20
Jan

Wednesday Morning

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Market Sentiment Watch: Futures weak after IBM fails to impress and a number of banks come up short on earnings this morning. Please note that the EIA oil inventory report is delayed until tomorrow afternoon due to the MLK holiday.

Ecodata Watch:

  • Housing starts: 557K vs 540K forecast,
  • PPI: up 0.2% vs forecast -0.1%



In Today's Post:

  1. Holdings Watch
  2. Commodity Watch
  3. Crack Spread Update
  4. Catalyst Watch
  5. Stuff We Care About Today - MMR wrap, IOC, IPAA presentation schedule, NFX debt offering
  6. Odds & Ends

Holdings Watch:

  • $10KP II:

    • $26,600
    • 30% Cash
    • The Quick View on the Holdings Tab Is Updated.  I'll update the $10 KP II and ZLT spreads tonight.
  • Yesterday's Trades:

    • PXD – Added (5) Feb $50 Calls (PXDBJ) for $2.25 for a quick trade with the stock off about $1 on a little selling following what appears to be solid drilling results from their Eagle Ford program. See comments from today’s post for further details.


Commodity Watch

Crude oil ended the day up $0.95 to close at $79.32 yesterday. Part of the rally was due to the equity market's push higher and part of it was attributable to end of contract closing shenanigans. The March contract takes over as front month this morning and is trading lower by $1+ with equities and other commodities this morning and another rally in the dollar.

  • Early Read On Oil Inventories:
    • Crude: UP 2.5 mm barrels
    • Gasoline: UP 2.0 mm barrels
    • Distillates: FLAT
    • ZComment: Sets the inventory bar pretty low for tomorrow's report. Even if we get the mirror image of current expectations, storage surpluses vs year ago numbers will decline for both products. 

Natural gas fell $0.13 to close at $5.56 yesterday on the back of warm weather. Long range forecasts call for a return to cold in February and I would guess gas remains stuck between $5 and $6 for an extended period.  This morning gas is trading flat.

  • Imports Watch: 12.0 Bcfgdp, down 0.4 Bcfgpd from last week and up 2.4 Bcfgpd from last year.

    • Canada: New recent high at 9.4 Bcfgpd

    • LNG: Send out volumes were 2.6 Bcfgpd last week, down from the prior week's record high 3.5 Bcfgpd.

 

Crack Spread Update


Key Takeaways: Margins remain weak and are starting off the New Year on the wrong foot relative to historic levels. I think the group may get a pop out of a perceived power shift in Congress as that may put passage of an "Energy Bill" that would unduly burden domestic refiners compared to their importing counterparts in jeopardy. I'm going to continue to take a wait and watch attitude here. If I do go in it will be into one of the more liquid names, probably VLO.


 

 

Catalyst Watch:


This week's changes are highlighted in yellow in the table.

 

 

 

Stuff We Care About Today

MMR Wrap:

  • Ok quarter, problems with top line caused a miss on the bottom. Given the timing of well recompletions and a known issue at a Flat Rock well this is pretty easily explained.
  • The Street is more concerned with the ongoing process at the Davy Jones ultra deep play. At present management has stopped drilling at 28,600 feet to log new potential pay in the well. I'd bet we hear something in 3 to 5 weeks but it could take longer. The last 135 feet of pay took about 4 weeks to log, after a number of failures. This interval is 450 feet tall and is probably going to be no easier to get data over.
  • They should be at TD and hopefully logged on their 2 other high profile wells, Hurricane Deep and Blueberry Hill.
  • Valuations will probably be unchanged in terms of the bottom line here as production for 2010 are a function of known declines and should not be much of a shock to the Street.
  • As such, the name remains fairly cheap as E&P companies with big potential reserves go at 4.6x 2010 expected CFPS and high for the Shelf players (who are more commonly in 2 to 3.0x territory). Looking at future reserves, the total enterprise value remains well discounted to the potential here.

 


Speaking at IPAA today: (all times EST)

 


IOC Announces Oil At Antelope 2; Testing Ongoing

  • Weird press release as it only contains two sentences. Oil presence confirmed in the Antelope 2 well (this was the well that previously tested the highest known gas rate late last year), but testing ongoing to see if there are commercial quantities.
  • Commercial quantities of oil would potentially provide the next leg up for the stock.
  • The stock is bid up $3 plus on the mere mention of oil here.

NFX Debt Swap

  • NFX is tendering for $175 mm of its 7 5/8% Snr notes due 2011
  • Offering $650 mm of 7 5/8% Snr notes due 2020
  • Remaining balance to help fund the TXCO partial acquisition and this year's capex.
  • Interest to see them shying away from offering their undervalued shares to the market.

MVO thoughts tabled until the Thursday post, just wasn't done.

Odds & Ends

Analyst Watch:

  • Barclays raising E&P price targets:

    • NFX goes from $54 to $60 overweight
    • UPL $55 to $57 equal weight
    • PXD $49 to $55 equal weight
    • EOG  $121 to $127 - overweight
    • DVN $73 to $77 - eqaul weight
  • EXXI - coverage initiated at Johnson Rice at Overweight
  • PXD - Goldman cuts to Neutral

174 Responses to “Wednesday Morning”

  1. 1
    nifkin Says:

    Z- great stuff this AM- any other names benifit from IOC’s data?

  2. 2
    zman Says:

    Nifkin – I don’t think so, at least nothing comes to mind.

    PXD – downgraded to hold at Goldman, upgraded to Strong Buy with a $78 target at Raymond James.

