29
Nov

Monday Morning – Calm Before The Data and News Storm

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Market Sentiment Watch:  Busy week ahead. On the economic data front we get lots of data starting Tuesday and culminating in non-farm Payrolls for the month of November at week's end.  As far as today goes, Black Friday looks to have been a bit of a mixed bag, with sales estimated to have risen 0.3% according to Shoppertrak, still resulting in a new sales record but expectations may have been higher.  In Europe, Ireland took a $112.5 B bailout ... we have to wait and see if this calms market fears that Ireland's troubled bank issues will reach Spain and Portugal. In politics a number of tax credit items are on the discussion but probably not the chopping block as congress begins a lame duck session before the holidays. In foreign affairs we have war games in new North Korea that could results in a second round of cross border fire. In energy land we get natural gas supply figures  later today (month of September and I'm looking for flattish numbers) and we have two energy conferences this week that should provide impetus for increased news flow following last week's near hibernation in the sector.

Housekeeping Watch: We have migrated to our new server and are continuing to tweak a few items. Thanks for the feedback over the last several days, very helpful.

The Week Ahead:

  • Monday 11/29: No economic data release scheduled,
  • Tuesday 11/30: Case-Shiller home prices, Chicago PMI (F = 59.8%), Consumer Confidence (F = 52), Canaccord Energy Conference, EIA natural gas supply
  • Wednesday 12/1: EIA Oil Inventory Report, ADP Employment, Productivity (F = 2.3%), ISM (F = 56.8%), Car sales (F = 12.2 mm), Beige Book, Jefferies Energy Conference
  • Thursday 12/2: EIA Natural Gas Inventory Report, Jobless claims (F = 425,000), pending home sales
  • Friday 12/3: Non-farm payrolls (F = 165,000), unemployment rate (9.6%), ISN non-manufacturing (F = 55%), factory orders (F = -0.6%)

In Today’s Post:

  1. Holdings Watch
  2. Commodity Watch
  3. Crack Spread Update
  4. Stuff We Care About Today
  5. Odds & Ends

Holdings Watch:

  • ZCAT (Zman Catalyst portfolio):
    • $5,100
    • 99% Cash
    • Yesterday’s Trades:
      • None.
  • ZIM (Zman Inefficient Markets portfolio)
    • $8,400
    • 4% Cash
    • Yesterday’s Trades:
      • None

Commodity Watch

Crude oil closed up 2% last week at $83.76 despite the first report from the EIA on inventories that looked overtly bearish. One week does not a new trend make but if we see a continuation of anemic gasoline and especially distillate demand I would think that another test of the $80 mark is in order. This morning crude is trading about $0.65.

  • Mexico Watch: Mexico had 2 of their big 3 Gulf of Mexico side oil export points offline part of last week due to rough weather. Look for a dip in imports in this weeks numbers after last week's surge.
  • Iraq Watch: The consortium led by Exxon in Iraq's West Qurna Phase 1 project  plan to boost production from a current ~ 235,000 bopd to 750,000 bopd in 3 years through water floods and workovers. One has to start wondering when the OPEC 12 make a move to rope Iraq back into the quota covered countries.  

Natural gas closed at $4.40 on Friday after EIA reported the first storage withdrawal of the season. We are range bound and my sense is we are closer to the upper end of the near term range than the bottom. Storage is likely to skirt along record levels for this time of year for the next couple of months. We get the gas supply figures later today for the month of September and I expect flattish results with the prior month ... not much of an inspiration for bulls. This morning gas is trading up 6 cents.

  • Weather: 
    • Last week was the coldest of the year so far at 156 gas-consumption-weighted heating degree days vs 131 in the prior week (which produced the 6 Bcf withdrawal last Thursday).
    • This week's forecast calls for HDDs to move up to 171, normal for this time of year.

Stuff We Care About Today

Not much on the Energy news front today but that should change as the week progresses and companies speak at 2 conferences.

Other Stuff

  • Reuters Poll on Chinese Coal Demand

    • A survey of 10 analysts put Chinese coal import growth will be 29% in 2010
    • Slowing to 13% in 2011 or 151 mm tons in 2011. The increase is coming both from steel demand and from generation.
    • ZComment: my thinking here is that BTU will continue to be a standout in the seaborne coal market and I will be moving to diversify the ZLT to include it as a core position next year but will be reworking my own coal thoughts framework before I jump and looking for a pullback in what has been a strong group. WLT probably will be in there as well. 
  • APC Announces Another African Offshore Find
    • Mozambique - 550 net feet of gas pay (would have been better to be oil but this is large), at depth of 13,850' with a planned TD of 15,900'.
    • This is the 3rd offshore African discovery in as many weeks and the stock has yet to budge. 
  • TGA Guides 2011

    • mid point of range is 33% production growth, with potential upside from one project that has not yet received government approvals.
    • I'll be working this one up soon.

