Monday Morning And All Is Free Today

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Market Sentiment Watch: Europe again in focus after Greek parliament passes austerity bill. Futures saw a bounce overnight. This weeks brings more in the way of economic data including more housing stats that are suggesting continued modestly improving conditions. In today's post please find the earnings calendar for the fourth week of energy earnings season (still pretty light as E&Ps go with a couple of big cap exceptions one of which is own in the ZLT) and a new feature for all Monday posts from now on "The Week That Was Watch", a summary of the highlights of last week's post, commentary and maybe some stuff that didn't get noticed but should have.

Ecodata Watch:

  • No ecodata scheduled

The Week Ahead:

  • Tuesday 2/14: NFIB small business index, Retail Sales (F = 1.0%, 0.7% ex autos), import prices, inventories,
  • Wednesday 2/15: EIA Oil Inventory Report, Empire State Index (F = 15, last read 13.5), capacity utilization, home builder's index (F = 26, last read was 25), FOM minutes,
  • Thursday 2/16: EIA Natural Gas Inventory Report, jobless claims (F = 365,000), PPI (F = 0.5%, core = 0.2%), housing starts (F = 683,000, last read was 657,000, Philly Fed,
  • Friday 2/17: CPI (F = 0.3%, core = 0.2%), leading indicators (F = 0.5%, last reading was 0.4%).

In Today’s Post:

  1. Holdings Watch
  2. Commodity Watch
  3. Stuff We Care About Today - Energy Earnings 4Q11 - Week 4, The Week That Was Watch, CHK
  4. Odds & Ends

Holdings Watch:

  • ZMT (Zman Medium Term portfolio)  - is updated on the ZEB Positions.

Commodity Watch

Crude oil closed up 1% last week to close at $98.67 (WTI) while Brent rose 2% ending the week at $117.31. Crude is essentially trading with the market with a slight upward bias due to Iran, Nigeria, Sudan. This morning crude is trading a buck plus.

  • Iran Watch (Nuclear Edition): Admad is a nutbag but he likes his nukes, ahem, nuclear program and he's promising to unveil "big new" nuclear achievements this week. He also vowed to never give up their uranium enrichment program.
  • Gasoline Demand Watch: Was asked about this on Friday while I was out, the question was if gasoline demand was truly lower. My answer is that it is lower yes, and at the bottom end of seasonal norms for this time of year. Here's the line chart for U.S. gasoline demand.

Natural gas slipped 2 pennies to close at $2.48 on Friday after EIA reported another small withdrawal from storage. The weather has turned cold in the nation's mid section for the first time in recent memory and this may give natural gas short term boost but the storage overhang will remain the dominant factor through Spring. This morning gas is trading off slightly.

  • Weather Watch: Somewhat Colder
    • Last week saw heating degree days of 190 vs 152 in the prior week (which produced the paltry 78 Bcf withdrawal last Thursday).
    • This week's forecast calls for HDDs of 182 vs 198 normal for this time of year.

Stuff We Care About Today

What I am looking for / Why I'm watching:

  • FTI
    • I don't own it
    • Just keeping tabs on the health of the deepwater market, listening for color and scale of ramp in various parts of the globe.
  • DVN
    • I don't own it
    • Keeping tabs on the story in general
    • These guys should be getting into acquisition mode soon
    • But also listening for their comments on the Brown Dense (if any) as well. They should be able to report their first results in another two months but any color they can provide will help with establishing my view of this emerging play
  • XEC
    • I don't own it
    • Listening for color on their Cana/Woodford operations (Cana deep).
  • OII
    • I own it in the ZLT
    • Looking for inline to a small beat on EPS
    • Looking for them to affirm that operating margins will rise this year close to 20%
    • And that ROV utilization will average above 80%.
    • Looking for them to guide in line with (straddling) the upper end of current Street EPS.
  • VQ
    • I don't own it
    • Just watching to see if the buyout is a go or not. DR Link, I declared you winner here too soon, this deal is apparently not yet definitely done.
  • EOG
    • I own it in the ZLT
    • Expecting another stronger than Street expectation quarter as far as the quarterly numbers go (so should everyone else be)
    • Looking for them to up their "captured reserves" for the Eagle Ford shale over the 900 mm BOE they have been talking for the last two years as they report another set of strong wells
    • Looking for them to hint at another oil stealth play in the U.S.
    • Looking for them to talk about their first, currently drilling, well in Argentina in a positive light
  • ECA
    • I don't own it
    • Will listen as I want to hear what big cap gassy name like ECA does at this point.
    • Capital spending should be ratcheted back severely.