  3. 3
    zman Says:

    MMR on the tape with additional pay at Davy …

  4. 4
    zman Says:

    MMR adds 65 feet of pay in the new interval – highlighted in the post, a lot sooner than they indicated it would be done on yesterday’s call, stock bidding over $16.

  5. 5
    BirdsofpreyRcool Says:

    MMR flying, pre-mrkt.

    You da man, Reef!!

  6. 6
    BirdsofpreyRcool Says:

    People finally recalling that “oh, yeah… little EXXI is in that well too, aren’t they…” $3.90 now.

  7. 7
    zman Says:

    Re 4:

    MMR 25.9% net revenue interest
    EXXI 15.8%
    PXP 27.7%

    You can probably add just under 50% to analysts’ recent thoughts here as these are blanket sands. So adding 65 more feet to a 20,000 acre structure is pretty massive. In the press release they noted they logged down to 28,530′ and since the logging tool is about 200 feet long, you have to drill deeper to be able to log down to the bottom of the interval you want to test. Note also they don’t have porosity data over this new interval yet.

    Stock bidding $16.50

  8. 8
    zman Says:

    Echo same to Reef!

    PXP probably finally going to get some play out of this well.

  9. 9
    zman Says:

    EXXI bidding $4.02.

  10. 10
    zman Says:

    Analyst Watch:

    BMO raising service targets:

    WFT from 25 to 29
    BHI from 50 to 54
    SII from 29 to 38
    CAM from 44 to 48
    HAL from $40 to $55 (last but not least, seeing a lot of interest in this name as we approach earnings)

  11. 11
    zman Says:

    Analyst Watch:

    NOG target upped from $13 to $16 at Howard Weil.

  12. 12
    zman Says:

    BMO raised the whole service sector to Outperform, so add SLB target going from $91 to $110.

  13. 13
    BirdsofpreyRcool Says:

    TechTrader is 50/50 for today… so he is (literally) taking the day off.

    HeadTrader thinks you buy the morning sell-off.

    I think EXXI is still a bargain here.

  14. 14
    BirdsofpreyRcool Says:

    Johnson Rice looking like geniuses this morning, with their initiation report on EXXI last night.

  15. 15
    zman Says:

    I saw a lot of 5 to 6 Tcfe estimates last week on the original 135 feet of pay announcement. So look for those numbers to go up accordingly. And MMR is not done drilling.

  16. 16
    zman Says:

    Coast Guard reporting Houston Ship Channel closed for second day due to fog. Probably hits the imports numbers in next week’s report.

  17. 17
    zman Says:

    PXP trading off at the open … astounding.

  18. 18
    bill Says:

    Pxp actually traded down today as is still lower than the the price the DAY before the first announcement

    Makes no sense

  19. 19
    zman Says:

    BOP – I’m with HT on that call. I would also put MMR / EXXI in the “strong get stronger category” for the day. PXP should join as well.

  20. 20
    BirdsofpreyRcool Says:

    I think even the Three Blind Mice could buy MMR/EXXI/PXP right here, right now and make money.

    JMHO, of course.

  21. 21
    zman Says:

    Bill – very tempted on that at this point. Could be limited by overall valuation but really, it makes no sense that they are involved in what could be over 1 Tcfe net to them vs their 1.752 Tcfe as of last year and the stock could care less.

  22. 22
    BirdsofpreyRcool Says:

    sunshine, honey… you feeling better about that EXXI buy now?? 🙂

  23. 23
    bill Says:

    21

    ..and discovery aside for a moment, oil has been relatively strong in q4 and they have the downside hedged with puts and the upside open.and ng was hedged at 10 in q4.
    and maybe calif lets them drill for oil, and…

    even flores and his wheeling and dealing and stock issuance cant screw this up

  24. 24
    zman Says:

    VTZ – Got any thoughts on the dollar? It’s trying to breakout today.

  25. 25
    Wyoming Says:

    MMR folks could get a short squeeze bonus too.

  26. 26
    zman Says:

    Wyoming – good point:

    http://shortsqueeze.com/?symbol=mmr&submit=Short+Quote%E2%84%A2

  27. 27
    zman Says:

    KOG speaks in 25 minutes at IPAA.

    http://www.vcall.com/customEvent/conferences/ipaa/20100119/agenda.html

  28. 28
    zman Says:

    Bad news for Solar:

    http://www.marketwatch.com/story/solar-stocks-drop-as-germany-proposes-subsidy-cut-2010-01-20

  29. 29
    skimo Says:

    FYI, An oil shortie beating his drum:

    http://seekingalpha.com/article/183374-crude-oil-the-path-to-70?source=yahoo

  30. 30
    BirdsofpreyRcool Says:

    Turns out, Winston Churchill was really describing PXP price action this morning(presciently, I might add) by calling it “a riddle wrapped in a mystery inside an enigma.”

  31. 31
    bill Says:

    energy getting creamed today with the exception of mmr and exxi

    fiscal responsibility means stronger dollar and lower commodity prices

  32. 32
    bill Says:

    30, lol

    well dow is down 157 maybe a serious correction here back to 10,000?

  33. 33
    zman Says:

    Crude down 160 with the Dow off 155.

    XNG down 1.5%; Dow down 1.49%. So I’d call the sell off in energy in tune with market. The higher betas off more as usual.

  34. 34
    BirdsofpreyRcool Says:

    Howard Weil out with an update on MMR — with today’s announcement of an additional 65′ of pay (bringing the total pay column to 200′), they are upping the PT on MMR from $15 to $18.