Odds & Ends

Analyst Watch:

  • GLNR - cut to Hold at Dalhman
  • LGCY - coverage resumed at Stifel with Buy rating and $30 pt.
  • RDC - Barclays raises to Overweight
  • FRO - Deutsche Bank downgrades to Hold, target $34

155 Responses to “Monday Morning – Calm Before The Data and News Storm”

  1. 1
    bill Says:

    robry with a -22
    no news from mmr

  2. 2
    bill Says:

    aubrey of chk building up efs position– 200 m
    http://www.bloomberg.com/news/2010-11-29/antares-energy-reports-200-million-sale-of-assets-to-chesapeake.html?cmpid=yhoo

  3. 3
    BirdsofpreyRcool Says:

    Good morning!  And Happy Week After Thanksgiving.
     
    Will check around on MMR's logging run today.  Maybe there is some scuttlebutt to be gleaned.  If there were no problems with the run, it seems to me that  results should be announced soon.

  4. 4
    BirdsofpreyRcool Says:

    GST — I see that the court approved Gastar's "don't worry about that, it's not material" litigation settlement of $21.15mm.  The only good news (other than it's behind us now) is that I guess you have to subtract that number from GST's total available liquidity, in estimating the cost/acre of it's recent Marcellus purchase.  That makes the max $/acre paid even lower.
     
    Sheesh.  NO litigation these days is "frivolous and inconsequential."  GST may have been right, but obviously they were willing to hand over a pile o' cash to get out of the grips of the lawyers.

  5. 5
    bill Says:

    more details
     
    antares might be agood buy on this
     
    http://www.gtp.com.au/antaresenergy/inewsfiles/2010%2011%2029%20Yellow%20Rose%20and%20Bluebonnet%20Release.pdf

  6. 6
    zman Says:

    Re 1 Thanks on the robry. Re MMR – not surprised to not have news, deep wells always take longer than you think. Big "ifs" involved in getting the tool to work at pressure and temp here, even if it is slightly cooler than in their last wellbore. 

    Thanks BOP and good to have you at the first meeting of the SDM roundtable this weekend. Thanks to RMD for hosting. If you couldn't make the meeting just think AREX, AREX, AREX, KOG, EXXI, MMR, AREX, AREX, SSN, AREX. 

  7. 7
    bill Says:

    >the first meeting of the SDM roundtable this weekend
    Whats this? Did i miss a party

  8. 8
    zman Says:

    Bill thanks for 5, funny, not showing up on my news screen under CHK today. Thoughts a) pretty pricey for EFS acreage vs some other recently announced buys (great job by Antares to lay recent EFS sale stats out for us) but not surprised that CHK would pay up for it, b) it will feed analysts' complaints about CHK not being able to reduce spending and Aubrey never seeing an acre he didn't like, and c) item b will b offset by the thought that this is part of CHK's get oily sooner rather than later plan. 

  9. 9
    BirdsofpreyRcool Says:

    Madison Williams Market Monitor (linked here with permission)
     
    http://library.constantcontact.com/download/get/file/CMM%2011.29.2010.pdf

  10. 10
    BirdsofpreyRcool Says:

    z — thanks for setting it up.  Clearly, being part of the SDM Group requires lots and lots of libations.  😉

  11. 11
    ram Says:

    Since AREX is not a SDM, but has less than 500MM market cap, is there another category that would suit – SCE (small cap energy)?

  12. 12
    zman Says:

     

    re 7 – BOP wandered through our town over the weekend, RMD served wine and turkey sandwiches.  re 11, no its just that RMD is a natural born rule breaker. 

  13. 13
    BirdsofpreyRcool Says:

    Another little comment from Madison Wms worth repeating this morning….
     
    Land Drilling- ND Rig count avg 151 in Oct up from 143 in Sept and now avg 159 for the mo of Nov.  Great for the Pressure Pumpers HAL SLB NBR/SWSI and CPX.

  14. 14
    milepost_43 Says:

    Thanks for including TGA….2011 forecast is +9.5% above Canaccord Sept report which had $C12 target…believe it has since been raised to $C19….don't have newer report.
    INVESTOR PRESENTATION – CANACCORD GENUITY GLOBAL ENERGY CONFERENCE
    Mr. Clarkson will make a presentation on the Company at the Canaccord Genuity Global Energy Conference in Miami, Florida on November 30, 2010 at 3:20 PM Eastern Time (1:20 PM Mountain Time). Investors may register directly for the live web cast at: http://www.wsw.com/webcast/canaccord3/.
    Links to the webcast of Mr. Clarkson's presentation will also be provided on TransGlobe's Web site at http://www.trans-globe.com.

  15. 15
    zman Says:

    Front and Center Watch:

    Catalysts this week:

    BEXP – speaks at two conferences, timing is right for one of those to see an operations update. Looking for the results of their 3rd well in their first downspacing pilot (Brad Olson wells) as well as 3 or 4 more Rough Rider wells. I don't expect any news out of their Montana wells but probably a nod that 2 of them have now spud. The downspacing is more important than the ongoing string of high IP wells at the moment as they can begin to solidify a new target for wells per unit. 

    WLL – time for L&C update with wells in the fairway between the disco well and the stepout wells. Also a near twinning of the discovery well but with more stages and I think a longer lateral. Positive news there could take this one to new highs. Actually that goes for BEXP above as well. 

    CXPO – due for some mid Bossier results. 