Fraccing Friday Wrap

  • Two words: Very Cool
  • I essentially had full access to two well pads in the Arkoma that were in the process of being completed for pretty much all of Friday.
  • Huge thanks to the guys from the Operator for taking me through it all and for their patience in answering my questions and keeping me from getting spindled, folded, or otherwise mutilated
  • Wireline van was cool, thanks to the Key and HAL guys for taking me through it step by step and for the frac ball which is the coolest non-magnetizable paper weight I now own. Got to watch as a plug was set and then as the wireline came up hole, detonating perf guns along the way to complete one stage.
  • Have to say the HAL 5000 Command Center is the baddest RV out there. No other has that many screens and computers tied into corporate via satellite. Simply amazing and although they assured me that its all pretty straight forward and by no means rocket science it did have that mission control feel to it.
  • Anyway, this doesn't do the day justice but thanks to the Operator, HAL guys and others for a high speed education in horizontal hydraulic fracturing. And I do appreciate the offer of the sack cutter job but alas, I have decided to stick with my current gig.

Other Stuff

  • HAL and Petronas sign global shale development deal.
  • BCEI - look for reserves early this week.
  • Later this week look for a Catalyst List update and a Bakken Players update.
  • CHK Talks 2012 Monetizations
    • Looking to sell or monetize $10 to $12 B in assets in next 12 months
    • Combination of VPPs and JVs including Granite Wash, MS LIME, and Permian
    • Saying rising liquids profile will result in equalibrium in 2014.

Odds & Ends

Analyst Watch:

  • CJES - JPM cuts target by $9 to $41
  • SD - Stifel ups to Buy
  • PVA - Stifel ups to Buy
  • FTI - Global Hunter cuts to Neutral
  • ACI - Brean cuts to Hold
  • CCJ - Dahlman trims target by $2 to $30, stays Buy

175 Responses to “Monday Morning And All Is Free Today”

  1. 1
    milepost_43 Says:

    OII to BUY @ GS

    Gasoline usage falling..why??..Best graphs I’ve seen vis a vis this conundrum and his conclusion…recession coming…


  2. 2
    zman Says:

    Re OII – a little late there

    Re Gasoline – I prefer my range graph to the one I put in today’s post but the emailer wanted a long term perspective. I don’t see it as recessionary, I do see it to be the result of higher pump prices combined with persistent high unemployment and a real unemployment level that rests in the teens and not at 8%. I see gasoline demand rising again seasonally near term. Spoke with my local service station guy who does mostly contract business for hospitals, law firms etc, business remains strong, margins thin as usual but strong order flow.

  3. 3
    tomdavis12 Says:

    Z: The Bakken Boy stock are acting like NG stock when the fear of full inventory happens. Since there is a capacity issue (not being able to get everything out), which companies would you expect to be most effected, least effected and what is your time frame as to how the issue gets resolved. You mentioned a pipeline opening in April? Noticed that the Clearbrook MN price of crude has gone from $100/bl to $70/bl. EXXI looking better all the time.

  4. 4
    zman Says:

    re 3 – I think the whole thing is overstated and I disagree with your analogy. This is a pull back off the top, not a death spiral. EOG will probably be least affected but they are not a pure player. Otherwise, I don’t see one being advantaged over another on the list. Clearbrook pricing is by no means the Bakken. April is actually a rail date.

  5. 5
    Zorgnak Says:

    S&P Futures Short Term Areas Of Interest ..2/13 8:46am ..S&P Futs @ 1349.50. NOTES. O/N session tested resistance at 1352.50. Currently trading above the 1339.25 pivot. Support 1332. Expect consolidation above 1332 support to continue in the short term. Longer term upside bias continues.

    CLVN= Low Volume Rejecton Area – CHVN = High Volume Acceptance/Congestion – VPOC Most Accepted Session Price
    1362.50 Congestion/Minor CHVN
    1352.50 Resistance/Major CLVN
    1339.25 Pivot/MCHVN
    1332 Support/CLVN
    1322 Acceptance/ CHVN
    1317.50 Key Support/CLVN,
    1310.50 Acceptance/Major CHVN

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


  6. 6
    elduque Says:

    Early morning OT’s.