    BOLD MOVE, guys. But, in the right direction.

    Also, they point out that with the additional pay, there could be 8Ts of recoverable nat gas at the DJ structure.

    CRT has estimated that for every 1T of net recoverable at DJ, that tacks on $3 of NAV at EXXI. Sort of boggles the mind, doesn’t it….

  35. 35
    bill Says:

    exxi up only 6 % after a buy rec and a discovery but on a day like this you take it.

    I wonder if this falls to profit taking as the day goes on

  36. 36
    zman Says:

    IOC up 7% on the mere mention of oil in their hole. Going to give recent shorts there some trouble if they come back with a good test rate.

  37. 37
    VTZ Says:

    RE 24: It better make a new high here or it could be in trouble. I don’t have any time to look at anything today. Undoubtedly I’ll come back and see my portfolio in shambles.

    Fundamentally there is still no strength in the dollar.

  38. 38
    BirdsofpreyRcool Says:

    Stronger dollar is a global “report card” on the U.S. economy. Stronger dollar means healthier outlook for the economy means more energy demand. Not too worried that oil falls back to $55 here. Not with China running around, buying up all the reserves she can.

  39. 39
    zman Says:

    ROSE green.

    Re EXXI profit taking. You never know. The stock is up a lot as it is and people were thinking they would have more sand in this well. Note that they are not yet done drilling in the Wilcox and may go after the Cretaceous, so we may have seen the last sand member (this makes 5) or we could see more. At 200 feet of pay, on a 20,000 acre structure, that is known to be minimally faulted you are talking about potential gas reserves of probably 4 to 8 or more TCFE. Relative to the proved reserves of all the companies involved here, that is highly significant. EXXI has 12 more projects ID’d based on this concept play.

  40. 40
    BirdsofpreyRcool Says:

    NOT that I think the US$ goes beserk here… VTZ is right. Still too much stuff hanging over the economy to sound the “all clear” signal. But, I think any sell-off in oil due to stronger dollar is very short-sighted. JMHO, again.

  41. 41
    zman Says:

    KOG call starting now.

  42. 42
    baylor3217 Says:

    Thoughts on ANR on this 5% pullback?

  43. 43
    zman Says:

    Will get to ANR in a bit, listening KOG.

  44. 44
    VTZ Says:

    The number of states that are insolvent should offset all this talk about Greece and the other EU countries that are in trouble.

    The Wells earnings have been the only decent bank earnings yet.

    Toxic assets and writeoffs still need to be dealt with. Mark to market is a joke considering the marks of the banks that are failing weekly as compared to what they sell their assets for and the guarantees required by the FDIC.

    Too many insolvent institutions and too much deficit spending and too many MBS purchases and too low interest rates and no foreseeable increase in income tax receipts due to unemployment = no structural or fundamental support for the dollar.

  45. 45
    zman Says:

    KOG – EUR comfortable with 600 to 700,000 boe for the long laterals, 350 to 400,000 on the short laterals. Those are good sized numbers. Basically says ignore the IPs.

  46. 46
    zman Says:

    KOG – wells 10 & 11 complete in Feb, hopefully have data by 4Q09 call.

    Three Forks comments

    marginal well by another operator on their acreage.

    same operator (Peak I’d guess) has drilled to the west of the KOG acreage. Says they had problems completing but that the first stage is now producing significant oil.

    KOG will drill its first TFS well near that well, on the sw corner of their acreage.

  47. 47
    zman Says:

    KOG mentioned they will be in a STR well and a HK well in the Bakken. Huh? STR I get, but HK is news to me they are even in the play.

  48. 48
    zman Says:

    ANR – has news out, will need to read that. Would like to see it off towards $44 before I re-enter them or $70 on WLT. I’d note that Goldman and Simmons are pointing to ANR as their favorite met coal play (despite the fact that met coal is a small piece of revenues, it may be the swing on earnings due to pricing power).

    KOG – Lynn wrapping up.

  49. 49
    1520sbroad Says:

    #47 – HK?

  50. 50
    Hoss Says:

    Z

    Think he said Petro-Hunt

  51. 51
    zman Says:

    Market at LOD, with S&P down 16 at 1,134. Crude down a little more on a % basis but essentially marking the equity markets. Products not down as much, should set up decently low bar for tomorrow’s oil inventory report.

    Hoss – Ahhhh. Thanks. That makes total sense.

  52. 52
    zman Says:

    If the market recovers, I still put MMR and EXXI in the “strong get stronger camp” as they have successfully fought off multiple waves of PT this morning.

    NG off 5 cents. SWN in particular trading weakly. I don’t get that as it’s not overpriced compared to its shalier peers, and has been posting strong results in both the core Fayetteville and now in the E. Texas Haynesville. Hmmm.

    Barclays this morning cut their 2010 gas price forecast by 50 cents to $5.00. Driscoll has been a laggard for quite some time now, raising targets to current levels only grudgingly. But then he adds today that his top gas names are NFX and SWN.

  53. 53
    zman Says:

    Meanwhile, NG down 4 cents.

    VQ speaking in five minutes, interesting story.

  54. 54
    bloodystupidjohnson Says:

    Z: It is about time you pay attention to VQ — lol If, they can work out their Monterey holdings, this stock could do very well over the next few years.

  55. 55
    bloodystupidjohnson Says:

    The bottom line with VQ and even with the Cardium oil plays, is the use of frac techniques first started in the Barnett, then over to the Bakkan, and use it in these shale plays.