  16. 16
    zman Says:

    MP – no, thank you for bringing it in here. I have been completely asleep at the wheel on the name. I plan on being on that presentation and will begin to work it up after having started then stopped after it ran. 

  17. 17
    milepost_43 Says:

    LYB…..ETRADE flash says Citigroup starts Lyondell at BUY…anybody have target price? thanks.
    long Mar 25calls here.

  18. 18
    zman Says:

    NBL on the tape with gas discovered in the first zone of Leviathon (Israel).  

  19. 19
    zman Says:

    re 17 – I have it as Dalhman Rose initiation, Buy, pt $38. 

  20. 20
    zman Says:

    Weird soft open for all the flattish futures headlines that were streaming across just prior to the bell. Volumes look pretty light out of the gate. 

  21. 21
    zman Says:

    KOG taking the opportunity to inch on towards $5 while the market is busy worrying over all the things in the opening paragraph. 

  22. 22
    zman Says:

    Bakkens doing pretty good job of ignoring the broader market. Could be one of those days where we see Europe close and the US lift some. 

  23. 23
    BirdsofpreyRcool Says:

    MMR — "no news" is being taken as "bad news."  We shall see, of course.  But we are due some operational updates from JimBob… and delay of news is not received well in the e&p/well-watching biz.

  24. 24
    crysball Says:

    PEMEX    is reported  to have closed  3 to 4 gas fields  in N. Mexioc  due to  drug   cartel  vilence:
    http://finance.yahoo.com/tech-ticker/mexican-drug-violence-threatens-u.s.-energy-supply-edmonds-says-535655.html?tickers=USO,OIL,XLE,BP,EWW,COP,OXY&sec=topStories&pos=9&asset=&ccode=

  25. 25
    andy Says:

    re 20   fair mkt value for dow pre-opening was +43   last futures quote i saw before open was -26  signifying mkt open -69

  26. 26
    zman Says:

    Crys – thanks, had not seen but suspected. Mexico has in the last 10 years, built up gas fired power generation near the border, first importing gas from the US and then supplanting that with new gas production in the north. It's a small slice of US demand but it looks like it will be creeping up. Unless they close the power plants too. 

    Thanks Andy – I must have had some stale quotes on my system. 

  27. 27
    RMD Says:

    BOP link in 9 did not open?

  28. 28
    zman Says:

    RMD – are you familiar with Puerto Chiquito field, I think AREX is there? 

  29. 29
    BirdsofpreyRcool Says:

    RMD — try this one… if it doesn't work, perhaps it needs to be "cookie-enabled" or something.  Let me know…
     
    http://library.constantcontact.com/download/get/file/CMM%2011.29.2010.pdf

  30. 30
    BirdsofpreyRcool Says:

    #29 — never mind.  The link doesn't work when pasted here.  Will see if I can get that rectified.

  31. 31
    zman Says:

    President holding a press conf to announce federal employee pay freeze. 

  32. 32
    RMD Says:

    RAJA notes a Bureau of Ocean Energy Mgt  notice to leaseholdersacce;eraing and reinforcing plug-and abandon regs in GOM.  Calculates last 10 yr. actual P&A abandonment rate @~45 yr. well life vs. their real-life well life est. of 10 yr. While enforcement will need more teeth, see spending on P&A increasing30-150% over next few yrs, first effect by '12.  DVR, TTI, GLBL,SPN

  33. 33
    RMD Says:

    28. yes, and am rel. up to date.

  34. 34
    zman Says:

    Great. Has AREX drilled there yet. If so, are they verticals, I assume they went through the Mancos/Niobrara, any shows? Who else has drilled that particular field?

  35. 35
    zman Says:

    re 32. – thanks, makes sense. EXXI probably to be relatively unaffected as their P&A liability is small now. Some others, like SGY could really get stung. Nothing like having the game change mid course over something that's about as related to what happened as is the price of tea in China.

  36. 36
    zman Says:

    RMD – to your emailed question, yes, see email

  37. 37
    zman Says:

    Getting on a call for about 45 minutes. 

  38. 38
    cargocult Says:

    Somewhere along the line I picked up WRES. Is this company on your radar? Or anyone's?

  39. 39
    choices Says:

    http://www.marketwatch.com/story/fed-buys-217-billion-in-treasurys-bonds-stay-up-2010-11-29
    Fed buying TBonds

  40. 40
    zman Says:

    Cargo -still on call, but no I sold it quite awhile back. I watch it only passively at the moment, though the stock has improved with oil prices and their thoughts to increase activity. 

  41. 41
    isleworth Says:

    Z – – Targa Resources Corp doing IPO shortly, tentative pricing $19-$21. Warburg Pincus selling about 40% of their holdings. Morgan Stanley, Deutsche Bank, Citi, Barclays, B of A in syndicate. Have you looked at filing? If so, any thoughts? Tks.

  42. 42
    zman Says:

    Isle – thanks, not yet, plan to. Do you have a rough date for the IPO yet? 

  43. 43
    irongate Says:

    Yes choices… that was the first POMO of the day… we have another one potentially 3 times as large (6-8 billion) coming up at 1:15 today.     All totaled there will be nearly $40bln in POMO's this week alone….. and based on the price action of the market lately… I think we'll need it just to stay even.  
    It's nice of Obama to announce Pay Freeze's of gov't employees at the ALL TIME HIGH.   Well….  at least its a start.

