Wednesday Morning – Oil Preview + ECA

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Market Sentiment Watch: Another day, another confusing turn. One thing that is certain is that unlike some quarters in the past, the market is paying attention and not just selling results. This makes sense since the energy sector has been losing ground since the end of April while commodities have been essentially flat on the Strip. So there is little in the way of elevated expectations built into shares prices.

BP Spill Watch:

  • Another 24 hour extension for the pressure test was granted yesterday afternoon.
  • 5 inconsequential dribbles have been spotted coming from the stack.
  • BP sold a sizable asset package to APA for $7 B
    • Assets are in Canada, the Permian Basin, and Egypt.
    • BP gets $5 B in cash deposited on July 30.
  • That other seep, the one that's 1.8 miles away from the well is now thought to be another well, an abandoned one, that is leaking. Which leaves inquiring minds wanting more information:

    • Macondo is located on Mississippi Canyon Block 252
    • MC 252 has been leased three times:

      • 1993: Partners in MMS Lease #08487 were Exxon, BP, and one other company that must have been acquired since then because I can't track down it's number. No matter, no discovery was made at the time.
      • 2003 Discovery of Rigel: Partners in MMS Lease #18207 and 21164 were operator Dominion (D), Mariner, ENI and NFX. This was a natural gas discovery and production began Spring 2007. I'm confirming that this is not the leaker and even if it were, it would be a gas leak, not exactly devastating, but I wanted to rule it out. See comment 33 below.
      • 2010 Discovery at Macondo: Partners are as you know BP, APC, and Mitsui.
      • The seep could be on a neighboring block and I'm checking into that but with the current hostile environment towards "big oil" I could see another witch hunt for whoever is responsible for the other leak and congressional calls for an examination of the 50,000 or so Gulf wells in general.

In Today’s Post:

  1. Holdings Watch
  2. Commodity Watch
  3. Oil Inventory Preview
  4. Stuff We Care About Today – ECA earnings
  5. Odds & Ends

Holdings Watch: ZCAT (Zman Catalyst portfolio):

  • $7,500
  • 74% Cash
  • Positions for the quick view are updated on the ZCAT, ZIM, ZLT page.
  • Yesterday’s Trades: None

ZIM (Zman Inefficient Markets portfolio)

  • $2,700
  • 17% Cash
  • Positions are updated on the ZCAT, ZIM, ZLT page.
  • Yesterday’s Trades:
    • WFT – Added (20) WFT $17 August Calls for $0.22 with the stock at about $15.60. I had a bid put in under the market during their conference call and just filled. The call went well, for once, after they beat and numbers for 2010 should be going up. Mexico flattening going forward is better than the Street could have been thinking going forward and NAM and East Hemishpere have pretty strong momentum. On the option choice, delta on $17s and $18s resulted in the same gain on a $1 move so I went for the lower strike but less calls. See today’s post for more comments.

ZIM (Zman Inefficient Markets portfolio)

Commodity Watch:

Crude oil moved up $0.68 to close at $77.58 yesterday. September becomes the front month contract today. After the close, the API released tepid report with one highlight being a drop in gasoline inventories, something I was expecting but which may or may not be in the EIA report today as week to week that's hard to predict. But I do expect a bounce in demand from last week's anomalously low levels and that would be helpful in keep crude in the upper end of its recent band, all other things being equal (see below). This morning crude is trading up 75 cents.

Natural gas rallied  $0.08  to close the day at $4.63 yesterday on storm concerns. This morning gas is trading up 3 pennies.

  • Tropics Watch: System approaching Cuba and tracking towards the Gulf increasingly likely to become Bonnie. Forecasters now put odds at 60%for development to a Tropical Depression or Storm within the next 48 hours. Note, some of the tracks are driving pretty close to Macondo which could mean the relief well rigs would need to pull off and make a run for it. Very early to make that call but giving a heads up that it could happen.
  • Early Read On Natural Gas Storage: Street is at 51 BCF for tomorrow’s report. I'm going to be somewhat lower.
    • Last Week:  78 Bcf Injection
    • Last Year:  70 Bcf Injection
    • 5 Year Average: 52 Bcf Injection
    • 10 year Hi: 87 Bcf Injection
    • 10 year Low:  (7)  Bcf Injection

Oil Inventory Preview

API Watch:

  • Crude: Down 241,000 barrels
  • Gasoline: Down 412,000 barrels - Not at all surprised to see a negative number here and expect to see that in the EIA as well with a bounce back in gasoline demand.
  • Distillates:  Up 979,000 barrels

Stuff We Care About Today

Earnings Watch

ECA Reports Strong Quarter; Boosts Guidance

The 2Q Numbers

  • Production of 3.3 Bcfepd (3.2 Bcfgpd)
    • includes the impact of 0.150 Bcfepd in divestitures and a flat rig count from year ago levels.
    • US division produced 1.9 Bcfepd, up 17% YoY -
      • Piceance now 0.470 Bcfepd, up 29% YoY
      • Haynesville now 0.269 Bcfepd, up 398% YoY, up 39% Seq. Still calling for average 2010 production of 325 MMcfepd but the exit rate comment has transitioned from 400 to 500 MMcfgpd last quarter to simply "about 500 MM/d" now.
      • The Jonah and Ft Worth divisions slipped slightly.
    • Canada produced 1.4 Bcfepd, down 3% due to the asset sales
  • Operating Costs: Falling.
  • CFPS of $1.65 vs $1.44  expected


  • 2010:
    • Volume guidance boosted by 65 MM/d to 3.365 Bcfepd, reflecting a move from 10% YoY growth to 12% YoY growth.
    • Capex grows by a whopping $500 mm to total $5.0 billion now for this year, something they will need to go over in good detail on the call.
    • LOE seen falling $0.10 per Mcfe to $0.80 Mcfe

Last quarter I wrote that their numbers were conservative in this post and the comments that followed it.

Operational Highlights:

  • Brent Miller well: 32 MM/d IP in the E. Texas Haynesville. They have 45,000 acres in the area.
  • Collingwood Shale, Michigan.

    • 250,000 acres
    • First well flowed 2.5 MMcfepd for a 30 day average, respectable for plays in this part of the country.
    • No word on well cost but I'm sure the first one burdened with extra science. Look for more details on that and EUR potential (guessing they'll say too early) on the call.

Balance Sheet:

  • Debt to Cap: 31.6% (27% netting out cash). Still comfortably below their upper limit, and will still be as they ramp spending.


