26
Nov

Tuesday Morning – Oil Preview Plus JONE

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Market Sentiment Watch: Market focused on data today and tomorrow morning then watch for volumes to dry up. In energyland some nervousness remains over the "deal of three decades" with Iran but the reaction in the WTI was mildly nervous at best and Brent actually rallied yesterday.  In today's post please find a quick run through of oil production by major producing country vs demand expectations and some brief comments on JONE.

Ecodata Watch:

  • Housing Starts are now listed as Delayed,
  • We get Building Permits at 8:30 am EST (no forecast, last read was 926,000),
  • We get Case-Shiller home prices at 9 am EST (no forecast, last read was 12.8% YoY),
  • We get FHFA home prices at 9 am EST (no forecast, last read was 8.5% YoY),
  • We get Consumer Confidence at 10 am EST (F = 72.4, last read was 71.2).  

In Today’s Post:

  1. Holdings Watch
  2. Commodity Watch - plus oil supply and demand slides 
  3. Stuff We Care About Today – JONE,---------
  4. Odds & Ends

Click the link directly below this to ...

break

Holdings Watch:

ZMT (Zman Medium Term portfolio):

Yesterday’s Trades: None

ZLT (Zman Long Term portfolio)

Yesterday’s Trades:

  • COG - Added a second piece to the Core position at average $35.05.  Gassy name that's retreated lately on what we see as transitory local natural gas price issues. The name remains a gassy stalwart go to story in our view and is part of plan to slow inch up natural gas exposure within the ZLT. The company will generate free cash flow next year and the excess cash is likely to go back into a combination of share repurchases and acceleration of their Eagle Ford program.

​The Blotter is updated.

Commodity Watch

Crude oil eased $0.75 to close at $94.09 yesterday, moving off on some amount of fear that the deal with Iran would lead to increased volumes from the country near term. We think it's likely down the road but not much of a near term concern and that OPEC leaders will manage the situation when it occurs. This morning crude is trading up slightly.

  • Early Read on Oil Inventories:
    • Crude: Up 0.25 MM Barrels
    • Gasoline: Up 0.4 MM Barrels
    • Distillates: DOWN 0.8 MM Barrels, not a big number in and of itself but this level would ease past the year ago week as a recent cycle low and you have to go back into the 1990s to surpass it ... distillate stocks are very understored, again, going into winter ... look for this and stronger HO prices to be a reason for utilization to rally more sharply than previously expected out of the maintainance season). 

Crude Production Watch: Just a few visuals 

crude supply 112513

Crude Demand Watch: 

crude demand 112513

 

Natural gas rose two cents to close at $3.79 yesterday in very light trading, moving up quietly on the colder than normal forecast for the lower 48. We have not yet seen a consensus expectation but one should form up this morning given the inventory number will be released a day early due to the Thanksgiving holiday.  This morning gas is trading up slightly. 

Stuff We Care About Today

Jones Energy (JONE) announces mid-continent aquisition - time for a quick update on this unowned name. 

We did a brief review just prior to IPO in July 2013 here.  In a nutshell we said it was interesting, they appeared to be conservatively run and we'd check back once it came public or at least closer to the deal. We got busy doing other things, the IPO priced below the range at $15, was initially weak but the stock rallied about a month later from the high $13s in late July to as high as $18 in October before giving it all back in the last five weeks. The drop was caused by a) a hit to their oil mix (down 2% from 2Q13) due to a non core property issue, b) higher than expected LOE on workover activity, c) higher capex guidance without a bump in volume guidance, and d) a take-no-prisoners type sloppy group.
 
Last night they announced a $195 mm acquisition in the Mid-Continent (TX/OK Panhandle): 
  • Adds 26,000 net acres (largely already HBP'd at > 90%) in the Cleveland play of the Anadarko Basin, bringing their net acreage position to 107,000.  New acres are in and around existing position. 
  • Adds 186 net Cleveland locations bringing total inventory in the Cleveland to > 700, (total company well over 2,400 locantion all in the stacked pays of the region). 
  • Adds production of 3,400 BOEpd (54% liquids and we'd think roughly evenly split but they'll get asked on the conference call) yielding a pro forma current rate of 21,900 BOEpd,
  • On a production valuation basis they are doing the deal at ~$57,000 per flowing BOE vs their own valuation of $66,000 per flowing BOE as of last night's close,
  • On a reserves basis they are adding 14.3 MMBOE (59% liquids), (acquired at $13.64 per BOE).  On a pro forma basis, JONE is trading at $9.89 per 1P BOE.  
  • They plan to add 2 rigs to focus on the new acreage bringing the total up to 12 for 2014 and we should get more color on the cost of the 2014 program today,
  • They are using available capacity on the revover to fund the acquisition and given their new we'd expect them to term that out shortly with fairly low cost senior debt,