  56. 56
    zman Says:

    SP down 20 at 1,130. To me it has support here and at 1,120. I’ll see if I can get a comment from Nicky. Jerome, any broad market chart thoughts?

  57. 57
    BirdsofpreyRcool Says:

    checking in with HeadTrader… he can think of no reason for this mrkt sell-off. Except for the knee-jerk reaction to “strong $, weak materials.”

    Sure, stuff doesn’t go up every day. But it doesn’t go down 200 pts either. He points out that we are still in a range/channel… just down to the lower part of that channel, rather quickly.

    He would be buying this sell-off.

  58. 58
    zman Says:

    Thanks BOP, I’m still in his camp.

    VQ – cheap on cash flow, not so much on EBITDA, interesting, not much in the way of big catalysts, don’t know cost structure, guidance is flat but they admitted that they are bagging the Street on that. Kind of ho hum until they get some Monterey wells drilled this year. Feels like I should get a yield on something that doesn’t plan to really grow and they don’t pay one. Good bit of debt which is good if you have a rising oil price during the year. Will continue to watch.

  59. 59
    zman Says:

    AXAS up next, talk about a mess of a reinvented balance sheet. In all the hot plays for the reason the plays are hot. I give it a 10% chance of actually persuading me into ownership there this year.

  60. 60
    bloodystupidjohnson Says:

    VQ: potential catalysts — 1) if they can sell their interest in Hasting field or 2) if they can find a partner that will help them in their Monterey field.

  61. 61
    zman Says:

    Re 60 – that’s fair, still no interest at the present time, have not done enough work on it of late.

  62. 62
    zman Says:

    AXAS – hype, hype, hype. Comparing themselves to Bakken players on multiples gets you a $19 price. That kind of talk is just useless when those players have drilled a lot of wells in the play and you haven’t.

  63. 63
    bloodystupidjohnson Says:

    VQ: Unless you have a cystal ball, I don’t think it is an option play, at least not yet. It is a stock play. They are going to drill their Moneterey acreage slowing.

    Biggest concern with stock is selling of common (at these prices) to pay down debt. Since Marquez is the largest shareholder, he has commented that he does not want to do this. So if they can sell their interest in Hastings, this overhang could go away.

  64. 64
    zman Says:

    Listening to XEC. Will add to the next edition of the Orange Charts.

  65. 65
    jat Says:

    Driscoll is a less than perfect analyst. He was telling me not to buy gas companies when gas was $2.50 at the beginning of September b/c they were already reflecting much higher gas prices. I think KWK was around $11.00 when he said this.

  66. 66
    bill Says:

    i own a little vq. The ceo has been very patient not raising money at distressed level

    If he doesnt get the asset sale or partner i think he sells some stock here in the low teens

  67. 67
    zman Says:

    Yep, he’s been overly timid, marking targets to market as they’ve walked up and he’s been at mostly Hold ratings. I find his comments interesting though because historically he’s been a good estimator, good stock picker, just cold this last cycle.

  68. 68
    zman Says:

    MMR and EXXI up almost identical %s, in the mid 6+%s. Market still just off LOD. PXP just can’t get any respect.

  69. 69
    Jerome Blank Says:

    KOG…depending on how you draw the topside trendline on the daily triangle chart, KOG is currently retesting that trendline support now at about $2.50 as we speak…keep an eye out for an intraday reversal at theses levels, the 200 period SMA, which is also right here should help out… I’ll mention if I add anything

  70. 70
    Jerome Blank Says:

    Re: #69, I was speaking above of the 200 period on the 30 min chart

  71. 71
    zman Says:

    Thanks JB. FYI you guys can see his charts here:

    http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID3724280&cmd=show&disp=p

    … and if you look to the right on that page, you can click chart book which takes you to a drop down menu with all of his charts.

  72. 72
    Nicky Says:

    Afternoon all. Just dashing by and will be around more tomorrow. 1130 needs to hold on SPX. Next support is 1122 and then 1113. Seems to be dollar/commodity related….

  73. 73
    RMD Says:

    BSJ: I’ve just been focusing on VQ for a short time, but my impression is they are trying to do a BEXP-ish transformation: sell “other” assets and invest the proceeds to focus on their new core areas which they think are really good. The St. will catch on later…
    If correct this makes for a good long term investment. Do I have it right?

  74. 74
    cargocult Says:

    This could help things

    “In part because of its purchases of Treasury and toxic mortgage-backed bonds–a move intended to help prevent economic collapse–the Federal Reserve Bank had record profits last year. Earnings were up 47% from 2008, and $46 billion of its $52 billion in net income was paid to the U.S. Treasury.”

  75. 75
    BirdsofpreyRcool Says:

    cargo — remember a year or so ago… when we were talking about how those purchases were going to make money for the US Govt? Seemed so far-fetched back then.

    Making real money takes guts and conviction. If you get all wobbly about an investment, do more research on it. If you’re still wobbly, sell it.

    Knowledge + conviction + an understanding of time-lines = successful investing.

    Sorry, couldn’t resist the opportunity to spout off. Forgive me.

  76. 76
    RMD Says:

    RAJA upgrading EVEP and LGCY, downgrading LINE because LINE’s growth prospects and valuation warrant a Strong Buy. (This strikes me as an angels-on-the-head-of-a-pin differentiation.)

  77. 77
    BirdsofpreyRcool Says:

    EXXI — Just starting to peruse the Johnson Rice initiation piece… (and by “peruse” i mean to read with great care). It’s really quite good.