    BDI start to firm up. +14 to 729

    TED -.80 to 41.62

  7. 7
    Zorgnak Says:

    Crude Futures
    Trading above long and short acceptance. Volume demand is supportive


  8. 8
    Pangloss Says:

    Seems to be hyper concern over stagnant oil in the Bakken. Can you be a bit more clear why you don’t feel this is such an issue Z.

  9. 9
    zman Says:

    re 8

    1) It’s been going on a week
    2) The concern is in part being drummed up by the sellside over a one week adjustment in price, their job is generate commissions. I have read several notes by them and they are all pretty clueless on the subject.
    3) The Williston will see large scale takeaway capacity additions this year and next.
    4) If the price stays low for any length of time operators will find alternative routes for crude (including trucks and rail) that won’t be as high as the spread we have seen over the last week.
    5) More rail comes on in April.
    6) The Whiting refinery went offline at the beginning of the price drop, taking away significant market for crude, it is back online.
    7) This is also the result of high basin wide production due to better than expected weather. More opportunities for more pipe capacity, if it persists it will accelerate capacity expansion.

  10. 10
    elduque Says:

    Ah we need more analysts who don’t have a clue. It creates opportunities that otherwise wouldn’t be there. That is why Z, you are so valuable.

  11. 11
    zman Says:

    8. Historically these snap differential collapses out of hot basins have been short lived
    9) See page 15 here

  12. 12
    Zorgnak Says:

    Crude Futs popping through 100

  13. 13
    zman Says:

    Crude spiking over $100


    … too early in my book but we are oscillating in this $95 to $103 range (or thereabouts). My 1Q12 WTI target remains $95 and I generally set them to be bested by reality by $2 to $3 at least. I think anything in 1Q over $100 is not sustainable and attracts hot money that doesn’t know stories, or valuations, just tickers … call it momo money or annoying money or mad money, it comes in and I have been planning to do some more trading position trimming so I’ll gladly give them some of my position should they run them.

    Too kind Eld, just telling you what I think, I suppose I could be the clueless one.

  14. 14
    tomdavis12 Says:

    Analyst Watch: Ole at MS calling for $700K/day with UDW rigs. The combination of the Angola Pre Salt & the PBR order for 26 rigs has put asset owners & equipment manu in a sweet spot.

  15. 15
    Pangloss Says:

    Thx Z

  16. 16
    zman Says:

    Tom – I do agree completely with you on the EXXI and on names like EPL and some of the Eagle Ford guys who are getting their crude to the coast and getting LLS pricing at $15 > WTI.

  17. 17
    tomdavis12 Says:

    Z: I officially brand you as a voice of reason. 😉

  18. 18
    tomdavis12 Says:

    PS Z Not too late to buy LINE.

  19. 19
    elduque Says:

    What sets the price for NFX’s crude. What the refiners in Utah want to pay?

  20. 20
    elduque Says:

    One other question on the Bakken. Is there any reason why the production can’t be stored or deferred?

  21. 21
    zman Says:

    re 17 – quick, someone tell Petra that.

    re 18 – I agree, been watching it laze about, down a touch from the deal price. I am thinking to get back long there in the right account and also to be in WHZ from the beginning.

    re 19 – It’s a mix as you know, as they are spread out from mid con to Rockies to deepwater and then internationally. For oil NFX gets north of 90% of WTI each quarter on average. They are another name that will get oilier this year as they shun dry gas drilling. So overall growth may not be that impressive on a pure % growth basis but we will get to watch the revenue $/BOE metric rise as the year progresses.

  22. 22
    zman Says:

    re 20 – that’s a fair question

    1) because today’s production /cash flow is tomorrow’s drilling budget
    2) the wells are still economic at current prices
    3) little local ability to store it

    If prices were to stay down for long you would see some guys slow down to try and better match up their future production growth with takeaway capacity.

  23. 23
    reefguy Says:

    HDY- completed drilling Sabu #1. Report taking sidewall core samples and fluid samples. Sounds like a dry hole to this guy.

  24. 24
    zman Says:

    Lots of weird, low volume, big over the ask moves in several names today. Probably meaningless but someone is trying to goose some names in the group. See MHR at $6.75 … I’d tell that guy “it’s a marathon, not a sprint”

    Anyone see a broker note on EXXI /MMR on Friday or today, green in a sea of red. Noted COG and SWN outperformed as well, with their Brown Dense halos.