​Other JONE Stuff:

  • Cleveland production made up 61% of total volumes in 3Q13 and the unit's produciotn was 67% liquids in 3Q13 (vs 54% for the total co in the quarter),
  • They are drilling wells faster, despite having longer laterals and completed well costs continue to fall in the Cleveland. This may be a high NGL's play but the low wells costs ($3.1 mm all in) are helping to drive IRRs to "Bakken light" like levels,
  • 30 day average rates have been steadily increasing quarter by quarter e seen some recent wells in the 600 to 700+ IP30 BOEpd range, 
  • 53% of volumes are now oil (note their liquids mix below has a lot lower oil content to it now so the focus here (9 of 10 currently active rigs) makes a lot of sense,
  • The reduced costs and improved performance of the wells has led to IRRs moving from 
  • They are now moving from open hole completions with 20 stages (1 frac per stage) to cemented liners with 23 stages (3 fracs per stage and 1/3 more proppant per frac) and they see that driving higher EURs and expect to talk about results in 1Q14.  

Nutshell: Unlikely they overpaid given a) the stacked pay potential here (Cleveland, Marmaton, Tonkawa and many more on down the column of the Granite Wash), b) the fact that it's almost completely HBP, and c) has as such been derisked but has currrent significant production. Our sense is that the idea of the new completion methodology combined with a larger prospect inventory and an ability to increase the oil mix will be well received by the Street going into year end.  As noted in September, these guys have planned to keep their drilling budget close to cash flows and have been doing so this year, and we expect similar discipline next year. Estimates will be going up with the boost from the inorganic additional volumes but growth of 35% next year was already expected and the name is currently trading at 4.5x pro forma TEV to stale 2014 EBITDA.  If we assume they just the acquired volumes flat next year, the new pro forma TEV to pro forma EBITDA multiple for 2014 falls to roughly 3.9x while growth moves up to 55% YoY.   We don't own the name but think it's probably too cheap at this time to stay at current levels for long given the large inventory, rapidly (albeit largely inorganic) growth, plan to stay keep the budget closely tied to cash flow, and gradually rising margins as oil inches higher in the mix. 

 

Conference call to discuss the deal is set for 8:30 am EST this morning. 

Here's a link to their presentation this morning

A brief cheat sheet follows:

JONE 112513

 

Other Stuff

  • EOG issued a press release urging shareholders to reject a mini-tender offer for 1 MM shares of EOG by TRC capital for $162.75.  Not sure why anyone would take TRC on this offer but stranger things have happened. 

Other Other Stuff

  • Look for the Gassy Players update piece in tomorrow's post. 

Odds & Ends

Analyst Watch:

  • BTU - Macquarie ups to Outperform (a rare upgrade for any coal name of late)

108 Responses to “Tuesday Morning – Oil Preview Plus JONE”

  1. 1
    zman Says:

    Getting on the JONE call, notes in a bit

  2. 2
    Zorgnak Says:

     

    S&P Short Term Areas of Interest  11/26 5:36    ES 1803.25/ SPY Chart Below. (SPY levels).

    Notes……Market tested and rejected the 1800 level as too low. Little market structure in either direction. Demand volume and breadth positive. Big cap over small cap. Previous high beta leaders underperforming. Financials leading. Low volume holiday trading.

    Thoughts ……… Edgeless short term chop above 1800 range break. Watch to see if market gains acceptance after range extension and meltsup in low volume holiday fashion. Long term uptrend intact. Expect any dips to be bought. Do less. 