  • 2010: 55% of expected volumes hedged at $6.05
  • 2011: 1.2 Bcfgpd hedged (so about 36% of current production) at $6.33
  • 2012: 1.0 Bcfgpd hedged at $6.46
  • These totals are in line for 2010 and bolstered for the two out years.

Nutshell: Strong quarter, again. Guidance bump should be a crowd pleaser as the company continues their tradition of "underpromise and over-deliver" however the sharp boost in spending plans will likely mute the response through the company's late day conference call. On the call look for more detail on E. Texas and maybe some questions about the Eagle Ford well they have completed with NFX (we'll know about that one either by the end of today or when NFX reports on Friday). Valuation remains on the low side based on P/CF of 5.4x in 2010 and 5.0x in 2011, noting that both 2010 and 2011 cash flow estimates are going to be lifted after this call.

Conference Call: Today, 1 pm EST.

Other Stuff

Earnings after the bell: CLB

Odds & Ends

Analyst Watch:

  • WFT - Deutsche reiterates Buy, target stays $27
  • WFT - Goldman maintains Neutral, bumps target a buck to $17
  • NE - FBR maintains Outperform
  • BTU - FBR reiterates Outperform, cuts target $2 to $55
  • BTU - Goldman maintains Buy, ups target $1 to $55

147 Responses to “Wednesday Morning – Oil Preview + ECA”

  1. 1
    elduque Says:

    Ted spread at 35

    Baltic up a little.

  2. 2
    zman Says:

    Editor turned off so you Iphone types can comment.

    Oil up 90 cents at 78.50.  Not a great feel for the numbers today, although I do expect better than Street change in inventory of gasoline. Note that in the posts I've gone to updating the Crack Spread charts every other to every third week as there is just little interest on my part in the indie refiners at the moment. I still think they beat for 2Q and saw that Citi bumped their numbers yesterday for the group but look at a chart of VLO and you can smell the apathy.

  3. 3
    zman Says:

    Thanks ElD. Actually forcing myself to check in on the drybulker action a little more often now.

  4. 4
    zman Says:

    NE and APC going at it legally over whether or not moratorium is a force majeure event. I have to say that if this were off W. Africa and not in the Gulf of Mexico I think everyone would agree that it is.

  5. 5
    zman Says:

    MCF on the tape with an operational update. Stock has been whacked due to fear over what new liabilities and regulatory hurdles the Shelf crowd will suffer following the BP spill.

    Onshore well: S. Texas, plans to complete, no further data but not meaningful yet.

    2 past discoveries now on production, combined add of 21 MMcfepd, big but anticipated boost to production, now at 107 MMcfepd (102 offshore, 5 onshore). They have either 8 or 9 producing wells offshore (I forget which) and so each one is important. Part of the drop was a dry hole, part of the drop was related to a dredge-cut of one of their production pipes. And part is worry over the future of drilling in an unlimited liability environment.

    2011 budget is $50 mm for 1 well per month onshore and then 2 wells offshore. This is mostly an offshore company but the downshift offshore is again due to the liability issue.

  6. 6
    RMD Says:

    #5 MCF: I wonder if Ken is going to keep morphing toward onshore? Will have to check last update for buybacks but seems like he’s been active. Also mentions a one-time dividend as possible; could this be because he can’t spend the $ offshore?

  7. 7
    bill Says:

    102 per day is 9 bcf per qtr and with their low operating cost , the whole thing falls to the bottom line.

    9 bcf * 4.5 = 40 m per qtr cash flow over 10 dollars of cash flow per share so

    4.5 to 1 ebitda

  8. 8
    crysball Says:

    Bloomberg is reporting BP Macondo Well Manager knew of hydraulic leak in BOP 90 days prior to well blowout and did not notify MMS (as required) and did not attempt to repair the leak.

    CAM may benefit additionally from this revelation (which had been alluded to earlier).

  9. 9
    zman Says:

    RMD – he did buy more shares back, $30 mm in cash on books strikes me as lowish to my memory, will check.

  10. 10
    zman Says:

    Bill – agreed re bottom line, he’s offshore but has the costs of a hermit in a field.

  11. 11
    BirdsofpreyRcool Says:

    XASC#1 weighs in with a few comments this morning on credit and availability —


  12. 12
    zman Says:

    WLT gapping higher off BTU yesterday, not chasing, waiting for a market pullback.

    BP – probably a smaller bounce (up 3.6%) than they deserve. Relief well on the tape as a weekend intersect event. That doesn’t mean it actually kills the well this weekend but think 1 to 2 weeks longer with the release dates by the govt/BP erring on the conservative side. My 1 to 2 weeks also assumes they hit it first try and there is no guarantee of that. Wells of BP said yesterday that if they get go ahead for the new static kill job they will do it.

  13. 13
    bill Says:

    >Also mentions a one-time dividend as possible;

    re mcf..I haven’t seen that but a price in the 40’s is ridiculous

  14. 14
    zman Says:

    Market feeling a little indigestion of yesterday’s late gains. Good explanation by cross asset last night about that rally. Thanks for posting BOP.

  15. 15
    zman Says:

    SSN – again big early volume, now 730K, up 2.4% and fighting off an attempt to sell off now. Stock looks tired. D-Day is July 26th. Have to say there should be less upside and more downside in the name right now. If the deal gets done at the high end of the range I could see another 20 cents although it is a midget and moves can be exaggerated for short periods as the pendulum swings too far. Conversely, if now they announce no deal is done, and I don’t think this happens, but if they do, then look for the stock to open down 30 to 40 cents eventually slipping to the $0.50 to $0.70 range.

  16. 16
    Nicky Says:

    Morning all.

    Support at 1069 – 75. Think it likely we drift back there.

  17. 17
    zman Says:

    SSN – has anyone seen their partial refund arrive yet? Thanks.

  18. 18
    zman Says:

    Thanks much Nicky, when you get a chance can you run through your next couple of months way points on the chart?

    Oil numbers in 30 minutes.

  19. 19
    zman Says:

    Analyst Watch:

    WLL picked up at Pritchard with a Buy.

    Will looking at adding to the ZCAT soon for earnings and op comments July 28th.

  20. 20
    zman Says:

    ECA bleeding off pre call, down 2.25% now. The big bump in capex is easily absorbed by them but people like more of an explanation for that kind of thing than was in the release, or a bigger bump in volume guidance which was not there either. Chances are they will do a good job of elucidating their thoughts on this on the call.