  44. 44
    isleworth Says:

     
     

    Name of issuer

     

    Targa Resources Corp

     

    Industry 

     

    Energy – Oil & Gas

     

    Security type

     

    Common Stock

     

    Expected size of offering

     

    13,750,000 Shares

     

    Expected price range     

     

    $19.00 to $21.00 per share

     

    Offering type

     

    Initial Public Offering

     

    Distribution by

     

    Selling stockholders

     

    Expected pricing date

     

    12/06/2010

     

    Indication of Interest Period

     

     11/29/2010 to 12/03/2010 by (4pm EST)

     

  45. 45
    zman Says:

    OK, back now. Been watching the market putter about.

  46. 46
    isleworth Says:

    Put in as a table. Sorry it didn't come out that way…….

  47. 47
    isleworth Says:

    Targa Pricing expected on 12/6

  48. 48
    zman Says:

    Isle – no problem. Apologies, but I won't be reviewing as that is a midstream/LNG play…not my thing. 

  49. 49
    BirdsofpreyRcool Says:

    IG — agreed.  The pay freeze is actually an attempt to prevent anyone from moving toward the same sort of pay CUTS that the private sector has had to go through over the last two years.  I would have liked my pay to have been frozen at its high point too…. guess I shoulda gone to work for the Gub-mint.

  50. 50
    zman Says:

    re 49 = LOL

  51. 51
    choices Says:

    Interesting take on another approach to the banksters.
    http://www.economist.com/node/17583123?story_id=17583123&fsrc=rss

  52. 52
    BirdsofpreyRcool Says:

    Frankly, I thought the Budget Commission had proposed an across-the-board pay CUT of 10%… so, "freezing pay" at the all-time high is just another payoff to the Gub-Mint Unions… imho. 

  53. 53
    cargocult Says:

    bop- do you really work for pay? or get paid from what you earn?

  54. 54
    bill Says:

    shipping panel today
    http://finance.yahoo.com/news/Costamare-Danaos-Corporation-iw-502679607.html?x=0&.v=1

  55. 55
    tomdavis12 Says:

    Z: I did not notice anything re RIG for its move today. Don't have BOP's good teddy bear cam at any good place. You see anything?

  56. 56
    zman Says:

    Tom – Nope, could be oil but then I don't get that move either. And why the disassociation of it with the group?  I did see an RDC upgrade, maybe something in that note. 

    Sorry to be quiet, juggling a lot of balls at the moment on the tech side. 

  57. 57
    BirdsofpreyRcool Says:

    cargo — #53… ha!  Personal question, eh?  Right now, I run wild and eat what I kill.  But I used to live in a cage at a fancy zoo… where the daily rations were substantial.  One can get fat and find a type of happiness, when caged and well-fed.  But it does tend to kill the animal spirits and ambitions.  Kind of like working for the Gub-Mint.
     
    Still… in time of turmoil, it would have been SWEET to have had MY PAY "frozen" at its all time high.  If American voters can't see through this BS, then we get what we deserve.

  58. 58
    zman Says:

    Tom – could also be BP related, not HAL also bouncing. 

  59. 59
    choices Says:

    #57-Last sentence, BOP-that is exactly the point-the American voters cannot see through the BS, regardless how high the pile is and how pungent the odor is-we are getting exactly the government we deserve-unfortunately, I do not see anything changing because the electorate has been completely dumbed down and the oligarchy is in control-
    sorry, again I violated my 2011 resolution.

  60. 60
    jiveyjr Says:

    re: 57 Winston Churchill once said…and I'm paraphrasing "if you want to lose faith in democracy have a five minute conversation with the avg. voter"
    the system is what it is…and people are what they are

  61. 61
    zman Says:

    CXPO up 3% on no news and what I'd call OK volume for it. Catalysts in the near term are on the catalyst list but to save time there are two middle Bossier wells that could prompt a news release any day now. This may be a buy the rumor sell the news event as I would not expect either of those to be gangbuster wells (more just a credibility thing although they obviously would help cash flow and the process of these guys turning the corner on their production growth). So if it pops into the news I am more inclined to sell (again, depending on the rates of the wells and other commentary in the release which should give color on timing of the Eagle Ford test (around year end)).

  62. 62
    1520sbroad Says:

    eia data out

  63. 63
    BirdsofpreyRcool Says:

    choices — it's a quiet day, so I'm going to do a little more of my OT stuff.
     
    Saw a great show on Nova (i think it was) about the domestication of the pet dog.  Dogs are directly related to wolves, but you can NOT domesticate a wolf.  No matter how much you "nuture" it.  Domestication takes generations and generations of selective breeding.  The Russians have been doing an incredible study on domestication, using foxes.  Study started in the 1950s, so they have something like 50 generations of foxes, bred to be domestic.  The difference between the domesticated foxes and foxes in near-by pens is night and day… both behavior-wise (aggression) AND physical trait-wise (cuter facial coloring, curly, shorter tails, stubbier faces).  Anyway, to make a long story shorter, the more "domesticated" the animal becomes, the more "childlike" their behavior.  Basically, being domesticated means the animal never has to grow up and develop Adult Characteristics (like taking care of itself).  So, the more domesticated the animal, the more it depends on its Master to feed and protect it. 
     