    Glossary   http://www.futurestrader71.com/?page_id=1280

    1800.50                           CLVN/Range High

    1788.50                          Minor CHVN/Current Volume Pivot (179.32)

    1782.25                          Minor CLVN (178.75)/Volume Gap Below

    1774                                CLVN

    1771                                 Previous range high.(177.55)

    1758.50                            CHVN/Current Volume Pivot(176.43)

    SP500 Futures  

    http://www.charthub.com/charts/2013/11/26/es_master_131126050918

    SPY

    http://www.charthub.com/charts/2013/11/26/stock_master390_131126052825

  3. 3
    Dedwards Says:

    Concho has a nice slide in its Nov Presentation giving a little color on the Reeves/Pecos section of the Delaware Basin. D&C $8.5-10.5M, 500-700 Mboe EUR, oily, IPs improving… Early days in the location, but looks interesting.  http://phx.corporate-ir.net/phoenix.zhtml?c=211775&p=irol-presentations

    FST holds acreage just to the SW of where Concho is.  Could be useful to watch CXO's results here for a read on FST's prospects.  Unfortunately, there is no indication that the Southern Delaware Basin has the same kind of stacked pay potential as the Northern Delaware Basin.

  4. 4
    zman Says:

    Analyst Watch:

    JONE – Suntrust ups target from $20 to $22, rating Buy,

    Call starting now. 

  5. 5
    milepost_43 Says:

    Additional 225,000bpd of Bakken takeaway capacity in 2016…NOTE last sentence below

    Marathon Petroleum Corporation ("MPC") has been secured as an anchor shipper for the $2.6 billion Sandpiper Pipeline Project ("Project") component of Enbridge's overall $6.2 billion Light Oil Market Access Program ("LOMA Program") which was announced on December 6, 2012. The LOMA Program consists of several distinct projects which will collectively allow an additional 400,000 barrels per day (bpd) of light crude oil from Western Canada, and from the Bakken formation in North Dakota, to access premium markets in Eastern Canada and the U.S. Midwest. MPC will fund 37.5% of the Project in exchange for an approximate 27% equity interest in the North Dakota System.

    The Sandpiper Project will expand and extend the Partnership's North Dakota feeder system. The Bakken takeaway capacity of the Partnership's North Dakota System will be expanded by 225,000 bpd to a total of 580,000 bpd with a target in-service date of early 2016. The expansion will involve construction of a 24-inch diameter line from Beaver Lodge, ND, to Clearbrook, Minn., and a 30-inch diameter line from Clearbrook to the Superior, Wis., mainline system terminal.

    Enbridge's Neutral Footprint program also ensures that a tree is planted for every tree removed during construction and an acre of land is conserved for every acre of wilderness permanently impacted.

  6. 6
    zman Says:

    JONE Notes

    – 24% oil in the acq, same as what they hold now in the Cleveland

    – gross capex goes from $3.1 mm per well to $4 mm with the new completion method

    – current IRR on those wells on the strip is up 80% range, won't guide on where that goes on new fracs without seeing data

    – 2014 guidance was set to be released in December; now probably Feb 2014 … want to see results of new wells

    – capex for 2014 is likely higher than I had in the post, sounds like they go to the new frac method for all 12 rigs. 

    – all analysts congratulating them on the deal

    – reminding reserves of 84  MMBOE is a simple add of reserves from this deal, less the loss of some reserves from another deal that didn't happen, to the 2012 ye reserves, so no activity from this year in the reserves number, mix shifts oilier on this add. 

  7. 7
    zman Says:

    Buidling permits strong at 1.03 mm annual rate, highest level since June 2008. 

    Case-Shiller up 13.3%, ahead of estimates. 

  8. 8
    zman Says:

    re 5 – thanks – no takeaway issues seen at this point over the medium term. Impressed with how rapidly the Bakken Players can now switch between rail and pipe depending on end market conditions. 

  9. 9
    Dedwards Says:

    Z, thanks for the work on JONE.  I'm a believer.  Buying some at the open.

  10. 10
    elduque Says:

    BDI up 20 to 1512

     

    Brent/WTI at 17.4

     

    TYX at 3.81

     

  11. 11
    zman Says:

    re 9 – you're welcome, may do something there in the ZMT

  12. 12
    elijahwc Says:

    Helene Meisler noted the interesting price recovery in oil yesterday as follows: 

     

    "I wanted to revisit the chart of oil now that everyone is fascinated with the Iran deal. The commodity itself hasn't broken up or down — it's still trading in the range in which it's been three weeks. I still think oil will eventually breakout to the upside. It did try to whoosh down Monday, and it did not manage to break. On a breakout to the upside, I would look for it to tag that downtrend line near $98 per barrel.