  25. 25
    elduque Says:

    Thanks for answers.

  26. 26
    zman Says:

    re 23 – I think I read that the costs were higher than expected for the next well so their last deal didn’t raise enough cash to drill #2

  27. 27
    elduque Says:

    CHK is strong out of the gate.

  28. 28
    zman Says:

    By the way, if you have lower back issues I think I found a cure. Stand between to HAL pumps, each the size of a semi, for a couple of minutes when they are getting after a frac. Completely realigned my spine.

  29. 29
    zman Says:

    re 27 – yeah, and I have not sold mine yet but the stuff they are doing is precisely the stuff analysts hate. VPPs are seen as debt, and JVs have not gotten a lot of credit. CF equilibrium seen in 2014 now? I’ll believe it when I see it.

  30. 30
    zman Says:

    HK rolled on cue post reverse split on Friday morning.

  31. 31
    zman Says:

    … but not much of a pullback yet.

  32. 32
    Zorgnak Says:

    S&P Futs
    ..Key level today is 1352.25..O/N confluence of O/N High and Resistance…
    If/when this is broken 1365 is the next upside target.
    To the downside..the opening gap has only a 24% chance of closing today (odds based on 2 years of data)…

  33. 33
    nrgyman Says:

    MHR on Mad Money tonight

  34. 34
    zman Says:

    Thanks for the levels in 32 and for those on the wrap this weekend Zorg.

    re 33 – ah, thanks.

  35. 35
    zman Says:

    SWN moving

  36. 36
    Zorgnak Says:

    Relative volume higher in service names than E&P so far.
    50% of Equipment and Services high relative volume
    25% in E&P

  37. 37
    elduque Says:

    I have recently started using accuweather for their long range forecasts. This morning they are showing for the first time in the last month normal temps. for the next 30 days. However, in reading a report on reuters the reason for the drop in nat gas this morning, was a report that temps would be above average for the next 30 days. Which of the weather reports do you find to be the best? And secondly, which is the most popular one that the street uses?

  38. 38
    zman Says:

    The Street generally uses private services, I don’t know who is popular now, Accuweather was but Bastardi left, Wunderground, Intellicast are used by some. I don’t use any one of them consistently any more, nobody I have seen was accurate this year as the Jet Stream split and shifted north. I quite the Accu pro site and am in the process of looking for a good one for summer.

  39. 39
    zman Says:

    Without economic data releases the US equity markets resume their march to boredom like clockwork. Gassier names just gave back their morning bounce.

  40. 40
    RB Says:

    WPRT is running…Bloomberg has an estimated earnings date of 2/15…

  41. 41
    zman Says:

    ZTRADE – ZMT – SWN Calls

    SWN – Added (5) Feb $33 Calls for $1, with the stock at $33.53. Higher risk trade given expiry this Friday.

  42. 42
    zman Says:

    re 40 – thanks for that, will listen.

  43. 43
    Zorgnak Says:

    EPL pulling back on low volume today…sellers dried up below 16.30 last time down


  44. 44
    RB Says:

    just added to FTK at 10.51…old limit order I liked on a chart some time back…

  45. 45
    zman Says:

    Tom or anyone, do you see timing on the WHZ IPO?

  46. 46
    brodway Says:

    Nice pickup RB. I way eyeing it but haven’t pulled the trigger yet.

  47. 47
    brodway Says:

    re: 41

    interesting trading in SWN and CHK today. looked like an aggressive buyer this morning faded and both have come down again.

  48. 48
    elduque Says:

    OAS moving back up.

  49. 49
    zman Says:

    HK up 3%, not much of a pullback yet. If it runs back to $13 ish I will punt my last 1/4 position and await a downdraft.

  50. 50
    RB Says:

    SSN has found some love in the past half hour….

  51. 51
    elduque Says:

    If Aubrey punted the Permian position, wouldn’t that make a huge difference to the company?

  52. 52
    zman Says:

    re 51 – it would be material, were he to sell it outright, good time to be selling oily production. The JVs don’t get him much traction with the Street … why I am not sure. He’s the best landman I have ever seen.

  53. 53
    Zorgnak Says:

    EXXI volume spike coming in at the lod

  54. 54
    elijahwc Says:

    FYI: CVI, the refiner will commence a regular .08 dividend and will be paying a special.