  21. 21
    BirdsofpreyRcool Says:

    HeadTrader saying he thinks the Machines were programmed to sell the opening rally… but are done now. Thinks we drift higher from here too.

  22. 22
    crysball Says:

    Have you considerd adding a section on Microcaps, and using some differernt metrics [i.e…. net lease acres in various plays and valuing them] since these plays appear catalyst driven and lack both production and measured reserves in their stage of development?

  23. 23
    BirdsofpreyRcool Says:

    IM from XACS#1

    The intra-day relationship between credit and equity markets continue to indicate that the equity markets are dictating the intra-day trading relationships between the two markets. However, intraday credit market volatility continues to decline…and this indicates that equity volatility is biased to continue to decline. This is clearly a positive for the broader equity indices. One of the reasons we became bullish at the end of June was because of the improvement in bank CDS spreads, the normalizing of GS’ CDX credit curve, improvements in consumer credit losses, and improving CDX IG spreads. COMPARING THE PERFORMANCE OF THE CREDIT MARKETS TO THE EQUITY MARKETS (SPX) would indicate that SPX has the potential to rise to the 1150-1175 range QUICKLY. The steepening of CDX IG credit curve further indicates that this 1150-1175 range is even more likely to be reached relatively soon

  24. 24
    Jerome Blank Says:

    RE: #17, no refund yet….

  25. 25
    cargocult Says:

    Sounds like I’m hearing the most of the fun has already been baked into SSN.

    And where are you getting your info on MCF? Google shows no debt but also low margins.

  26. 26
    zman Says:

    BOP – always appreciate the additional color, thanks.

    Crys – not outside of the Acreage plays tables I keep up with. I could do that in the future but since each one is kind of a “from the ground up, back of the envelope NAV” like NAV, I’m somewhat torn on the issue of trying to compare them across one table, if that is what you mean. I also do not, do not, do not, want to be overly involved in the single digit midget crowd. These things are dangerous which coming from a guy who spends a lot of time on options is saying something. Right now I follow too many of them and some of those not well enough to justify continued ownership (END). I much prefer real companies. Like holding a WLL or an HK (although not lately I have to admit). These tiny caps are like throwing M-80s. Fun until you botch one and then you are left looking for your fingers.

  27. 27
    zman Says:

    Thanks JB

    Cargo – did I say debt? They have $30 mm in cash on the balance sheet and an untapped credit line for $50mm.

  28. 28
    zman Says:

    I turn my back and WLL just flies. Wasn’t going to add it pre-inventories anyway but if they are bullish then ayecarumba.

  29. 29
    choices Says:

    note-Global Hunter starts SWN at Buy

    VNR increased div $0.025 to $0.55/qtr~=9%

  30. 30
    zman Says:

    Inventories in 15 min.

    If they stink I will take profits in HAL. I don’t have a good feel for the oil inventory numbers this week although I do think there will be a recovery in gasoline demand.

  31. 31
    zman Says:

    Thanks Choices, those guys are all over our names these days.

  32. 32
    zman Says:

    Cargo – re SSN – yeah, pretty much, it’s starting to price the deal in more than 50% of the way to my low end target. I have to take some profits before the deadline.

  33. 33
    zman Says:

    NFX confirmed for me no leak at Rigel. It’s all gas but I had to check before some stupid “journalist” tried to make something out of that.

  34. 34
    zman Says:

    EIA Oil Inventory Review:

    Crude: up 0.4 mm barrels the table in the post has this estimate as +1.2 mm barrels, should have been -1.2 mm barrels
    Gasoline: up 1.1 mm barrels
    Distillates:up 3.9 mm barrels

    more in a second …

    Crude at 77.89 pre report

  35. 35
    zman Says:

    Not a great report…

    Gasoline demand did rebound, went from a weird dip of 9.08 mm bpd last report to this week’s 9.435 which gets demand back to the high of the year.

    Distillate demand fell off however and that’s what you are seeing in the big dist build.

  36. 36
    choices Says:

    VTZ-you are correct-the relationship of royalty based RGLD has broken down since RGLD’s offering in Jun-will continue to watch, however.



  37. 37
    zman Says:

    More EIA

    Crude at Cushing jumped 1 mm barrels to 37.1 mm barrels, back near the all time high.

    Imports drove the big crude number by the way, surging back to 10 mm bopd.

  38. 38
    zman Says:

    Crude at 77.25 and still falling.

    Imports make the crude number a low quality miss. Refining throughput actually ticked up, the build in gasoline is probably largely to be backed out next week.

  39. 39
    jiveyjr Says:

    re: 17; no but I asked my broker where it was…no word yet

  40. 40
    zman Says:

    Group really not reacting much to the dip in oil, now at 77. Most gave up gains but are not running scare at the moment.

  41. 41
    zman Says:

    CNBC talking about docudrama they will run on the Deepwater Horizon tonight.

  42. 42
    VTZ Says:

    RE 36 – For the record, the royalty model of companies like RGLD, SLW and FNV is my favourite model if they do it right.

    I was just cautioning against using RGLD as a proxy because right now people are voting with their shares about how they felt about the last offering.

    I want to stress again that gold bounced off important (!!!) support and I think it could be ready to swing the momo traders to the other side soon or at least force them to take some of the short positions off.

  43. 43
    Geno Says:

    BP- I hope they don’t try the intercept until they have a timing on the potential weather. Hopefully they are trying to get it done before the potential hurricane.

  44. 44
    jy Says:

    Additional details regarding the info in today’s post about nearby production to BP’s Macondo. On the block to the south of BP (MC 296) Dominion drilled a well to 16200′ MD (14162′ TVD) in 11/2003. It is located approx. 3 miles to the SW of BP’s Macondo well. This well found hydrocarbons in at least 5 intervals from 9683′ – 13220′ TVD. The well was completed in a 100′ interval at 11,009’TVD (upper Miocene age Rob E section). The well went on production 3/2006 and has produced 73 BCF and 55,906 BO thru 4/2010. Last reported test rate was 19.3 Mmcf & 6 BOPD on a 100/64″ choke flowing at 1539 psi on 12-6-2009. It is a subsea completion.

    The only other well in the area was drilled by Texaco in 11/1999 on MC Blk 252 to a TD of 13600′ MD (12832′ TVD). This well encountered several thin (<40' thick)apparent hydrocarbon bearing zones also of upper Miocene age between 8900' and 12600' TVD.