    It is pretty interesting to think about how this might pertain to humans.  We seem less grown up (parents dressing and acting like kids, not vice versa) and our obsession about someone "keeping us safe"… even though the Real World isn't safe.  We are dealing less and less with "adult" characterics as we become more and more "domesticated" (think "metro-sexual male").  Anyway, this might not be a bad trend… except that it's not going in at the same pace in all parts of this world.  As we become more and more like lap dogs, other places are breeding more and more wolves.  This will end poorly for the lap dogs, me thinks.
     
    If you get a chance to watch the show, it's quite interesting.  They didn't make the comparisons to man, that was my own extrapolation.  But we are all part of the Animal Kingdom, aren't we…

  64. 64
    zman Says:

    re 1520 – thanks, looking now. 

  65. 65
    italyinvestor Says:

    BOP – I agree with 63.  There are a lot of pure bred human wolves over here – lots.  But then again I'm on the govt payroll as well. 

  66. 66
    zman Says:

    September EIA in a nutshell:

    Lower 48 Gas production was up 0.4 Bcfgpd from August to 62.2 Bcfgpd, not great. Flat TX, OK, NM, WY, down Gulf but up in other states (Marcellus, Fayetteville most likely culprits but EIA still not breaking out the new rising star production states – probably takes them a couple more years to break out PA and WV and maybe AR and CO).  I'll have the slide show out tomorrow but for now I'd call this gas price bearish as I had seen some Street comments looking for a rollover here … I think a roll is premature given the drilling we've seen, the public company results ytd, and the giant backlog of wells that have been drilled but not yet completed in the rush to hold acreage pre lease expiry.  

  67. 67
    zman Says:

    AREX – can I get a technical read there?

  68. 68
    BirdsofpreyRcool Says:

    Italy — good point.  However, "Govt Payroll" and "Military Payroll" are not interchangeable words to me.  I would never consider a TSA Agent to be on the same level with our Military Personnel.  Much less, the same mindset.  Thank you for protecting us.  Even wolf packs need to be able to sleep at night.

  69. 69
    BirdsofpreyRcool Says:

    Reef's Ultimate SDM, LEI, is having a nice go of it today.  Guess M&A activity in the EFS is berry berry good for little LEI.

  70. 70
    BirdsofpreyRcool Says:

    LEI — news out!

  71. 71
    BirdsofpreyRcool Says:

    LEI  = another homer for Reef!

  72. 72
    cargocult Says:

    bop-I take it you think Americans are more like lap dogs.  And yet our violent crime rates lead the world, developed and otherwise. Ditto personal gun ownership. And the percentage of our GDP directed towards the means of destruction leads as well, even as we decrease investment in the means of production. And how many other countries are involved in 2 wars simultaneously at this moment? With an all volunteer military. lap dogs?

  73. 73
    Zorgnak Says:

    re AREX…Looking

  74. 74
    zman Says:

    LEI – up 31%, probably what's dragging little CXPO up 5%, I'd think MHR would rally here as well. 

  75. 75
    reefguy Says:

    LEI- Has direct offset leasehold to Denali.  See marathon deal…

  76. 76
    zman Says:

    NOG holding near its highs post secondary, they speak at Canaccord tomorrow. 

    LEI news should probably float GST higher too. 

  77. 77
    BirdsofpreyRcool Says:

    cargo — You generalized my thesis too much, if you will.  My point is that too many voters are lap dogs and assume the rest of the world is too.  Not all Americans are Lap Dogs, and not all Lap Dogs are bad.  But when a Lap Dog meets a Wolf, you can be pretty assured what the outcome is.  The point is, to approach reality with open eyes.  We can't send in a pack of lap dogs to fight wolves.  And we can't expect wolves to become lap dogs.  Nature just isn't like that. 

  78. 78
    BirdsofpreyRcool Says:

    Reef — LEI PR says they calculate NAV atr $6/share.  What is your current thinking??
     
    Way to go, Reef!!

  79. 79
    zman Says:

    Denali coming public soon?

  80. 80
    ram Says:

    RE63  Lap dogs – no.  I feel pretty good to be here with our government – with the good and the bad.

  81. 81
    choices Says:

    Italy-agree with BOP-you are not on Govt payroll-you are earning your military pay in spades regardless whatever one thinks of our current situation-you and your troopers salute and carry out the mission-try that with the bureaucrats and political hacks in DC.
    Cargo, you make some good points, seems that over-generalization about all Americans is not totally accurate but we do have lap dogs, e.g. the political hacks come to mind.
    Saw a note where some Hispanics are going to start a Tequila Party to balance the Tea Party.
    It is indeed a slow day!

  82. 82
    reefguy Says:

    I think Denali exits via sale of assets rather than public.  Lei- $6 bucks is pretty agressive…

  83. 83
    BirdsofpreyRcool Says:

    ram — The USA is still the Best Place in the World to be.  Agree 1,000%

  84. 84
    reefguy Says:

    GST- I can now find eight reals players including CHK in courthouses in Leon, Madison, Grimes county for EF/Woodbine.  Now paying  $500 1/4 royalty

  85. 85
    BirdsofpreyRcool Says:

    Reef — the best ways (purest exposure) to play those counties are GST and LEI, is that correct?