    Here’s the link to the report… let me know if it works.

    https://jrco.bluematrix.com/docs/pdf/EXXI_CR_2010-01-19.pdf?co=Jrco&id=lenny@jrco.com&source=mail&encrypt=773ecb04-391b-4e18-8f4b-ed5be67cefc4

  78. 78
    cargocult Says:

    BOP-all good advice.

    Anybody have insight on BBEP? It looks undervalued to me unless there is a good reason.

  79. 79
    1520sbroad Says:

    Off topic – any of the fixed income types here (BOP, Bondbuddha, et al) have any experience with Secondmarket? A site for trading illiquid, bankrupt, not public etc.? they run an Auction Rate preferred desk that claims to buy (at a discount) stuff that is currently and has been frozen. I wound up getting involved in a dead-letter-office type of project and have some ARPS positions i am trying to deal with.

  80. 80
    zman Says:

    Cargo – real can of worms there, lawsuits, and I don’t care for the structure nor with the number of MBA’s on the management team, and yeah I have one too. Anyway, lot of degrees and I avoided them before they killed their distribution. My two cents and worth little as I just won’t play. I think since cutting the div it has done nothing but go up but there are better ponies to ride, ask KWK, they’re entangled legally with them.

    Working up that MVO trust now while IPAA guys eat lunch.

  81. 81
    BirdsofpreyRcool Says:

    1520s — no experience with Secondmarket. Whenever we wanted (needed) to take out the (bond) trash, we always called Jefferies. They seemed to know where to offload stuff successfully.

    No offense to any Jefferies people intended. In all honesty, it was a very useful service Jefferies knew how to perform. (And I am sure they made a fat spread on the trade.)

  82. 82
    zman Says:

    BOP – Yeah, we did.

  83. 83
    BirdsofpreyRcool Says:

    z — lololololol…. 😉

  84. 84
    1520sbroad Says:

    #81 – thanks – i’ll dig thru my trash hauler list…

  85. 85
    cargocult Says:

    Z-Thanks for the heads up (80). That’s why you get the big bucks.

    BOP- thanks for the EXXI report.

  86. 86
    skimo Says:

    BOP 77 link works, thanks

  87. 87
    elijahwc Says:

    BOP that’s neat. ? How did you manage the direct link to a PDF file? I occasionaly run across rsch that I would link here if only I knew how.

  88. 88
    zman Says:

    Eli or anyone, do you have a list of preferably U.S. oily trusts? Aside from MVO.

  89. 89
    zman Says:

    GST speaking in 10 minutes at IPAA, time for the deep bossier update.

  90. 90
    BirdsofpreyRcool Says:

    elijah — it was sent to me as a link. Not sure they intended it to be totally open access… but, if they didn’t, they will yank the PDF, i guess.

    Was surprised to see it myself… but, sometimes it’s just “Good morning and Merry Christmas” all at once!

  91. 91
    Jerome Blank Says:

    EXXI intraday support points…$3.70, then the intraday gap closes at $3.60, there is also 30 min, 20 and 50 period SMA support at about $3.60..

  92. 92
    elijahwc Says:

    Z I don’t offhand but might be able to find one.

  93. 93
    Wyoming Says:

    PBT, BPT

  94. 94
    zman Says:

    Eli – don’t bother, thought it was you, thanks WYO.

  95. 95
    Jerome Blank Says:

    KOG…nice 30 min “doji” followed by a nice “hammer” right on the trendline…added some at $2.57

  96. 96
    tomdavis12 Says:

    77 – BOP thanks for the link

  97. 97
    Wyoming Says:

    Duh and PSE

  98. 98
    zman Says:

    PXP inching

    Thanks much WYO, saved me some digging through actual paper files, not my normal stuff.

  99. 99
    bondbuddha Says:

    re 79, 1520’s we are really specialized into the CMO market so I have no helpful hints for you, sorry.

  100. 100
    Wyoming Says:

    Not mine either, just happen to be bored and down a 6 pack of Becks.

  101. 101
    1520sbroad Says:

    #99 – thanks. Just spoke to the trader at secondmarket for ARPS on the phone – seemed legit.

  102. 102
    zman Says:

    EXXI call in 5 minutes

  103. 103
    Jerome Blank Says:

    KOG…”morning star” reversal on 30 min chart…good sign…

  104. 104
    zman Says:

    Shiller talking about Davy Jones now

  105. 105
    zman Says:

    Talking about how good the Miocene sands are, surprised by how clean, all with indications of porosity and perm they want, said the reason they went ahead logged was the bit burned up as the pdc bits don’t like that much sand.

    No water in the well yet, all gas. Talking a 1,400 foot column (just not all logged).

  106. 106
    BirdsofpreyRcool Says:

    EXXI/MMR… not often does one get the opportunity to hop onto something as potentially large as the Ultra-Deep Shelf plays. This is not going to work out over a month, or even a year. This will be a gift that keeps on giving (something I’ve said about the Bakken too) for many years. In the end, perhaps BigFoot (Exxon, BP, etc.) steps in and buys up little EXXI. But that will happen at a much higher price, methinks.

  107. 107
    zman Says:

    We’ve got oil and gas reports tomorrow (with API after the close tonight), also jobless claims, leading indicators and Philly Fed tomorrow, then back to no data on Friday. We’ve also got some tech earnings after the bell today. All in all, a throw away day today.

  108. 108
    reefguy Says:

    Bop-drilling update, not yet back to drilling. When they logged, they were still in pay sands. Plan 300′, if still in pay and can continue, they will go deeper.