    Next nearest drilling is about 12 mi NE by Exxon at MC 211 "Mica Prospect". 2 wells there have produced 4,009,000 BO and 70 BCF gas from 6/2001-4/2010

  45. 45
    zman Says:

    Geno – Gotta be on their mind. Also, the second riser isn’t constructed yet so I’d bet we don’t see any siphoning now, unless the cap develops a significant leak.

  46. 46
    bill Says:

    25, you need to look at the quarterly 10’q.

    yes, margin have been low but its not where theyv’e been, its we’re they are going

    re mcf

    The numbers are lumpy due to their “Accounting” for drilling expenses which are written off for dry holes

    Also, last qtr, they lost half their production when a pipeline was sheared in a mishap. In prior years, alot their ng was shut in due to damage caused by hurricane ike.

    As you know, NG is down from 13 to 4 so that would compress margins as well.

    If you dont like NG dont buy MCF.

    The story is production is growing substantially from a recent discovery and the shut in production coming back on line

    They only have 7 employees, and with ngl liquids in the mix, if ng avg 5 bucks , they sell gross at 6 and have 1 dollar in expenses , netting 5 net

    Its a cash cow with low ng prices. They should be able to generate 3 per share cash (before taxes) per qtr

    The upside is higher ng prices.

    the drilling ban actually helps them (in the short run) as they have all this production and smaller ep expenses. the budget for this year was 191 m , next year its 50m or 141 m lower 141 on 16 m shares is 9 per share.

    He hints at a one time divy.. Divys are taxed at 15 %. If cap gains tax is higher than 15 % which way do you think hed like to be paid. The ceo hates paying taxes

  47. 47
    zman Says:

    JY – that’s part of Rigel (MC 252/296)

    Did Texaco produce that well? Couldn’t find a record of production for it.

  48. 48
    bill Says:

    CNBC had a weather guy on who made the comment traders are more focused on the tropiss as opposed to the current record heat.

    The wave of puerto Rico doesnt look as menacing as it did yesterday , ng off today.

    The traders are looking at wrong thing, imho.

    Its hot as hell on the east coast and this weather has to eat into the injections

    BTW, Robry has 55 this week

  49. 49
    Geno Says:

    They have got to be doing everything possible not to hook the well up with full stream production. I know they don’t want everyone to know the exact flow rate.

  50. 50
    zman Says:

    Bill – I agree completely re weather, glad to know the CNBC is using his membership as we’ve been saying that for awhile. I’m sub 50 now.

    Geno – you cynic you, lol.

  51. 51
    zman Says:

    ECA really in the penalty box now, waiting on their call at 1 pm EST.

  52. 52
    zman Says:

    Did not pull the trigger on HAL yet as per comments just before inventories. Oil moving with market now, weakening.

  53. 53
    cargocult Says:

    Bill, Thank you for the information on MCF.

    btw, I hear you on the ng, but if I didn’t like ng I wouldn’t be here.

  54. 54
    zman Says:

    Market just drifting lower here. As I often say, ignore Nicky at your own peril.

  55. 55
    bill Says:

    sd down again .


    NG up 5 % , sd down 5 % last 5 days

    thats using yesterdays numbers.

    At some point, sd has to go up.. right??

  56. 56
    tomdavis12 Says:

    Z: Figures I have seen has the average weekly NG injection during the month of August from ’05 to ’09 has been 90.8.

  57. 57
    RMD Says:

    MCF: the math in shares bought since the 3/10 10-Q is bought ~360m shs for $17.8mm ($49.44/sh). $28mm left on authorization.
    bill, your thinking about the tax increase incenting Ken to “get it now” makes lots of sense.

  58. 58
    Jerome Blank Says:

    bill, SD is trading right at the lower consolidation triangle trendline, actually not a bad spot for a long try with stops for short term trades under $6…

  59. 59
    elduque Says:

    I am long FCX – looks excellent. They are seeing good demand for copper and of course they are making out like bandits on gold by products. Creating strong cash flow. Have paid down debt significantly.

  60. 60
    zman Says:


    BP – Added (10) BP August $45 calls for $0.29 with the stock at $36.28. Thinking that as we approach the weekend and the relief well inches closer to its target, we will see a speculative move in the name. Going for high leverage on it and don't need the stock to get close to the strike for the trade to work. May add more in next couple of days.


  61. 61
    elduque Says:

    I am also thinking that the gold stocks, AEM, GG, NEM and AUY are cheap. They have been beaten down, but are going to be throwing off great earnings for years to come if Gold stays around these levels.

  62. 62
    bill Says:

    on mcf
    todays press release
    We have continued to purchase shares of the Company’s common stock under our $100 million share repurchase program. Since implementation of this program, we have now purchased approximately 1.7 million shares for $76.0 million, for an average price of $44.71 per share
    last qtr 10 Q
    1,339,808 shares of our common stock at an average cost per share of $43.40, for a total expenditure of approximately $58.2 million, as 4/30/10

    so they spent another 17.8 m buying aprrox 400 k shares since 5/1

  63. 63
    zman Says:

    SSN at $1.30. I'm milking it but that chart looks pretty much like a telephone pole.

  64. 64
    bill Says:

    just saw rmd 57
    I had one more thought …
    Im not sure how this works..Their reserves are lower, so the dda rate will be higher.
    Question> do they take a hit for the 1st 9 mos…i think the answer is yes.
    They say> "a reduction in the Company’s proved reserve estimate at March 31, 2010 of 1% would not have a material effect on depreciation, depletion and amortization expense. Holding all other factors constant, a reduction in the Company’s proved reserve estimate at March 31, 2010 of 5%, 10% and 15% would affect depreciation, depletion and amortization expense by approximately $1.3 million, $2.6 million and $4.2 million, respectively."

    The charge mention above is what and ITD change or a qrtly chang? The reserve were written down about 15 % so 4.2 m will hit in q4 on top of the normal dda
    I'm painfully aware the ARD wrote down reserves and had a higher dda charge in q4 for the year and that caused the stock to crater from 44 to 32
    Peak, could/ should announce the one time divy at the time of the q 4 earnings release to ease the pain

  65. 65
    bill Says:

    On Mcf
    No one follows the name..The ceo has monthly updates (good) but refuses to have a qrtly conf call
    He had a 12 month selling plan in place where he sells 200 k shares over a 1 year period
    he just exercised this years allotment of 250 k shares with no sell program in place
    (He isnt selling in the 40's) and neither am I

  66. 66
    elduque Says:

    Bill- thanks for the prompt on NM. Where do you think about selling some?