  13. 13
    zman Says:

    Analyst Watch

    MPO – Johnson Rice out saying MPO is a play on the JONE acquisition, same area and JONE paid 20% more per acre on a bit of a convoluted price per adjusted acre metric (they do note that JONE has had better results with the drill bit however). 

  14. 14
    elijahwc Says:

    #12 her chart failed to embed…sorry

  15. 15
    zman Says:

    re 13 – thanks and re 12 – I agree with her, deal over rated, many expected a big downdraft (the Kerry Trade) but I just don't see it. See graphs in today's post, plent of space for a 1 mm bopd rise in exports from Iran to be absord on both sides (supply and demand). 

  16. 16
    zman Says:

    ZTRADE – ZMT – JONE

    JONE – Added a position in the ZMT for an average of just over $14.67. Looking for catalytic news in the next 4 months. Please see today's post and comments section for comments on their low cost acquisition in the mid-continent last night. Estimates will be going up and we see catalysts in the form of guidance for 2014 and new completion method results sometime during 1Q14. 

    ZTRADE – ZMT – BCEI

    BCEI – Sold a long held position (over a year for the ZMT) at just under $45, up 117%.   Moving to make this portfolio a little more true to its "Medium Term" name. 

  17. 17
    tomdavis12 Says:

    Offshore update: Sector has been underperformer for the year due to operational difficulties and right now a declining crude price has led to perception of decreased appetite for additional rig from Majors & Countries. ATW & SDRL have had best performance +15% YTD. SDRL's position is that the older rigs will have to be scraped or stacked and are not in demand nearly as much. (That might be a little self-serving since they have the youngest fleet). That is why they are one of the few that is still building rig inventory (took delivery of 13 rigs in '13). Make no mistake SDRL is the most leveraged play in the space. 60% net debt to cap. and has most aggressive order book by far. If you are a crude bull this space should get a bounce in early Jan after the names don't show as much on year end holdings. I am adding to SDLP which will have more drop downs of rigs with long term contracts and enough work that they may not have to be moved after the contract ends. Expect dividend raises as more drop downs happen. SDLP is a way SDRL can raise more money. NADL is a niche asset. Is meant to be for North Sea & harsh envoirnment drilling.   

  18. 18
    zman Says:

    Thank you Tom, appreciate your consistent updates in the space.  We will be back in OII at some point which seems to avoid a lot of the rig book and aging rig related drama quite well. 

    Speaking of OII, noting it was knocked out of its summer base yesterday.  I did not see news or a downgrade but if I had to guess I'd say another sell sider decided to lock in profits commissions on a strong name.

    Anyone see a reason on the move yesterday

    Zorg and JB – got thoughts on OII (oh eye eye) here?  Guessing its got $73 written in bold on the chart. 

  19. 19
    tomdavis12 Says:

    January bounce: If I am right about the loaded laggards getting a January bounce, the same may be said of some E&P or Z names. EXXI, NOG, HK, NFX, LNCO, SSN & BTU.

  20. 20
    zman Says:

    Today's post free to the public, feel free to blast it out there. Want to keep subscription prices at 2007 levels? Use those little buttons to share it out at the bottom of the post. Thanks. 

  21. 21
    tomdavis12 Says:

    18  OII – actually was added to CapOne focus list yesterday. I agree with your assesment that the street is scaling back their eagerness with the run we had thru 3rd week on Oct. Also for OII we are headed into a seasonally slower time.

  22. 22
    zman Says:

    re 21 – LOL, thanks, I guess he didn't want it breaking that base. 

  23. 23
    zman Says:

    Consumer confidence falls to 70.4, short of 71.2 forecast. 

  24. 24
    tomdavis12 Says:

    22 OII hasn't broken below 200 day for 1.5 years. Kind of Z name that make one all warm & fuzzy.

  25. 25
    zman Says:

    re 24 – hear ya, few surprises, other than modest ones in the "better than expected camp" … falls into the easier to own category despite me not currently owning it. 

  26. 26
    DaveH Says:

    RE: 17 SDRL +29.74% YTD including dividends.  