  55. 55
    elijahwc Says:

    Just heard Floyd Wilson next up on CNBC

  56. 56
    nrgyman Says:

    HK–Floyd on CNBC coming up

  57. 57
    J.J. Says:

    RJ added Whiting Petroleum (WLL $51.22)to their select list

  58. 58
    nrgyman Says:

    Z, have you seen the CS report about the expected returns on each of the shale basins, given the current strip pricing? From what I have seen reported it is interesting and perhaps controversial.

  59. 59
    J.J. Says:

    Zman- did you look at Quicksilver Production Partners (QPP) Barnett Shale MLP spin off from Quicksilver? Thoughts?

  60. 60
    zman Says:

    re 55/56 – thanks. Would not expect him to say anything he didn’t last week. CNBC interviews are generally so high level they are low value adds but it may give me my near term exit.

  61. 61
    zman Says:

    re 58 – I have not seen it.

    re 59 – No, have not. Probably should but not really interested in gassy MLPs at this time, maybe in the late Spring.

  62. 62
    zman Says:

    CNBC showing an actual dog to pick the dogs of the dow. That’s gotta be a new low.

  63. 63
    Zorgnak Says:

    Re #57 WLL 4th breakout attempt at 52 coming up?

  64. 64
    nrgyman Says:

    RE 58: From a message board poster, so the accuracy can be questioned, but it looks legit:

    “Looked at a chart from CS, they show their calculation of returns at the strip for each of the major plays. Miss, EF and Wattenberg are around 50%. Then it’s Wolfcamp, Uinta, Wolfberry, Marcellus SW Liquids and Bakken in the 30% range. The Woodford Cana and Marcellus SW round out the top 10 in the 20% range. The rest of the plays are less than 20% at the current strip. The dry gas plays come in around 10%, in that group is the Haynesville.

    They also show companies with the greatest acreage positions in the shale liquids plays, CHK is pushing 4 million acres, they have 1.4 million in the Utica alone. Next is EOG, SD and DVN at around 1.5 million.

    Looks like the Utica will be in the top return range, CHK outside of ATLS is has the most concentration, about $23k of enterprise value per acre. ATLS is at $6k. For SD and the Miss concentration, their 1.5 million acres is valued at less than $5k of enterprise value per acre. ATLS, SD and CHK look like good values if you think oil stays at near $100.”

  65. 65
    petrodollar Says:

    Floyd Wilson on CNBC in a minute.

  66. 66
    zman Says:

    CNBC needs a guy who can ask E&P questions.

  67. 67
    zman Says:

    CNBC’s map shows MS Lime (Osage concession) down by Corpus Christi, lol.

  68. 68
    Zorgnak Says:

    Volume picked up in the E&P stocks after the low of the day

  69. 69
    zman Says:

    HK CNBC pump underway. Never mind valuation, just run it on Floyd’s resume.

  70. 70
    Dillon Says:

    scottrade finally let me short HK. So many buyers today made it possible I suppose.

  71. 71
    zman Says:


    HK – Sold the last quarter of my shares taken just before the holidays for $13.09, up 130%. Too rich for my blood, running on a CNBC interview. I will revisit again once it comes back to reality.

  72. 72
    zman Says:

    re 70 = LOL.

  73. 73
    zman Says:

    Thanks CNBC

    Offtopicthirty, grabbing lunch, snow day with the interns over 0.3 of snow that melted on impact.

  74. 74
    brodway Says:

    re: 66

    don’t they have Cramer for that? LOL

  75. 75
    zman Says:

    Housekeeping Watch:If you have any names you’d like to see added to this week’s Catalyst Update or items you see that should be on there please let me know. I am adding BCEI to Part I now.

  76. 76
    zman Says:

    and HK

    re 74 – heh, heh.

  77. 77
    zman Says:

    TPLM – continued resilience there vs other Bakkens is impressive, back to $7.50.

  78. 78
    zman Says:


    SWN – Added another trading position at $33.57. Expecting news on the Brown Dense play over the next 2 to 4 weeks from SWN and offset operators. See today’s post for more details.

  79. 79
    brodway Says:

    re: 75

    SM please

  80. 80
    zman Says:

    SM – yep, will add.