  67. 67
    bill Says:

    nm is still moving, people like the tanker deal at nna..Nm owns 60 % of NNa
    Someone asked yesterday about Nm and its ownership of NNM and NNA
    Last qtr Nm earning presentation has a good slide what each company does and what they own
    NNA -s in tankers
    NMM dry bulkers, long term leases with hi payout
    NM bulkers and owns a portion of NNA 60 % and NMM around 35 %
    and a south american logistics business
    I like all 3 names but only own Nm
    NNA has warrants outstanding which might be a good play to buy and put them away

  68. 68
    elduque Says:

    re SWN – does anybody have a copy of the buy report?

  69. 69
    bill Says:

    I'm not selling Nm in the 5's..The current lousy spot rate has hammered bulker names but NM is 99 % covered for 2010 and 70 % covered for 2011so the current spot means nothing to their earnings.
    They have a bunch of ships being delivered between now and end of year (already leased) so that means more operating days, more revenue,more ebitda
    Id take some off the table in the 7's. They pay a 5 % divy, the ceo owns 20 % of the stock and highly motivated to get the price up
    This might be a good name to study the charts and sell some on the next up move of the bdi. The bdi fell 38 straight days and now we had 3 up days.
    i want to wait at least thru earnings.
    Look for Nm to keep selling capes to NMM last one was for110 m and they are buying new ones for 60 m.
    i see a secondary for NMM coming within 30 days

  70. 70
    cargocult Says:

    Bill, all NM update are welcome!

  71. 71
    crysball Says:

    SSN……..voted to depart  all  postions….all brokerage accounts
    Matt  Simmons  is on Bloomberg  making some way out  in ' 'left field' statements……….saying BP &  Gov't  are covering up  a  much larger disaster ………….cost to clean up will eceed $1 Trillion, ….ad nauseum….almost embarassing.

  72. 72
    zman Says:


    SSN – Out on half of my position at an average cost of $1.30, up 110% to my average cost. Stock could still travel higher and may if they get their acreage sale at the high end of the range by July 26th but the recent action in the name has discounted much of the move and at the present time it seems prudent to take some profits.

  73. 73
    bill Says:

    Democrats love to hold up progress.. moratorium's we got moratoriums
    Pittsburgh City Council members Tuesday unanimously passed a resolution calling for a one-year moratorium on Marcellus Shale gas drilling in Pennsylvania. The resolution is in support of legislation introduced by state Sen. Jim Ferlo and drew the ire of the producer-backed Marcellus Shale Coalition (MSC).
    "Today's action by the Pittsburgh City Council is unfortunate, unnecessary and frankly, ill-advised," said MSC President Kathryn Klaber. "Most troubling, it comes at a time when the responsible development of clean-burning natural gas from the Marcellus is creating tens of thousands of jobs for residents all across the Commonwealth, breathing new life into our economy at a time and place when it's perhaps never been needed more.

  74. 74
    bill Says:

    Prospects of a significant heat wave in the South later this week, along with the growing likelihood of a tropical storm that could enter the Gulf of Mexico, caused mostly small gains at a large majority of locations Tuesday.
    Nearly all of the increases were in single digits in ranging from 2-3 cents to about 15 cents. A spike of more than $1.50 at the Florida citygate, where an Overage Alert Day by Florida Gas Transmission has been in effect for two weeks now, was way outside the general market trend. Numbers that were flat to a couple of pennies lower were most prevalent in western markets.
    Expected increases in air conditioning load, along with the rebound of 8 cents Tuesday by August futures (see related story) and the potential storm threat to offshore production, are likely to keep most of the cash market on the rise Wednesday, one source said.
    A tropical wave farther to the west in the Caribbean Sea had dissipated overnight, but the National Hurricane Center (NHC) was giving significantly increased odds (60%) of another "vigorous" tropical wave having favorable environmental conditions for developing into a tropical depression or tropical storm with the following 48 hours. Showers and thunderstorms associated with the wave extended from the northern Leeward Islands to Hispaniola Thursday afternoon, NHC said. It was expected to move toward the west-northwest at about 10 mph.
    Highs in the low to mid 90s will be common Wednesday from Oklahoma and Texas through the South Atlantic coast and are expected to keep rising slowly as the week continues. New England will be mostly on the mild side, but peaks in the 90 area will continue in the lower Northeast and get closer to 100 in parts of the Mid-Atlantic, The Weather Channel said.
    The Midwest is due to warm slightly but stay fairly moderate with peaks limited to the mid 80s. Meanwhile, the desert Southwest is the only seriously hot section of the West, with most of the rest of the region having a forecast of cool to moderately warm.
    Kern River said linepack had returned to normal Tuesday after being below minimum target levels in the last few days.
    Some weather predictions are starting to get "intensely hot" again, said a Midcontinent producer, and it looks like that will continue through at least the end of the week. He reported getting intraday supply orders from some industrial end-user buyers, which resulted in pretty constant demand throughout the morning with no dropoff in prices.
    The producer said his perception was that some storage holders have begun liquidating inventories a bit into what looks like a firming market, with hopes of reinjecting the gas at cheaper prices later. He said the Midcontinent has gotten very little rain since the remnants of Hurricane Alex faded earlier this month, and that is contributing to gas-fired power generation demand.
    "Pretty much every industrial customer is in the hunt for gas" currently, the producer added, saying he had seen quite a few of them looking for term contracts in requests for proposals in order to lock in prices for a while.
    There's not much weather-based demand in the West for now, said a Rockies producer, who noted that CIG basis relative to Henry Hub had widened slightly to about minus 78 cents Tuesday after holding pretty steadily at minus 75 cents in recent weeks. He said production flows from Western Canada into the Rockies had been increasing recently, which tended to limit any potential Rockies price hikes.
    Conditions were on the cool side Tuesday in Denver after the metro area recorded a date-specific record high of 102 last Saturday, the producer said. He is hoping that a forecast heat wave late this week in the Southeast, when peak temperatures are expected to approach the century mark, will give a boost to the overall cash market. At the very least such heat levels ought to encourage more fuel-switching to gas, he said.
    The National Weather Service (NWS) predicts above-normal temperatures during the July 26-30 workweek extending from most of the East Coast (excluding upper New England and the Florida peninsula) into much of East Texas and all of Oklahoma at the southern end and into southeastern Montana, all of Wyoming and most of Colorado at the northern end. The only area where NWS looks for below-normal readings is along the southern half of the California coast.

