large deals, but will look at anything. As far as what they do in each deal is target 20% return. On exit, they like to be FCF positive with enough future inventory to entice a buyer. They try to pick that time where incremental capital can no longer generate a target return to divest. Said there are less deals available as most large privates have been sold and difficulty building that position day one. Sees more future gas inventory than oil. Mentioned that M&A is difficult right now with such huge backwardation. And then spent a good 5 minutes politely saying that ABS is screwed. Not a big fan, in his own words. Deals are rated IG by second-grade agencies, yield-starved insurance companies don’t understand the risk, and people he talks to are getting nervous about their positions. One big bad deal collapses the entire market in his view, as it only exists because of that IG rating. Loves it as a seller though. Says that he sees them missing production/loe targets, leading to cash sweep increase, and doesn’t think they have been underwritten correctly (does he read my substack????).