  81. 81
    zman Says:

    Crude to HOD

    Iran equipping suicide dingies

  82. 82
    john11 Says:

    Re 33, Nrgyman, MHR on cnbc mad money tonite..is that confirmed?

  83. 83
    Zorgnak Says:

    #81…OT…Iran imports over 75% of it’s food…crashing Rial and ships not calling in port should make for some internal friction..

  84. 84
    zman Says:

    re 83 – true. Gasoline also. One of the ways Ahmad has stayed in charge has been to give them next to free gas. That’s getting tougher.

  85. 85
    Zorgnak Says:

    S&P Futs..
    Trading in balance with an inside day. O/N low and today’s LOD at Friday’s low. Pattern lately has been to trade in balance and then break one way or another towards the end of the day.
    Upside resistance at 1352.50.

  86. 86
    snoles Says:

    Z – Really like your “The Week That Was” summary.

  87. 87
    zman Says:

    Bakkens bouncing with the Clearbrook, MN price. Up $8.50 from the low on Friday of $70.74.

  88. 88
    zman Says:

    re 86 – me too. What was I thinking in not doing that before? Sheesh, ugh.

  89. 89
    Zorgnak Says:

    #86 Me too..

  90. 90
    RB Says:

    there’s more lust for Floyd’s stock than I had for the high school cheerleaders…and bud that’s saying something

  91. 91
    nrgyman Says:

    RE 82: Yes. I heard Cramer say it this morning on CNBC. He said since MHR has more than doubled from Oct lows, he wants to see if this is for real. He did not give a name of who he would speak with–just that MHR would be on the show tonight. Should be interesting.

  92. 92
    zman Says:

    re 90 – ha

    re 91 – has to be Gary Evans

  93. 93
    tomdavis12 Says:

    45 WHZ No date yet RJ still lead. Remind me and I will keep checking.

  94. 94
    zman Says:

    re 93 – thanks Tom.

    OII (oh eye eye) – walking up too much for me to do anything in front of earnings later this week. I own it in the ZLT, not adding, not selling, may sell calls into the quarter if it goes higher again tomorrow.

  95. 95
    john11 Says:

    Thanks nrgyman!

  96. 96
    Zorgnak Says:

    #91..holy smokes….huge spike in volume after that post..MHR

  97. 97
    BirdsofpreyRcool Says:

    Re: MHR on Cramer tonight… got this email from MHR IR this morning. Let’s hope Gary is his usual “encouraging” self.

    Magnum Hunter Resources is pleased to announce that Gary C. Evans, Chairman and Chief Executive Officer, will participate in an interview on CNBC today. The interview will take place on CNBC’s show Mad Money which is hosted by Jim Cramer. Airtimes of the show are 5:00 PM and 10:00 PM CT. The interview will cover a broad range of topics about the oil & gas sector, including details about Magnum Hunter.

  98. 98
    zman Says:

    GDP moving better again, news on at least 3 EFS wells soon … Getting oilier fast.

  99. 99
    zman Says:

    Thanks BOP, good to see you’re back.

  100. 100
    BirdsofpreyRcool Says:

    Ha! Only half-back.

    But thx.

  101. 101
    elduque Says:

    Which half the bird or the prey?

  102. 102
    tomdavis12 Says:

    GoldmanS going from onshore service to offshore. Downgrading HP, PTEN, & BHI. Upgrading ESV, NE & OII – as mentioned earlier now on GS conviction buy list.

  103. 103
    BirdsofpreyRcool Says:

    Saw an Osprey last week, perched on top of a palm tree. Gots to say it: birds of prey ARE cool!

  104. 104
    jy Says:

    “The Week That Was..” great info and very helpful in consolidating the firehose of info that comes at you in real time!

  105. 105
    skimo Says:

    BOP, teddy cam on MMR?

  106. 106
    Zorgnak Says:

    CME crude mkts down do due to technical problems…

  107. 107
    jy Says:

    Re 103: Just don’t spot any of those birds nesting near a proposed well location in South LA! Depending on time of year you may have to shut down all operations w/in up to a 1 mile radius.

  108. 108
    BirdsofpreyRcool Says:

    So “offshore” is the hot new thing, eh? Apparently Tom Ward thinks so. Buy-siders (and industry) still shaking their heads over that acqtn (Things that Make you go Hmmmmm: couldn’t IPO
    Dynamic Offshore at $14-16, but Ward swoops in to buy at $18…). Given that the properties are soooo spread out, the thinking is that the LOEs have gotta be in the Land of the Lofty.