  109. 109
    zman Says:

    Reef – rare to hear JS that excited.

  110. 110
    reefguy Says:

    Gonna add to EXXI here

  111. 111
    Jerome Blank Says:

    EXXI…added a bit at $3.74, just above first level support at $3.70 ,EXXI is having a hard time going much lower…

  112. 112
    RobBanks Says:

    ENP and LGCY are fairly oily trusts, in the 65%-75% oil range.

  113. 113
    zman Says:

    ENP – will look. I have LGCY as an MLP.

  114. 114
    RobBanks Says:

    Oh sorry, ENP is an MLP too.

  115. 115
    zman Says:

    Thanks ROB but I think both of those are limited partnerships, I’m looking for oily trusts, for use in tax free accounts.

  116. 116
    zman Says:

    No worries man, thanks, I think I’m good, just doing a little more digging.

  117. 117
    zman Says:

    IOC up 9.5% on that 2 sentence press release.

  118. 118
    BirdsofpreyRcool Says:

    Just got off the phone with a HF friend/colleague… asked him, “what’s that pinging i hear in the background?” It was the sound of his EXXI buy order being filled.

    Maybe EXXI is the target of an agressive short campaign at some point. Maybe the stock cr*ps out with the reverse split. I don’t know. Volatility comes with the territory, when you invest in these Special Situation Migits. But, I do believe that the risk/reward in EXXI makes it a compelling “must-have” for me this year. Just understand, that the ultra-deep wells are risky beasts… things take long to complete… stuff can happen. But, we have the technology and infrastructure to do this today. Unlike investing in PBR and their sub-salt oil.

  119. 119
    zman Says:

    Equity market and stocks coming off their lows, so far my “strong gets stronger” call not working. They’re up, just not as much. PXP however continues to inch up.

  120. 120
    skimo Says:

    Linn Energy Raised To Outperform From Strong Buy By Raymond James >LINE 11:39am Jan 20

  121. 121
    zman Says:

    Looks like Street is looking for 219 Bcf tomorrow. A little high by numbers but anything north of 200 Bcf really helps the storage overhang.

    On the oil front, mid sized builds in oil and gasoline expected, no change to slight build in distillates inventory.

  122. 122
    zman Says:

    Thanks Skimo

  123. 123
    zman Says:

    Actually, I show that as a cut in rating

  124. 124
    zman Says:

    … with an upgrade of EVEP to Strong Buy

  125. 125
    zman Says:

    Seeing some MLP notes about distributions needing to rise to combat rising yields in the market … with the thought that if they don’t prices will have to fall to keep the yield spread in place. Anyone with a bloom and some free time free to see if that relationship actually holds when you take into account flat to rising oil.

  126. 126
    skimo Says:

    Sorry copied it right from the BOA news page w/o really looking. 10 penalty points please

  127. 127
    zman Says:

    No, no, keep em coming. I missed that they were doing anything in that sector today.

  128. 128
    bill Says:

    Brown carried Barney Frank liberal district 112,000 to 110,000 amazing!

  129. 129
    zman Says:

    Bill – I seem to recall a word that has been tossed around a lot in the not too distant past. Referendum.

    Note that the refining segment is flat to green today….sigh of political relief there.

  130. 130
    italyinvestor Says:

    Z – Think IOC will expand on its two liner in any meaningful way at the conf today?

  131. 131
    zman Says:

    Italy – I would doubt they have anything like a flow test. I think they haven’t got they ran out of time to get it tested prior to speaking. I would bet on them adding some color though.

    Ram – I’m coming down on the side of liking MVO. It’s yield is probably closer to 12% given my outlook on oil and flat production. Pretty predictable. Not a huge load of upside on price as they hedged a lot of their oil.

  132. 132
    BirdsofpreyRcool Says:

    http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aewqoZXWbkeU

    on Bloomberg TOP news… Tex Moncrief’s share of Davy Jones.

  133. 133
    bill Says:

    Referendum totally agree

    Issue was not just health care. In the debate he scored points with battle on terrorism and Govt spending. He said we are spending tax dollars to catch these guys not to buy them defense attys. National press really hasnt talked about it much but some released gitmo “detainees” are back at their trade in Yemen. I think Dems are very weak on this issue.

    BHO to his credit said they wouldn’t slam health care through before Brown gets seated. (on the other hand, you can only pull games when no one is looking)

    He went on to say the electorate was dissatisfied over the last 8 years and what got Brown elected was what got him elected. Wrong but thats todays spin.

    it will be interesting to see if this election changes the direction.

    I thing cap and trade might be dead. Is that wishing for too much?

  134. 134
    bill Says:

    132 Moncrief still at it at 89 amazing

    Risked 7 m for a huge payday 10 % of Davy Jones. That might be the best investment made in 2009 by anyone

  135. 135
    zman Says:

    re 133. My thoughts are that cap and trade is way down on the list of things people who don’t work in the capitol building are concerned about. I do think it got a dealt a blow and that it will be tougher to push through now and next to impossible to pass after November. But that’s just my thinking and I of course could be wrong and that’s about as political as you’ll get me to get, lol.

  136. 136
    zman Says:

    IOC call started

  137. 137
    zman Says:

    Beerthirty, would someone post the API inventory numbers when they come out in 30 minutes.

  138. 138
    Jerome Blank Says:

    Added a bit more EXXI at $3.67…

  139. 139
    BirdsofpreyRcool Says:

    cool, Jerome. The more you have, the closer you will watch it. Thank you!