  75. 75
    zman Says:

    re 73. That's been coming for a couple of months now. Few expect it to pass.

  76. 76
    zman Says:

    Re 71, sorry for the delayed response but was working that trade. Matt seems more and more off his nut these days. Did he actually pull out the $1 Trillion dollar bomb? Nutty. I like Matt or at least his work historically but unless he has some kind of math to back that up he's gone round the bend.

  77. 77
    zman Says:

    That tropical wave looks a little less disorganized to me but they still put the 48 hour chance of development at 60% with most tracks going across the keys and right to NOLA.

  78. 78
    zman Says:

    ECA call starts in 5 minutes, stock down 1.35 (4%) at $31.38.


  79. 79
    zman Says:

    ECA Call Notes:

    $500mm additional capex – used to accelerate US and Canada projects (duh)

    Horn River – latest well 10,000 foot lateral, 28 stages, not yet completed

    Montney – also going longer.


  80. 80
    zman Says:


    ECA  – Added (10) ECA August $34 Calls for $0.30 as the conference call starts. See post for details on the quarter. The stock came off a little over 4% pre call on the higher spending plan. My sense is they will flesh this out on the call to the Street's satisfaction. See the site for further comments as the call progresses.

  81. 81
    zman Says:

    80 was done with the stock at 31.72.

    ECA Notes:

    Operations update was pretty much a read through of the press release which is typical. Expecting more detail in the Q&A.

  82. 82
    choices Says:

    #68-elduque-I do not have but also noted that Global Hunter initiated coverage of  RRC,UPL,and CHK with buy rating-there could be others
    you may already have seen but here is SWN's latest presentation-Jul 2010:

  83. 83
    bill Says:

    i think mcf breaks even or even loses money last qtr

    We will invest approximately $20.6 million to pay for our dry holes at Vermillion 155 and Matagorda Island 617.
    production about 6.7 bcf
    avg sell prices about 1 buck lower

    a 4.2 m hit for lower reserves and the dda rate will be 20 to 25 cents higher going forward
    21 m in exploration expenses

    Todays press release is good news, but thats going forward, ie next qtr
    If he doesnt have 1 time divy, the stock will get hammered on earnings

  84. 84
    zman Says:

    re 83, already hammered, should be more concerned with the plan going forward. Normally, I say that since exploration gets backed back out to get to CFPS it won't hurt them but they don't really have any coverage anyway.

  85. 85
    1520sbroad Says:

    #68 and 82 – I emailed to get the full report from Global Hunter – haven't heard back.  SWN was started with $52 target.  estimates for earnings/revs look a shade higher than some others I have seen.

  86. 86
    zman Says:

    ECA Notes:

    They are planning to develop 5 sections from one pad in the Horn River, 16 wells per pad. Could go higher. 

  87. 87
    zman Says:

    ECA Q&A

    Spending up but only small change in production guidance question. Didn't get what I'd call a satisfactory guidance. Possible they are bagging the Street on year end exit.

  88. 88
    zman Says:

    ECA Call Notes:

    Important ? from Bob Morris at Citi

    Asking about cost of supply coming down. Pointing out that they are essentially saying the Haynesville is economic at $3.85 after they said they would still be drilling, even if they didn't have to get their position into HBP status. Basically he's asking why they think the margin price of gas is up at $6.

    Their answer is essentially that not all gas comes from shale plays. Troubling that they said they would keep the pace up in the Haynesville even without land pressures because they could drill on multi well pads (gas factories) vs scattered drilling for acreage hold now.


    Brent Miller well comment: the well performed as well as any well they have seen in the Haynesville, easier to get longer wells drilled in Tex than in La.

    Hedges – does your threshold on hedged gas price come down as your cost of supply come down? Yes. Their longer term view of gas prices has come down. Also, mentioned all of the liquids seeking wells that will have associated gas that will come on no matter the price of gas as a reason for longer, lower pricing.


  89. 89
    zman Says:

    ECA Notes

    Deep Panuke wells taking a bit longer than expected, costs up 10 to 20%, on track now for mid 2011. Comes on at 200 MM/d and will have capacity of about 300 MM/d. Please with first two wells deliverability of about 50 MM/d each. This is the offshore Nova Scotia wells, I assume feeding into the Maratimes and Northeastern system.

  90. 90
    zman Says:

    ECA Q&A Notes

    $500 mm increase in capex: US $200 / $300 Canada. Just not much in the way of detail there.

    Call ended.

  91. 91
    bill Says:

    shipping to china up 20 % ytd so why is the bdi down? New delieveries.

  92. 92
    zman Says:

    Ben Bernanke Pre Game Notes:

    Ben about to speak

    Fed sees gradual rise in employment over the next 2 years, somewhat slower than we previously expected

    Uncertainty greater than normal,

    Risk for growth weighted to the downside

    Sounds like rates low for the long term

  93. 93
    bill Says:

    on tankers
    Doug Mavrinac: We are increasing our 2Q10 EPS estimates for the majority of tanker companies under
    coverage as crude tanker spot charter rates easily surpassed our expectations with the unexpected return
    of the storage trade in mid-May. In fact, beginning in early-May with the renewed economic concerns,
    crude oil prices dropped approximately $20 per barrel over a period of 14 trading days resulting in an
    increase in the 1-month contango from $2.21 per barrel in early May to $3.82 per barrel by the middle of
    the month. Correspondingly, both in-ground crude oil inventories increased with US crude oil inventories
    increasing to 365.1 MMbbls by May 21st from 360.6 MMbbls in early May and crude oil being stored on
    tankers increasing by 12 MMbbls in May.

  94. 94
    Popeye Says:

    I put all my SSN shares up for sale @ 1.35 this am but ST said I did not
     own that many. I left it at that and went for a bike ride only to get back and find that 2.5K had executed. Go figure. The rest of the shares are still on the block. This whole placement deal is sort of wonky.

  95. 95
    zman Says:

    Popeye – they just haven't settle yet according to your broker. Sort of wonky? $0.58 goes to $1.30+ is wonky. Wow … tough crowd.

  96. 96
    zman Says:

    Ben whacking the market before opening his mouth.

  97. 97
    BirdsofpreyRcool Says:

    Ben opened his mouth and whacked the mrkt… guess he didn't get the memo … "Happy Talk, Ben, Only Happy Talk"

  98. 98
    BirdsofpreyRcool Says:

    Says he's "open to new stept to keep recovery going…"
    HeadTrader says, yeah… the disco, polka, the two-step….