  27. 27
    Zorgnak Says:

    OII     Have half an eye on it.. Most of yesterday's big volume really came in after it hit the CLVN support at 77.24 area. So I view that as a positive. Volume running just below average this morning.  Does it hold 77..24 support or drip to 74.62?  Have to watch the volume at  this level to see if it lifts or not. If not then I'd look for a lower low on less volume above 74.62…Which is what I'd prefer.

    http://www.charthub.com/charts/2013/11/26/stock_master390_131126071222

  28. 28
    zman Says:

    re 27 – me too on the lower low and less volumes, thanks much chief. 

  29. 29
    Zorgnak Says:

    #27  I never seem to get what I want out of this one though…always lifts ahead of my level

  30. 30
    zman Says:

    Hey Zorg – got a read on JONE. Thinking shorter term on that one 3 or 4 months out. 

  31. 31
    zman Says:

    TPLM not apparently worried about Iran either. 

  32. 32
    zman Says:

    … and we still expect them to up guidance, second week of December. 

  33. 33
    zman Says:

    Dedward – you should do a SA piece on your FST idea. 

  34. 34
    Zorgnak Says:

    JONE   Two levels of acceptance   14 and 16 with a volume void in between. I'd expect it will get back to 16…and start to chop around there….Volume pressure above 16.91 would set it up for a breakout higher.

    http://www.charthub.com/charts/2013/11/26/stock_master390_131126072809

  35. 35
    Zorgnak Says:

    Low volume for time of day in E&P

    JONE 2X average for time of day

  36. 36
    zman Says:

    Thanks much for the reads Zorg

  37. 37
    zman Says:

    ATHL- resilience continues. Same PVA,TPLM, and a somewhat surprising number of others. 

  38. 38
    nrgyman Says:

    PDCE:  Been consolidating after recently touching near the 200 dma.  Looks like an inverse head and shoulders formation with the neckline around 61.50–approaching it soon.  Added some yesterday and today.

  39. 39
    Zorgnak Says:

    #37 seeing same…lots of low volume drift higher..sellers tired

  40. 40
    Zorgnak Says:

    OII volume rate creeping higher….move above 77.35 has room to run back to 79…very short term stuff

  41. 41
    Zorgnak Says:

    OII   Intra day chart…not where the volume came in yesterday…sets up a bounce above 77.35 if buyers push at all….

    http://www.charthub.com/charts/2013/11/26/stock_master390_131126080420

  42. 42
    zman Says:

    re 39 – hear ya, market looks sleepy

  43. 43
    zman Says:

    Watching AMZG fade following their quarter and announcement of a move to the NYSE. We'll have more to say there soon. 

  44. 44
    zman Says:

    Crude hanging out at $94:

    http://www.cx-portal.com/wti/oil_en.html

  45. 45
    tomdavis12 Says:

    Curious – option premiums for OAS & EOG have moved up last 3 days without common moving higher.

  46. 46
    nrgyman Says:

    Natgas stock lagging today.  The latest weather forecast shows temperature moderation, no doubt behind some of the natgas weakness.  

     

    http://www.cpc.ncep.noaa.gov/products/predictions/610day/610temp.new.gif

  47. 47
    zman Says:

    Re 46 – Street forming up at -16 Bcf for tomorrow's report as well, soft withdrawal after the good start last week.  

    re 45 – just about has to be the volatility is up a bit, will impact the near month ones more than the longer dated strikes. 

  48. 48
    tomdavis12 Says:

    47  Agreed – was call options I noticed.

  49. 49
    Andy Moore Says:

    z   tried to share today's post w/ my brother, but it only sends first sentence  help!!!

  50. 50
    zman Says:

    WFT on the tape in settlement with DOJ, SEC, Treasury, and Commerce. 

  51. 51
    zman Says:

    re 49

    Thanks, you could send him this:

    http://zmansenergybrain.com/2013/11/26/tuesday-morning-oil-preview-plus-jone/

  52. 52
    macguyver Says:

    Good article on oil in FT: "Toil for oil means industry sums do not add up" By Mark Lewis.  First two paragraphs gives you the gist:

    "The most interesting message in this year’s World Energy Outlook from the International Energy Agency is also its most disturbing.