  86. 86
    zman Says:

    Reef – thanks much, nice work re LEI. 

  87. 87
    zman Says:

    Natural gas down 4.5%, simply too much production and too much in storage. It's going to be a bumpy but range bound winter. 

  88. 88
    reefguy Says:

    LEI- Wilson and Gonzales   GST is Leon

  89. 89
    RMD Says:

    someone is liking CPE today also.

  90. 90
    zman Says:

    Reef – much further south and you enter the gas window, cartoons I've seen have it crossing the top of Bee County. Which explains the not too distant away CXPO run today (even though they have little in the way of acreage to run with there). Do you have any other little names that would benefit more close by?

     http://geology.com/county-map/texas.shtml

  91. 91
    zman Says:

    Guru – please check your email.

  92. 92
    Zorgnak Says:

    AREX
     Consolidating in a $1 range between  $18 and  $19 after September's breakout.
    A break of 19 suggests a short term upside test of $20.38 and a target of $22.73 before major resistance.
    Nearby support at $18 with major support at $15.53

    See Chart http://www.charthub.com/images/2010/11/29/AREX_Daily

    See chart http://www.charthub.com/images/2010/11/29/AREX_2

    Check out the AREX_2 chart. Seldom see a low volume stock that marches to such an orderly beat.

     

  93. 93
    zman Says:

    Much appreciated Zorg, will go look at that link. 

    Something lighting a fire under S&P/XLE

  94. 94
    zman Says:

    re 92. Link 2 above looks like it's waiting on a catalyst. Will be adding them to the Catalyst List at next update. 

  95. 95
    zman Says:

    With this little rally off the lows in the S&P and oil up above $85, WLL has turned and is within a hair of taking out the highs, just in time for an operations update. CFPS estimates continue to drift up here. 

  96. 96
    RMD Says:

    94 = a bit like being on the "Approved List".

  97. 97
    zman Says:

    re 96 – I'm not so arrogant as to have come up with a name like that. I did think about a member's tout list though. Reef – for GST, LEI and others, you for AREX at a minimum, Eli is in there with a hand grenade or two, MP for TGA … probably would be a long list. Hmm, maybe a max of 3 per player. 

  98. 98
    Zorgnak Says:

    GST getting some volume

  99. 99
    BirdsofpreyRcool Says:

    Lately, all it takes for our market to turn around… is for Europe's market to close.

  100. 100
    zman Says:

    Thanks again Reef, just saw the MRO deal

    http://www.upstreamonline.com/live/article237970.ece

    WLL through $110, new cycle high. 

    KOG – nice volume

  101. 101
    zman Says:

    KOG December $5 calls awake. 

  102. 102
    zman Says:

    S&P green. 

  103. 103
    1520sbroad Says:

    #101 – Z – do you have any thoughts on the timing of updates from KOG vs 12/18 expiration?

  104. 104
    zman Says:

    The more I look at today's natural gas supply data the more I think sub $4 in the very near term. Unless we get protracted cold this will be a very real problem for the gassy names. Note that most gassy names are very lightly hedged for 2011. Notable exception is HK. 

  105. 105
    zman Says:

    re 103. I doubt it but you never know. They have a bank line redetermination that should be out soon.  They could drop a couple of wells in with that and give us an update but the timing on those wells may be too tight. I think they have production on one well since the last update was out, not sure if any others are producing yet. Weather has been disadvantageous for completions up there the last few weeks I understand … so things get more costly and slow down. 

  106. 106
    ram Says:

    EXXI and MMR seemed to be tied at  the hip with an anchor.  Could this be an offshore penalty box?

  107. 107
    zman Says:

    I think people wanted news there today…. it never comes out as quickly as people would like. Schiller should have struck a more cautious tone on the log comment on that conference call last week.  Other offshores are treading higher. 

  108. 108
    zman Says:

    EXXI speaks at Jefco Dec 1, might be able to talk then, would need to see a MMR press release at the same time. 

  109. 109
    ram Says:

    Yes, makes sense.  Thank you.

  110. 110
    BirdsofpreyRcool Says:

    KOG — someone musta sighted completion rigs on site….

  111. 111
    zman Says:

    KOG = wow. Also, WLL, BEXP, NOG, OAS all pushing towards or at new highs. 

    VYOG – I'm not planning on playing but it looks like it wants to run. 

    Need to take another look at CRED and CXO who are Bakken small but otherwise interesting. 

  112. 112
    1520sbroad Says:

    #105 – thanks. making at run at $5 as we speak.

  113. 113
    1520sbroad Says:

    decent interest in those KOG $5s today as well

  114. 114
    zman Says:

    beerthirty

  115. 115
    zman Says:

    EXXI on the tape with cash tender for 16% second lien juniors. 

  116. 116
    ram Says:

    Re 115 – Is that good or bad?