  99. 99
    Popeye Says:

    I still don't know what I paid. I was charged for the full amount of shares @ .63. Did anyone get charged  .58?

  100. 100
    VTZ Says:

    RE 92 – Goodbye Yen carry trade… hello continued USD carry trade, so much for all the people saying that would be a short term trade.
    Unemployment to stay or get worse.
    Hello more QE.

  101. 101
    BirdsofpreyRcool Says:

    "open to new STEPS to keep recovery going"

  102. 102
    BirdsofpreyRcool Says:

    Ben calls it "unusually uncertain times"
    No shit

  103. 103
    VTZ Says:

    Goons doing their best to make this seem like it's a deflationary event and therefore selling off gold… Too bad they are going to get run over… these are ideal conditions for gold.

  104. 104
    zman Says:

    The new deal at SSN was for $0.5777, can't balance what I paid until I get the refund, but it won't be the higher figure over $0.63 according to the revised rights offering.

  105. 105
    VTZ Says:

    Haha, apparently from the USD rally this is strong USD rhetoric.

  106. 106
    zman Says:

    Senate Bill proposed half of U.S. cars be electric by 2030. Says that will cut emissions and dependence on foreign oil. It would certainly increase dependence on domestic cola. I wonder if these guys even know where U.S. electricity comes from.  Roughly:

    50% Coal

    20% Natural Gas

    20% Nukes

    10% hydro, solar, geothermal, biogas, and fuel oil.

    Good luck getting it passed before the elections and good luck retooling the U.S. generation-scape to accommodate the extra load and not use MORE coal.

  107. 107
    1520sbroad Says:

    #106 – i was trying to figure out what cola had to do with electric cars… i listened to the Coca-Cola conference call earlier.

  108. 108
    ram Says:

    ZMAN – ECA possibly overdone to the down side?

  109. 109
    zman Says:

    Ram – I think so but market very much in the drivers seat at the moment.

  110. 110
    zman Says:

    Story out saying BP may go for static kill this weekend.

  111. 111
    zman Says:

    Ben saying he still has options but has not examined them closely enough to decide which are the leading options. They won't be the conventional options (yeah, because we're at 0% rates now). Ya know, if BP had this much time and was not sure of which option they should take they'd be keel hauled. But Ben "I didn't see the first one coming either" Bernanke gets to keep his job and say "yep, thinks are uncertain".

  112. 112
    zman Says:

    Stepping out for a late bite.

  113. 113
    BirdsofpreyRcool Says:

    Gee… does anyone in Washington REALLY wonder WHY "no one is hiring"???
    HeadTrader just sent me this, from some blog somewhere…
    I've just confirmed with the resident expert in my congressman's DC office that beginning on 1/1/12, businesses, including small businesses and the self employed will be required to provide Form 1099's to the IRS for any purchases of goods and services in excess of $600. Are you kidding me? This congress and administration are killing us with regulation. Any wonder why businesses are hunkered down, hoarding cash and not hiring? What's worse is that this provision, Section 9006, is from the healthcare bill!!! What else don't we know?

  114. 114
    md Says:

    Ben needs a containment cap

  115. 115
    Nicky Says:

    SPX has to hold 1065 at the close to keep the 10 day cycle pointing higher.

  116. 116
    ram Says:

    ZMAN – Wasn't NICKY'S recent WOW a swift pullback could come before markets resume higher?

  117. 117
    ram Says:

    Hey, there you are Nicky.

  118. 118
    Nicky Says:

    Ram its pulling back further than I would have liked so watching the close…

  119. 119
    AAA Says:

    Where is the PPT?  Out playing golf with Obama?

  120. 120
    BirdsofpreyRcool Says:

    XACS#1 is pointing out that prior to the Flash Crash, we had seen credit widening, widening, and widerning… THEN equities crashed.
    We are seeing the opposite here.  Credit is going wider… but only b/c equities are so squirrely.

  121. 121
    AAA Says:

    I wonder if Bernanke considered having the Fed buy everyone an iPhone or Ipad?  Unless they make over $250k of course.

  122. 122
    bill Says:

    >Senate Bill proposed half of U.S. cars be electric by 2030
    yeah we get the golf carts, politicians will get the suv's

  123. 123
    tomdavis12 Says:

    Z: Give me "irrational exuberance" over "unusually uncertain" any day. 

  124. 124
    zman Says:

    SSN red, volume over 4 mm shares.

  125. 125
    cargocult Says:

    Z-you gave the signal and somebody sold almost 500,000 shares of SSN. We're those all in your account?

  126. 126
    zman Says:

    Cargo – unfortunately no but I have an idea who dropped that load.

  127. 127
    zman Says:

    CVX, COP, XOM and Shell start $1B fund for oil spill containment system.

  128. 128
    elijahwc Says:

    Methinks it is time to step into the elevator and buy a few high beta names

  129. 129
    jy Says:

    Re #47
    Well drilled by Texaco in 1999 on MC Blk 252 (Macondo Blk) found thin pays but not produced; likely deemed non commercial in 5,000' water w/no nearby infrastructure.  A subsea completion plus tieback likely to cost $60-120 million in those depths.
    Sorry to be so slow on reply but was attending the "Rally for Economic Survival" here in Lafayette, LA today.

  130. 130
    zman Says:

    JY – thanks, so we're back to square 1 on the leak as I have it from NFX that Rigel is not leaking.

  131. 131
    skimo Says:

    Z, LINE is looking pretty good, is there a catalyst that is going to drive it much higher or does this look like a near term exit point to try the wash rinse repeat cycle when it gets back below 25?

  132. 132
    zman Says:


  133. 133
    Jerome Blank Says:

    SSN, for folks still holding SSN, the daily is still holding up technically, closing well above yesterday's low, the gap higher from this morning held.  Next major support is $1.05-$1.10, I also still have 1/2 of my position,. I'll see how the stock performs from here….

  134. 134
    zman Says:

    Ski – I think you have a very small shot at small bump to the distribution rate in the next 3 to 6 months. In the very near term you will have some granite wash well results, which could make them the most interesting of the normally humdrum yield plays.

  135. 135
    zman Says:

    JB – I fully expect it to go higher than the recent high on the day the deal closes. Assuming it closes which I think it will. I don't know it well and so I took half of the table to play with house money on the rest.

  136. 136
    zman Says:

    NFX on the tape with operations update, earnings there are Friday. Skimming….