  140. 140
    bondbuddha Says:

    Ha, I got ya Jerome, 3.6697 !!

  141. 141
    RMD Says:

    BOP: re: 106, I just luv it when you go Dreamin’ Big on me.

  142. 142
    tomdavis12 Says:

    Z: MLP sector has had an extraordinary amount of capital raise over the last six weeks. IPO’s and secondaries. Almost 1 to 2 per day. Guess this is good. The hunt for safe yield goes on.

  143. 143
    zman Says:

    Wizard, let me know if you see this.

    Tom – gearing up to buy cheap assets to exploit in most cases, securing newly bought production with hedges as well.

  144. 144
    zman Says:

    Crude coming off lows on API data, don’t see the numbers yet.

  145. 145
    RMD Says:

    143 it strikes me that if gas prices quiet down and , say, trade between in what will look like a boring range in ’10 of $5-6.00, the foreward spread in the futures could suprise everyone and narrow (or backwardize if you want the long odds bet). This would upset the E&P stocks a bit.
    Just thinking out loud here; don’t know how much I actually believe it.

  146. 146
    zman Says:

    RMD – yeaaahhhh … don’t see that. I do so boring trading but typical contango should rule, especially if you look at declining production and going into the injection season from a lower point than all of thought possible a couple of months back due to cold weather.

  147. 147
    jat Says:

    KMP less than thrilling report

  148. 148
    zman Says:

    KMP = not my area.

    Have you seen the API yet?

  149. 149
    jat Says:

    crude draw -1.805
    gasoline build .667
    distillate draw -3.3k

    utilization down 3pct with refinery runs down 530 from 13891 to 13361

    Imports basically flat from 9729 to 9800.

    So, once again, we managed a crude draw despite a utilization drop and flat imports. Amazing how that works out, I missing anything?

    Hope the distillate is true. Would be nice.

  150. 150
    zman Says:

    Jat – I have a distant relative at API that I’m going to to bother about that someday. My sense is that their data on inventories and product flows (demand and imports) don’t match up from a timing perspective. Likely maybe imports are a week behind … just guessing but it sort of looks that way … most people have chosen to ignore them but I have noticed that of late they have been directionally in agreement with EIA. A 3% drop in refinery utilization now would be pretty much a new thing. That’s huge and it should really either be flat or up. I guess it could be a further reaction to weak demand (especially on distillates). By the way, about time to see distillate draws, if that number shows up tomorrow, it really pounds down the YoY surplus. Thanks for posting.

  151. 151
    zman Says:

    Ah, distillates demand sharply up. Not really surprising. Weather lifts and people take the chance to refill the home tanks, just not linear like like cold and natural gas demand.

  152. 152
    elijahwc Says:

    Z – here is your list for Royalty Trusts

    BPT, CRT, DOM, NGT, HGT, LRT, MARPS, MSB, MTR, MVO, NRT, PBT, SBR, SJT, TELOZ, TIRTZ, TRU, WTU

    http://en.wikipedia.org/wiki/Royalty_trust

  153. 153
    zman Says:

    Thanks for the full list Eli and sorry for the delay.

    Uninterruptable Power Supply my butt. If intern #2 can simply crawl under the desk, hit the big green button, crashing the desktop and forcing a check disk error, then it’s not very uninterruptable.

  154. 154
    zman Says:

    Looks like NFX senior deal was upsized from $650 to $700 mm. Coupon was dropped from 7 5/8% to 6.875% … what does that tell ya BOP? People wanted that paper.

  155. 155
    BirdsofpreyRcool Says:

    Funny how it works… the high yield sector was up about 60% in 2009. People see that and pour money into high yield funds. Thing is, that horse has long left the barn. You will see some more price appreciation (demonstrated by NFX deal being priced tighter while still being upsized), but gun-to-my-head-guess on total return for high yield bonds in 2010… 15%. Not that 15% is shabby… but… it ain’t no 60%. 60% is physically impossible for bonds, at this point.

    Nope, time to shift allocation to stocks… except for the stuff you want to have in income producing securities… like our lovely EXXI 10s.

  156. 156
    elijahwc Says:

    U.S. Royalty Trusts

    A list of 25 U.S. royalty trusts that could be of interest to income investors. U.S. Royalty trusts are established to receive the royalties or net profit interests in a specific group of assets and to pay out those funds to their unitholders. The assets and the net profit interests in those assets are specified when the trust is originally established. Most of the U.S. royalty trusts provide dividend payments which are based on the oil and gas production of specified properties. The trust assets are limited to the net profits interests in their specific assets which have a limited economic life. Trust unitholders are taxed directly on their proportional share of the trust income. U.S. Royalty trusts distribute substantially all trust income to unit holders. Royalty trusts pay monthly or quarterly income that varies over time as the production of the underlying assets varies and generally gradually declines. Payments to unitholders will also vary with the market price of oil and natural gas. U.S. Royalty trusts are considered as grantor trusts for income tax purposes and the unit holders are taxed directly for their share of the trust income and entitled to their share of trust deductions. In the case of oil and gas royalty trusts, unitholders are entitled to tax depletion deductions and tax credits. The trusts provide unitholders with the quarterly and annual reports required so that the unitholder can properly report their share of the income and deductions of the trust for income tax purposes. The distributions of U.S. royalty trusts are not eligible for the 15% tax rate as the trust does not pay income taxes on their profits.

