Rex Energy Corporation (NASDAQ:REXX) in its corporate presentation for October, identified that it plans to shift its focus on the potential reserves, in the Appalachin Basin. In addition to this, the company also revealed that Franklin Resources Inc (NYSE:BEN) has acquired a stake of 9.5%, in the company. It should be noted here that Rex Energy is one of those oil & gas companies, which have been severely affected by the declining oil prices. So far, the stock has lost 95% of its share value, since 2013.
The investment from Franklin is expected to draw a significant amount of attention, towards REXX, given that the financial advisor has a history of making long-term investments. This signals that Franklin sees potential in Rex Energy. Currently, the company has enough liquidity to continue development work, on its current wells. Further improvements in the stock price of REXX would require the company conduct efficient drilling operations in the Appalachin Basin, which may lead to more investments.
Recently, Rex Energy announced that its bank group had reaffirmed that it the company had a borrowing base of $190 million, under its senior secured credit facility. The company’s liquidity position is due to be re-evaluated, in April 2017. Tom Stabley, the CEO of REXX, announced his appreciation for support from the bank group and reaffirmed their commitment to financial flexibility and maintaining liquidity. He also announced that the Appalachin Basin is expected to start production, by mid-2017. Mr. Stabley stated that this had been made possible due to their transactions, during the current year and the reaffirmed borrowing base.
In addition to this, Rex Energy has been showing signs of making a shift, from an oil & gas producer to a gas producer, alone. The company recently sold its oil assets, in Illinois Basin, to Campbell Development Group LLC. It should be noted here that REXX had previously agreed to relinquish 76,000 acres in the Ohio Basin, to the same group.
Rex Energy Corporation (NASDAQ:REXX) closed at a share price of $0.574, at the end of the October 19 trading session, 6.89% higher than the day before, on a trade volume of2.34 million.