  137. 137
    Jerome Blank Says:

    NFX  holding right at the 200 SMA today, getting a bit easier to manage now, ideal long try at about $49 if it gets there…

  138. 138
    zman Says:

    Big well for NFX on a short lateral in the Bakken, IP of 3,800 boepd.

  139. 139
    elijahwc Says:

    Aubrey sighting as Chesapeake Energy commences 21.25 mln share public offering

  140. 140
    elijahwc Says:

    #139 IPO of Mid-Stream asset.  This is  value added

  141. 141
    zman Says:

    NFX at top end of production range guidance, reiterating full year (there was no chance they'd raise it after the deal in Malaysia forced a short shut in, at least no chance this quarter).

  142. 142
    BirdsofpreyRcool Says:

    IP of 3,800 for a 4k ft lateral with EURs of 400-700k is just mind-blowing.  Completed well costs appear to be creeping up, however.  NFX says $6-8mm, but doesn't say if that is for short/long lateral completions.  Still, completion techniques seem to keep improving, raising EURs.  This has got to be good for year end reserve reports, I would think.

  143. 143
    zman Says:

    BOP – I would think so too. I know BEXP has recently said $8 to $9 mm a pop for the longer lateral 36 stage wells.

    That EUR NFX is quoting of 500 to 750,000 boe is nice for a short well too.


    OK, really beerthirty now.

  144. 144
    blackgold39 Says:

    Feinstein on CSPAN explaining BP's blossoming liability through the 20B slush fund they've been extorted into creating. Entertaining if nothing else

  145. 145
    BirdsofpreyRcool Says:

    BedTime Market Strategist
    Ben Not Blinking
    The real trading action started today when Chairman Bernanke's prepared remarks hit the newswires at 2 pm. We think the culprit was the following headline, "… the economic outlook remains unusually uncertain." Out of context, such a headline could easily be interpreted as a negative omen for the economy. In fact, the statement was a qualifier at the end of a page of testimony about the exit strategy. The entire statement was "Of course, even as the Federal Reserve continues prudent planning for the ultimate withdrawal of extraordinary monetary policy accommodation, we also recognize that the economic outlook remains unusually uncertain." In other words, the Fed is saying that they have an exit strategy but now is not the time to implement it. Later in the testimony, when asked about the prospects for a double dip by Senator Corker, Bernanke responded, "But I'd like to emphasize that our forecast, our expectation is still for a moderate recovery. The numbers I gave today of 3, 3 and a half percent, depending on the horizon, which will, over time, bring down the unemployment rate. So that's still our main scenario, that the economy will continue to grow, and that the final demand — private final demand will take over from inventory building and fiscal policy as the drivers of growth."
    It is clear that the Chairman's forecast is above most of the Street. Forecasting the recovery to be at the high end of expectations means that the Chairman can't be advocating additional easing in the near term. It is important to remember that one of the key focuses of the most recent FOMC meetings is asset sales to shrink the Fed's balance sheet. Although the FOMC is not ready to pull the trigger on that yet, you have a Fed contemplating its exit strategy while the stock market is clamoring for clarity about new potential easing. That is an interesting disconnect, and surely one that feeds volatility. Even better, according to the Chairman, the Fed is not planning for a double-dip at least not yet. "You know, that being said, if the — if the recovery seems to be faltering, then we would at least need to review our options, and we have not fully done that review, and we need to think about possibilities." To this point, the Fed may want to be a little more proactive in its contingency planning.
    One of the big concerns out there in the market is that investors wanted the Chairman to show up well armed with several policy options to reinforce that the FOMC is not constrained by the zero bound on interest rates. As the previous quote illustrates, he is still thinking about it. Senator Shelby specifically asked if the Fed was running out of options if the economy slows. The Chairman said he believed the Fed still has options. More specifically, while reasserting that current policy is stimulative, Bernanke lobbed three potential options: jawboning, reducing the IOER from 25 basis points to zero and finally replacing securities running off the balance sheet with new purchases or even making additional purchases. There is no doubt that those are basically uninspiring responses to the question, "Are you out of bullets?"
    The fact is the Fed Chairman did not really answer the question "Are you out of bullets?" We know what you are thinking, and no, the correct answer is NOT "They are." It is actually quite the contrary. Has the market forgotten the alphabet soup of programs created by the Fed led by this Chairman 18-24 months ago? The Europeans have not forgot them, they are the foundation for the ECB's 2010 playbook. Here in the U.S., almost all of the emergency measures have been wound down. Some worked, some did not work. The point is the only thing that limits the Federal Reserve's options is Ben Bernanke's imagination. There was once a time we believed the Fed could run out of bullets, but recent history has proven otherwise. It is not a finite world and to believe it is can be dangerous.

  146. 146
    VTZ Says:

    I disagree with the Bedtime Market Strategist completely and think that the tone was an attempt to justify the upcoming QE due to uncertain times. He does not however want to erode any semblance of confidence in the market or he would have been criticized for that. 
    99 weeks for unemployment will help to guarantee more QE. Things are not looking up for the recovery. 

  147. 147
    zman Says:

    LINN Energy, LLC (Nasdaq:LINE – News) announced today results from its second operated horizontal Granite Wash well in the Stiles Ranch area of the Texas Panhandle. The Company owns a 63 percent working interest in the Black 50-1H well, which tested at a 24-hour production rate of 27.0 MMcf/d of natural gas and 3,190 Bbls/d of condensate at 2,150 psi flowing surface pressure. The natural gas production has a heating value of 1,316 Btu/cf, and when processed, should yield approximately 3,530 Bbls/d of natural gas liquids. Including estimated NGL recoveries and shrinkage associated with processing the natural gas, the Black 50-1H well produced approximately 60.2 MMcfe/d.

    “The outstanding results from this second well are considerably above what we expected. We believe this is the highest rate well reported in the Granite Wash trend. The liquids content of over 6,700 Bbls/d represents more than 65 percent of the production stream and we anticipate pay-out on this well in as little as two months. The well is located in an area where LINN has a large concentrated acreage position. As a result, there are numerous follow-up drilling opportunities,” said Mark E. Ellis, President and Chief Executive Officer of LINN Energy. “Our operating team has continued to drill horizontal Granite Wash wells in less drilling days and at lower costs than expected. The Granite Wash area is a major component of our drilling program and is expected to provide significant organic growth for the Company.”

    Wondering who the partner is. Stiles Ranch is NFX country either way.

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