  117. 117
    elijahwc Says:

    Hi All:  Actually a pretty decent two sided market in EXIXF cvts today.  299 to 299.50, 2m by 2m. 
     
    Reef, what wonderful news on LEI.  You PPRTF +28% not too shabby today either.
     
    I'd be calling the main squeeze (that would be the wife in my case) and asking what the dinner plans ought be.
     

  118. 118
    reefguy Says:

    eli- Everytime I call the Chief I get another tax deduction…I got six young traders already!

  119. 119
    zman Says:

    re 118. LOLOLOL. Any thoughts re 90?

  120. 120
    BirdsofpreyRcool Says:

    Tender = Treasuries +50bps.  That is pretty heavy-handed… and therefore pretty typical of EXXI's decisions on their balance sheet.
     
    Those notes had to go, however.  They are 2nd liens and therefore restrict access to bank capital.  No suprise.  Just a heavy hand. 
     
    Let's just say that I am WAY more impressed with Schiller's ability to buy and develop hard assets… than I am with Griffin's oversite of the financing.  Yin and Yang, if you will.  (Or — better yet — Savant and Idiot.)

  121. 121
    zman Says:

     

    re 116 – I'd put it in the slightly positive to non-event category. Good to get rid of the 16% but not sure what they paid yet. 

    EGY on the tape with an update, will have in the morning post. 

  122. 122
    elijahwc Says:

    Hee hee….reef, it's time to fill out the outfield

  123. 123
    zman Says:

    EGY – I have note calling for South Tchibala well expected to come on this quarter at about 2,000 boepd, on the tape at 3,800 bopd. 

  124. 124
    reefguy Says:

    90- not pure enough…

  125. 125
    RMD Says:

    Ohio keeps popping up:
    CNX announced a Utica shale discovery in Eastern Ohio. The vertical well encountered 200’ of Utica at a depth of 8,450’
    and produced 1.5 MMcf/d unstimulated. CNX will drill a horizontal well from the same wellpad.

  126. 126
    zman Says:

    re 124 – yeah, me either. 

  127. 127
    elijahwc Says:

    Utica – MHR rumored to be there with a deal

  128. 128
    elijahwc Says:

    OAS – tape buys 10,000 acres

  129. 129
    elijahwc Says:

    OAS from briefing:
     
     
    OAS Oasis Petroleum announces acquisition of approximately 10,000 acres in the Williston Basin for total consideration for the transaction was $30 mln (24.92 +0.32)

     
    Co announces that on November 24, 2010, the Company signed a Purchase and Sale Agreement to acquire approximately 10,000 net acres of land primarily in Richland County, Montana and approximately 200 barrels of oil equivalent per day of current production. Total consideration for the transaction was $30.0 million ($26.5 mln of cash and approximately $3.5 million of assets). The acreage is 95% held by production and is primarily operated. As operator in this area, Oasis expects to drill and complete future wells consistent with completion practices used in other operated areas, and expects Estimated Ultimate Recoveries within its current ranges published for West Williston.

  130. 130
    crysball Says:

    EGY~3800 BOPD Flow   on S. Tchibala  Dev. Well
    Can't  seem  to access  the Q3  CC,  but  according  to my  notes  3,800 BOPD  is  above   any  expected  flow rate for the  S. Tchibala  well.
    We are also  within  4 weeks  of  2 more  catalyst  events:
    ~Flowrate    on the  Etame 7-H  well,  which is currently  being tied  back  to the FPSO   with new flow lines  and a subsea completion…..Vaaco  had earlier projected  a  flowrate  of 3,200  BOPD (NET 

  131. 131
    crysball Says:

    (net  after  deducting the  800 BOPD  from  ETame-1V  which  will be  shut down  when Etame 7-H is bought on line  as  the  Etame-1V  has a high water cut and  is  waxed  up)…………note  they will also  take a signinficant bump  in proven  reserves  as  the  Etame-7H reeservoir  proved  to be much larger  than expected.  Note Etame07H is an OHGP  completion
    ~Outcome  of  drilling the   Omangou   Vertical Well exploration  prospect  (which should  finish  prior to the end of December.

  132. 132
    zman Says:

    Crys – I wrote down 2,000 bopd expected for that well. 

  133. 133
    crysball Says:

    Frosting  on the Vaalco  Cake   before year end would  be  an announcement  on  the selection  of   partner for   Blockk 5 Angola…….however,  Vaalco likes  to meter  out  the amount  of Good News   in a controlled way……….so  don't expect this  announcement  until the  end ofQ1. 2011 ..at which time  they will   have  competed  the  Etame  evaluation study and  have  a firmer  estimate  of    2011 CAPEX, and Angola Drilling  Plan timing [likely 2 Semisub  Vertical Exploration wells   in Q4 2011].

  134. 134
    crysball Says:

    Z  2,000 BOPD   for  S. Tchibala   is what  I have  in my notes.

  135. 135
    zman Says:

    re 134 – right, thanks, so they blew the doors off the expectation. 