    Special Features of this List: – Clicking on the Symbol of any listed security will produce our security description and information page for that security. Clicking on the IPO Prospectus @ SEC EDGAR will produce the original IPO prospectus for the security as filed with the SEC EDGAR system. Clicking on the Stock Exchange (NYSE, etc.) will produce the latest price quote for the security from that exchange. Clicking on the Chart below the Stock Exchange will produce a historical price chart for the security for varying periods depending on the chart source.

    Select # of records per page : ALL
    Page: 1 of 1

    Symbol
    CUSIP Security Stock
    Exchange

    BPT
    055630107 BP Prudhoe Bay Royalty Trust NYSE
    Chart
    COCBF
    190432203 Coastal Caribbean Oils & Minerals Ltd OTCBB
    Chart
    CRT
    22757R109 Cross Timbers Royalty Trust NYSE
    Chart
    DOM
    25746Q108 Dominion Resources Black Warrior Trust
    IPO: 5/31/94 NYSE
    Chart
    NGT
    276217106 Eastern American Natural Gas Trust Depositary Units
    IPO: 3/15/93 NYSE
    Chart
    GNI
    391064102 Great Northern Iron Ore Properties NYSE
    Chart
    HGT
    444717102 Hugoton Royalty Trust
    IPO: 4/09/99 IPO Prospectus @ SEC EDGAR NYSE
    Chart
    LRTR
    502003106 LL&E Royalty Trust
    IPO: 6/28/83 OTOTC
    Chart
    MARPS
    568423107 Marine Petroleum Trust NSC
    Chart
    MOSH
    590650107 Mesa Offshore Trust OTCBB
    Chart
    MTR
    590660106 Mesa Royalty Trust
    IPO: 11/01/79 NYSE
    Chart
    MSB
    590672101 Mesabi Trust NYSE
    Chart
    MMTRS
    601158108 Mills Music Trust OTCBB
    Chart
    MVO
    553859109 MV Oil Trust
    IPO: 1/19/07 IPO Prospectus @ SEC EDGAR NYSE
    Chart
    NRT
    659310106 North European Oil Royalty Trust NYSE
    Chart
    PHX
    698477106 Panhandle Oil and Gas, Inc. NYSE
    Chart
    PBT
    714236106 Permian Basin Royalty Trust NYSE
    Chart
    SBR
    785688102 Sabine Royalty Trust NYSE
    Chart
    SJT
    798241105 San Juan Basin Royalty Trust NYSE
    Chart
    TELOZ
    872382106 TEL Offshore Trust NSC
    Chart
    TIRTZ
    886410109 Tidelands Royalty Trust B
    IPO: 6/01/54 OTCBB
    Chart
    TRU
    891013104 Torch Energy Royalty Trust NYSE
    Chart
    TISDZ
    894626209 Treasure Island Royalty Trust OTOTC
    Chart
    WHX
    966389108 Whiting USA Trust I
    IPO: 4/25/08 IPO Prospectus @ SEC EDGAR NYSE
    Chart
    WTU
    969450105 Williams Coal Seam Gas Royalty Trust NYSE
    Chart
    Symbol
    CUSIP Security Stock
    Exchange

    Disclaimer – This list is intended to be complete and correct to the best our ability but the information is not guaranteed. The list is provided solely for the convenience of the QuantumOnline user and should be considered by the user as only a general source of information, not as a final authority on any particular information provided on the list. We definitely recommend checking the information with additional sources to confirm its correctness before actually purchasing any security based on the above information.

  157. 157
    elijahwc Says:

    opps that didn’t format very well. Several additional names there.

  158. 158
    zman Says:

    Thanks again Eli, just looking at the oily ones today, used to own SJT for gas exposure.

    and TISDZ for exposure to what EXXI and MMR are now drilling.

  159. 159
    elijahwc Says:

    WHX Whiting

  160. 160
    zman Says:

    Saw that and had forgotten about it. I think that’s a dropdown vehicle for them.

  161. 161
    VTZ Says:

    http://www.bloomberg.com/apps/news?pid=20601087&sid=a_6UG9x9ukAA&pos=5

    What a joke…

  162. 162
    VTZ Says:

    http://www.bloomberg.com/apps/news?pid=20601087&sid=ah5uJvRvp8gM&pos=1

    One day the western media is going to have to stop posting bs articles like this.

  163. 163
    bill Says:

    161

    why is that a joke

    what % should it be

  164. 164
    VTZ Says:

    How would you feel if 63% of your gas price went in my pocket for the services I provide.

  165. 165
    VTZ Says:

    They must have done a top notch job recently, hey?

  166. 166
    VTZ Says:

    Not responsible for anything… just business as usual… no biggie.

  167. 167
    VTZ Says:

    Shit… why didn’t they get 105% of revenue… they’ve been bang up as far as I can remember.

  168. 168
    skimo Says:

    http://finance.yahoo.com/news/Anadarko-Announces-Successful-bw-3824287680.html?x=0&.v=1

  169. 169
    zman Says:

    Yeah, they just keep hitting off the W. African coast for APC.

  170. 170
    zman Says:

    TRGL looks to be bought

    http://www.reuters.com/article/idAFLDE60K0FW20100121?rpc=44

  171. 171
    Wyoming Says:

    No, really, we would understand if you were too busy …. don’t feel obligated ..

    http://www.rollcall.com/news/42457-1.html

  172. 172
    bill Says:

    lol 171

  173. 173
    zman Says:

    Re 171. Olympics, Copenhagen, Coakley …

  174. 174
    zman Says:

    Thursday post is up

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