    Over the past decade, the oil and gas industry’s upstream investments have registered an astronomical increase, but these ever higher levels of capital expenditure have yielded ever smaller increases in the global oil supply. Even these have only been made possible by record high oil prices. This should be a reality check for those now hyping a new age of global oil abundance."

    Won't be a surprise to anyone on the site….anyways…..

  53. 53
    Bill Potter Says:

    The midgets are all weak.  SSN down 14%, AMZG down 3% and OEDV down 5%.

  54. 54
    zman Says:

    Thanks, will take a look. I read/skim the OPEC monthly piece which I generally think is hands down superior to the EIA and IEA and OPEC just put out their annual which I've not yet gotten far into. Here's the executive summary with some pretty far reaching thoughts:

    http://www.opec.org/opec_web/static_files_project/media/downloads/publications/Executive_Summary_WOO2013.pdf

  55. 55
    zman Says:

    re 53 – yep. News on SSN last night was irrelevant, don't know reason for the dip other than people just throwing in towel there.

    OEDV – good 3Q pr, no one cares at the moment, worry of debt likely the issue

    AMZG – giving back the faster run up on the news, actually considering an add there.  

    TPLM sporting an $11 handle. 

  56. 56
    Stewart Says:

    ATHL sure hasn't come in much since eps.  Given the backdrop of profit taking throughout the sector, the relative strength there is even more impressive. 

  57. 57
    Zorgnak Says:

    FSLR   Solar has been getting crushed lately… FSLR not so much. Holding above it's breakout point..

    http://www.charthub.com/charts/2013/11/26/stock_master390_131126092250

  58. 58
    zman Says:

    re 56 – really strong quarter, volumes by time of call were ahead of planned exit, solid 4Q guidance, 2014 expected in January,borrowing base upped a week later as guided, operated horizontal well results soon (noted they were very encouraged by flow back on the shorter one, longer well completing this week), language on the call was everything people want to here including comment about saying they don't set out to beat their guidance but that's not to say they won't be 4q, handily. 

  59. 59
    zman Says:

    re 57 – nice move you have had there. Did you see the JASO news today?   We may have new sub soon who will have more color on the space than I can generally work myself up into offering. 

     

  60. 60
    Zorgnak Says:

    #59  re JASO…no I hadn't seen the earnings. SPWR moving well today off support…FSLR and SPWR are the ones I watch the most…I try to stay away from the Chinese stuff

  61. 61
    Zorgnak Says:

    #59..re Solar color….anything would be more than I know

  62. 62
    zman Says:

    re 61 – hear ya, have had my eyes off the ball there for quite some time now. 

  63. 63
    zman Says:

    Offtopicthirty, grabbing lunch

  64. 64
    reefguy Says:

     MILL; Red flag.  This is the companies IR person. 

    http://www.richardsmodels.com/lifestyle/michelleborromeo/

  65. 65
    nrgyman Says:

    RE 53, 55:  couple of midgets bucking the weak midget trade:  CPE, MTDR

  66. 66
    Zorgnak Says:

    #64

    Looks pretty good to me!

  67. 67
    zman Says:

    re 65 – it's pretty much a strong get stronger, weak get weaker day.  GST and PVA trying to extend as well 

     

  68. 68
    reefguy Says:

    In June 2013, Miller appointed Michelle Borromeo as Vice President Investor Relations. Borromeo was a former nightclub bartender, dolphin trainer and model.

  69. 69
    crysball Says:

    HK getting  weaker…………as  it  breaks  below  4  on approx.   2X  volume…………confidence  in  mgmt.  fading.

  70. 70
    Pati Says:

    #68:  Reef, these guys look pretty happy about it:

    http://www.millerenergyresources.com/leadership/

  71. 71
    reefguy Says:

    Maybe. But more likely because in June they also gave themselves a huge raise and options…..Nice to operate in the Cook Inlet from Knoxville, Tn. on someone else's(shareholders bank roll) dime.

  72. 72
    zman Says:

    re 71 – someone asked me about them prior to the run, think it was in May or June and I passed. Have been noting it leg up, seemed over done and have not heard best things re management in the past.  But didn't know they had a modeling bartender on staff (no place for that on my cheat sheets)) 😉 

  73. 73
    zman Says:

    re 71 – Reef – that almost sounds like a job for the Streetsweeper or Herb G. 