  136. 136
    Dman Says:

    Z – #97   we don't want BOP limited to only 3 ideas   🙂
     
    BOP – very interesting point about domestication.  We've had a long period of peace and prosperity, where you can get away with being a lapdog. But the current cycle is clearly headed in a much darker direction and there are wolves aplenty in this world.  However I think the wolves of most concern to US citizens are those who say, with a straight face, that you should meekly accept being groped (and your teenage daughter too) just for the right to get on a plane.  Lets pretend for a moment that this actually increases safety (the red teams have shown that it doesn't, it's still easy to get things onto planes). But lets pretend that hiring minimum-wage gorillas to go on a grope-fest actually improves safety. Then why not take it further and be even safer? Subject every passenger to a cavity search. That may sound crazy but the current idiocy would have sounded impossibly crazy a few years ago. 
    Having created a society of obedient lap-dogs, the wolves in charge of all this think that it is now too late to be honest and say, "you know what, complete safety doesn't exist. If a terrorist appears on your plane, you need to take him down".
     Sad really, considering that the passengers on the 4th plane on Sept. 11 already figured that out for themselves.
    Oh and BTW, I'd like to see a complete list of all the senior government (WH and congressional) personnel who are conveniently excused from the gropefest.

  137. 137
    zman Says:

    re 136 – good point re BOP. Didn't read the OT stuff as I'm jammed at the moment. 

  138. 138
    zman Says:

    OK – I did see the word gropefest and so had to read the last sentence.  Funny. 

  139. 139
    BirdsofpreyRcool Says:

    Dman — if it wasn't so NOT FUNNY, I would be laughing at your post… do not get me started on the TSA.  It represents EVERYTHING that is just wrong (and wrong-headed) about our government.  Saw the title to an op-ep piece today (didn't read, but the title summed it up nicely)… "Treating Terrorists Like Americans… and Americans Like Terrorists."  If we don't stand up to the complete idiocrasy of this, I don't know what we WILL stand up against.
     
    No.  Complete safety does not exist.  And it certainly does not co-exist with freedom and free choice.

  140. 140
    zman Says:

    BOP – FYI, I sent that guy a nice note with questions attached. 

  141. 141
    BirdsofpreyRcool Says:

    z — i think that is one we should follow up on.  Perhaps after they get cranked up, you can get them to do a conf call with your members.  Just a thought….

  142. 142
    Dman Says:

    #136 continued…
    When you consider that the father of the panties-bomber actually told the USG well in advance that his son was dangerous, in the hope that he would be stopped *before* he did anything, but that the USG didn't even bother to take this warning seriously, it becomes clear that whatever the purpose of the ever-growing security state is, keeping people safe has little to do with it. Keeping people scared would be more like it. Ruling through fear is an ancient practice, which the US constitution was written to prevent. But a piece of paper can only work for so long if the citizenry are reduced to asking "Daddy" to "please keep us safe".

  143. 143
    zman Says:

    re 141. Agreed. 

  144. 144
    BirdsofpreyRcool Says:

    Dman — BINGO. 
     
    And "YIPES!!"
     
    "A government big enough to give you everything you want, is a government large enough to take everything you've got."  Or something to that affect.

  145. 145
    Dman Says:

    Z – can you update the ZIM spreadsheet? Or am I missing something? I've been away for a bit.
     

  146. 146
    zman Says:

    Dman – will do for the morning. Currently holding 3 sets of MMR calls, 1 set of EXXI, 2 KOG positions, and 2 WLLs. 

  147. 147
    BirdsofpreyRcool Says:

    Just to complete the loop… here is the PBS Nova show about dogs.  Fascinating!  (I am sure it will air again, sometime.)
     
    http://www.pbs.org/wgbh/nova/nature/dogs-decoded.html

  148. 148
    Dman Says:

    BOP – I have to admit that I'm coming around more and more to a libertarian viewpoint. For example I find that Doug Casey makes a lot of really smart observations about a lot of things. But then he goes ahead an advocates anarchy (literally) and I think, well, he may have a lot of smart observations but he's also a bit crazy. I don't have a convenient solution to this fundamental problem of the human condition. No really, I don't! I would tell you if I did, honest.  But I am perturbed at the increasing tendency for ordinary people to "do what they are told" by people who look and behave like thugs, and I'm sure this is a bad thing.

  149. 149
    Dman Says:

    #147 thanks.  I need all the help I can get decoding my dog's thoughts… although she seems to read mine without effort 🙂

  150. 150
    BirdsofpreyRcool Says:

    Dman #149 — that is precisely one of the main points about the show.  Your dog knows you… much better than you know your dog.  Not "new news" to any dog owner, i would guess.
     
    And not all Libertarians are nuts.  Just most of the ones who actually run for office.  (sadly)
     

  151. 151
    BirdsofpreyRcool Says:

    Dman — BTW, welcome back!

  152. 152
    Dman Says:

    Thanks BOP.   Some funnies for you:

    Classy:
    http://www.youtube.com/watch?v=KucnZVKZfKQ&feature=player_embedded
     
    Not so classy, but funny:
    http://www.liveleak.com/view?i=118_1290452447

  153. 153
    Dman Says:

    OK, "not so classy" was a bit of an understatement. Funny, but in a sort of cringe-worthy way.

  154. 154
    RMD Says:

    152 and you don't have to speak the language to understand.

  155. 155
    learn from here Says:

    learn from here

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