    But oh, there’s more…. Ward will be looking to do “bolt-on aqtns” offshore.

    This just makes me luuuuuuuvvvvv Schiller all the more.

  109. 109
    BirdsofpreyRcool Says:

    jy — #107… you joshin’ me? Them birds are pretty resilient… wouldn’t let a little thing like a derrick bother ’em. They are like honey badgers… heh heh heh.

  110. 110
    italyinvestor Says:

    MMR has some pretty good call volume going on today mostly in future months, not much on the put side and most in Feb & Mar. EXXI is quiet as is PXP.

  111. 111
    skibbi9 Says:

    Saw that BMO conf calls were put up on itunes… going back and listening to some calls I missed, or names that were interesting.

    Like the TPLM call… good straightforward message. they also seem to know who they are and who they are not.

  112. 112
    skibbi9 Says:

    @111, nm those are the Jan-2011 casts. TPLM call was at least interesting. They did go ahead with looking at being an operator i guess.

  113. 113
    zman Says:

    Thanks jy, skibbi

  114. 114
    zman Says:

    Thanks Italy, I still have MMR calls in the ZMT some of which are starting to wake up.

  115. 115
    john11 Says:

    EGY getting some attention again today.

  116. 116
    italyinvestor Says:

    Z – i’m looking at accumulation and options for MMR, EXXI and PXP for the “tell” but so far can’t see anything – of course that could be because there isn’t an won’t be one or i’m “chart blind.”

  117. 117
    BirdsofpreyRcool Says:

    #115 — maybe on the back of all the luv that CIE is getting today?

  118. 118
    Zorgnak Says:

    Crude mkts to open in 15 minutes

  119. 119
    john11 Says:

    117, yes, that certainly started the move on Friday.

  120. 120
    zman Says:


    BCEI – Added a trading position at an average $16.79. Expecting news on reserves soon and potentially an operations updated. Also expecting the name to be influenced by coming Brown Dense news from SWN, COG, DVN, and XOM.

  121. 121
    BirdsofpreyRcool Says:

    #119 — yeah… you’re right. Thanks for pointing that out!

  122. 122
    zman Says:

    Watching WHX trade up with oil. Would like to find an effective way to short that thing … puts out for me unless I see it start to crack, no telling when that wakes up to the fact that it might be worth $10 or $12 but it is certainly not worth $18+.

  123. 123
    Popeye Says:

    BOP any OT comments?

  124. 124
    zman Says:

    Rebalancing the ZMT a bit too.

  125. 125
    Pangloss Says:

    Anybody have any color on SPN the last few days. Been harsh. Cannot be pure liftboast sales rhetoric. The Goldman downgrade to onshore shouldnt affectt hem as much I would think…

  126. 126
    zman Says:


    Sold 250 TPLM at $7.43, up 37%.

    Added 150 BCEI (total of 300 now) at $16.83. To rebalance the portfolio a bit.

  127. 127
    skibbi9 Says:

    @zman/catalysts list:

    Can you add Rexx, if there are any upcoming catalysts.

  128. 128
    zman Says:

    re 127 – will do, thanks.

  129. 129
    zman Says:

    re 127, actually, just checked,

    REXX is at the top of Part II


    I’ll be updating it in Wednesday, (part I being in tomorrow’s post with new additions to the list BCEI and HK)

  130. 130
    RB Says:

    MMR hits $14…yeah baby

  131. 131
    nrgyman Says:

    RE 108: SD’s offshore deal is a head scratcher for sure. While many doubt the deal’s merits, SD has quietly outperformed since the initial shock drop when the deal was announced, closing the gap today. Today’s move is no doubt due to the CHK announcement of a future JV in the Miss Lime, which adds value to SD’s 1.5 million acres there. Also, CS reported that the Miss Lime was one of the most economic basins at current strip prices and SD is highly leveraged to it (see 64). Perhaps some skeptics see some positives in the offshore deal, instead of focusing only on the negatives.