  74. 74
    reefguy Says:

    MILL: Look at size of short position…..

  75. 75
    reefguy Says:

    71-yep

  76. 76
    ButlerBaby Says:

    z- HK has about 75 well permits for El Halcon (i.e. Agula Vado Eagleford and Giddings Eagleford, excluding Woodbine) active in the RRC system, but do you know how many of those are actually producing?

  77. 77
    choices Says:

    #49-worked for me-hope I'm not stating the obvious but for my e-mail provider, it is ncessary to click on the z's title bar for the post to get the full post.

  78. 78
    nrgyman Says:

    WSJ: Sinopec talks with Apache about stake in LNG project • 2:28 PM

    The LNG project on Canada’s Pacific coast – known as Kitimat – is one of several Sinopec (SNP -1.6%) is looking at in that region, according to a source, and management has yet to sign off on the investment. The size and value of the stake hasn’t been determined, but the investment would go towards the project’s costs, which Apache (APA +0.8%) last year pegged at $15B.
    “Apache is moving forward with the project, and we’re looking for partners,” says an Apache spokesman, declining to comment on the talks, though he does say the cost of the project is being recalculated.

  79. 79
    choices Says:

    Z, TomD, or anyone, do you have a site which provides updated info on short stk percentages-my broker just has of 10/31, as I understand it, 11/15 info should be out there.

    Thanks.

  80. 80
    ButlerBaby Says:

    Short info released after market close today

  81. 81
    ButlerBaby Says:

    nasdaq.com – left hand menu bar near bottom – short interest

  82. 82
    BirdsofpreyRcool Says:

    XCO — sigh…

    I know you have covered this one in the past…. but i didn't pay attention.  (Sorry!)

    With Wilbur Ross and T. Boone and Oaktree and BlackRock and Keeley (some of the better investors) all on board, is it one to take seriously?  The company is based in Dallas (negative), pays a dividend (negative, in my book), just lost it's CEO (Doug Miller; could be positive), and is trading at a market cap of $1.17B (vs a MBO offer of $4B a while back).

    So… what's the 60-second overview here?  Thanks!

  83. 83
    Dedwards Says:

    Re 33 – I might just do that.  Could be a good one.  I'll have to get in the stock first tho 😉

  84. 84
    Dedwards Says:

    Re 83 – But then again, I don't want to become just another SA jabroni… I'm torn

  85. 85
    choices Says:

    #80, 81-thanks much!

  86. 86
    zman Says:

    re 82 – overly complex structure in my view, too much debt, CEO just quit and I did a little comment on it in yesterday's post. They really need higher natural gas prices. 

  87. 87
    zman Says:

    re 76 – Re El Halcon, they just started drilling there early this year, so the permit count and well count are a fraction of the location count on > 60,000 net acres. As of September they had 25 producing, a half dozen in process, and have 4 rigs running. 

  88. 88
    BirdsofpreyRcool Says:

    Just yesterday, eh?  I'll toddle over and take a look.  thank you!!

    (Wilbur may have something up his sleeve… he's a guy with a nose for "leveraged" situations.  But he is not traditionally an E&P guy.  Just b/c you did well in steel and auto parts, doesn't mean you are an expert in energy.  Still, the guy's pretty smart.)

  89. 89
    nrgyman Says:

    PDCE scored a Quadruple Top Breakout on the P&F chart today.  Also crossed the neckline of the inverse H&S bottom.  Problem is low volume, so not much enthusiasm after the break out–yet.  May be hard for them to get that in this environment.  

  90. 90
    BirdsofpreyRcool Says:

    nrgyman — call me a "contrarian" (and you wouldn't be far from the truth)… but I think the energy sector will be a popular place in 2014 (if not before).

    And if there is any glimmer of good news from DJ#2, then even old EXXI will see a jolt up and to the right.

  91. 91
    Dedwards Says:

    Re 88 – Uncle Wilbur will never steer you wrong… unlike Uncle Carl!  

    OT BOP: I bought Anatabloc for a colleague with severely arthritic hands.  He reports back that he feels much better!

  92. 92
    BirdsofpreyRcool Says:

    OT:  Ded — That is fantastic to hear!  How long has he taken it?  The results improve over time.  And if you stop, the hurt returns (spoken from personal experience).  Thank you for sharing.

    STSI (soon to be RCPX) is going to be one of the most interesting companies to watch in 2014, 2015… and I've got a "Founder's Circle" Ticket to the show.

  93. 93
    nrgyman Says:

    RE 90:  I'm with you on the energy sector.  The current headwinds may well be the 'wall of worry' these names will climb.  Absent a collapse in WTI prices (which I don't see happening), Z's universe will offer solid, visible growth and attractive multiples–which should eventually make them popular, again.  Regarding the low volume move today, it is a holiday week and volume is low on all of the indices.  Still would like to see a higher volume follow through, but it looks to me like these names are ready to move up again.  

  94. 94
    BirdsofpreyRcool Says:

    #93 — "walls of worry" make for the bestest of ways to go up.  And there are a bunch of Worry Walls out there in the energy sector right now.  Happy with that.

  95. 95
    Dedwards Says:

    Re 92 – Couldn't be more than 2-3 weeks.  Less than a month for sure.

  96. 96
    BirdsofpreyRcool Says:

    OT #95 — that sounds in line with the company's own internal survey.  Thanks again for sharing.

  97. 97
    Dedwards Says:

    GST looking for a $6 holla

  98. 98
    Baylor Says:

    Ssn co to use to disappoint and I continue he to hold. Got overextended there unfortunately. Good lesson to me and none of my lessons are generally cheap. 

  99. 99
    Baylor Says:

    Co to use = continues

  100. 100
    zman Says:

    re 98 – would guess tax loss selling has engaged there. 

  101. 101
    BirdsofpreyRcool Says:

    GST — thougth it would hit $6 when I was doing work on it last summer.  Just thought it would take a year (not 5 months).  But shows you what having the right acreage in the right play at the right time (when no one thinks you are any good at anything) can do for you.  Thank you, Russ Porter.  It's really been a heckuva last 12 months for GST.

    Now thinking much higher is very doable.  The results from the Hunton wells suggest GST's type curve (and reserve estimates) will have to be revised up.  Looking foward to their first two operated wells in the Hunton.  But this play has no where near the "learning curve" challenge of the TMS.

  102. 102
    zman Says:

    Beerthirty

  103. 103
    BirdsofpreyRcool Says:

    z — does Petra still own her Google shares?  Stock hit an all time high today.

    (Helps to have Stan Druckenmiller on your side too.)

  104. 104
    ram Says:

    BOP – Always the cheer leader – good for you.

  105. 105
    BirdsofpreyRcool Says:

    hi ram!  You probably saw this when I posted the other day… but I copied down (verbatim) 3 quotes from a Stanley Druckenmiller interview last week.  He's a bit of a cheerleader too… but his performance backs up his conviction.  He has one of the best (and most consistant) hedge funds return in the industry.  Always helpful to hear how he does it:

    =======================================

     

    "I only focus on what is black or white, and sift out the gray areas."

    "I’ve always made big, concentrated investments. I don’t believe in diversification, I don’t think that is the way to make money.  Put all your eggs in one basket, if you really like the basket, and watch it carefully.  So you may hear a lot of conviction in what I talk about, but that’s because I don’t talk about things I don’t have a conviction about.  And I invest the same way."

    "If there is one message I have for investors and their clients is that you gotta take more risk, you are not going to make money talking about risk adjusted returns and diversification and all that, you have to identify the Big Opportunities and go for them."

  106. 106
    crysball Says:

    EGY  Insider  Buy

    New  CEO    [Steven Gudry Ex-Marathon   Oil] VP]  makes a 33,600  share  open market  buy:

    "And on Friday, CEO Steven P. Guidry purchased $203,112 worth of VAALCO Energy (EGY), purchasing 33,600 shares at a cost of $6.04 a piece. VAALCO Energy is trading up about 6.7% on the day Tuesday"

    He  presented  this  AM  at  a  South  African  Oil  Conference…………slide  presentation  is  on  the  Vaalco  website……….nothing  startling,  but  a  totally  differnt  style than  Bobby Gerry.

     

  107. 107
    zman Says:

    re 103 – yes she does. And her Triangle and her Samson which I'm not soon to forget. 

  108. 108
    best food fidi Says:

    best food fidi

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