  132. 132
    RB Says:

    buying accelerating in MMR over last 20 mins…

  133. 133
    zman Says:

    Just found out … RIP BondBuddha

  134. 134
    zman Says:

    re 131 – my thinking pre deal, just looking at the coming IPO was that DOR was fairly valued for an offshore name coming out the gate. Agree with BOP, a bit spread out and for the price I could not see why you’d go with a team that had been around since 2008 vs one like EPL that’s been doing it for a lot longer. Why anyone would go to the Shelf though is beyond me if it is not their first love. Leave it for something onshore? Sure, but the opposite. Hmmm. They must see lots of bypassed pay, nearby low risk fault blocks etc.

  135. 135
    RB Says:

    so sorry to hear re: BondBuddha

  136. 136
    RB Says:

    in my very unprofessional opinion Italy…thar’s your sign of accumulation in MMR

  137. 137
    Dillon Says:

    Question for anybody here – quarterly tax payments need to or do not need to be made on profitable trades made during the year?

    I had been factoring interest in at the IRS rate on trade profits when paying taxes previously and getting money back in the paid interest amount. I was willing to pay it so I can trade in the meantime with their money 🙂

  138. 138
    r09traveler Says:

    GMXR on fire; up 20% today

  139. 139
    RMD Says:

    YHOO news has a CHK article which includes these 2 comments on near term spinouts:
    These were supposed to be long-term cash cows that balanced out uneconomic dry gas fields.
    The sales of oil-rich assets, meanwhile, would dramatically overturn McClendon’s stated efforts to more away from an overwhelming focus on gas.
    The sidebar article has 25 questions to Aubrey from Forbes.

  140. 140
    Pati Says:

    #33 — “RIP” — Z, what does that mean?

  141. 141
    BirdsofpreyRcool Says:

    #133 — That is so very sad. I will miss Bondbuddha. I recall him posting several times from the clinic… what a wonderful person he was. So very very sad.

  142. 142
    italyinvestor Says:

    Rb – would like to see some complimentary options action in exxi but who knows. Since calls are dominating my long shares are happy.

  143. 143
    zman Says:

    re 137 – I’m not an accountant but have one. I pay quarterly estimated payments on earned income only.

    re 138 – getting close to getting sold by me as that trade is working but for the wrong reasons and its only a trade, not a Core.

    re 139 – gotta go read that.

    re 140 Rest In Peace. Cancer sucks.

    re 141 – agreed.


  144. 144
    Pati Says:

    #133, got it! I echo BOP’s comments.

  145. 145
    zman Says:

    Weren’t there a bunch of talking heads at year end 2011 targeting 1,350 S&P for YE12? Well we’re here.

  146. 146
    BirdsofpreyRcool Says:

    OT: Popeye… I would not like to be short CIGX.

    1) Stock trading well.
    2) Anatabloc picked up by GNC.
    3) Long-running tobacco patent lawsuit going into mediation (which could be a template for MO and LO next).
    4) Medical evidence leaking out about anatabine vs. inflammation and CRP reduction capabilities (Hint: there is no other drug, medicine, ointment, voo-doo, or little pill that reduces CRP and thyroiditis… which are two of the things Anatabloc does).
    5) Can raise almost $14.8mm by just calling in-the-money warrants already outstanding.
    6) CIGX lowered their price on Anatabloc… and sales seem to be moving along briskly.
    7) Probably a host of other things going on behind the curtain… but at this point, the negatives are known and the positives are continuing to build.

  147. 147
    RB Says:

    #142…per my chart software the volume in MMR over the last hour was the largest hourly volume since 1/31…put MMR up on an hourly chart and watch that booger climb from left to right starting after the firsts hour on 1/31…a true thing of beauty

  148. 148
    andy Says:

    BOP–where were u that had palm trees. down my way?/

  149. 149
    BirdsofpreyRcool Says:

    andy — down your way… and then some.

    South Water Caye, offshore Belize. No internet… but plenty of rum. Ya, mon!

  150. 150
    BirdsofpreyRcool Says:

    MMR — no ‘splanation for the move, yet. But someday I expect MMR to move like that… and just keep going… taking EXXI and PXP and maybe even CVX right along with it. That’s The Plan, anyway.

  151. 151
    zman Says:

    re 150 – not long now.

  152. 152
    snuhart Says:

    Z – Seen anything to account for today s strength in ESTE ?

  153. 153
    zman Says:

    Snu – I don’t watch them anymore but they reported 4Q results, showing strong results. Easy to push such a thin name about.

  154. 154
    Zorgnak Says:

    Pot’s Boiling

  155. 155
    crysball Says:

    EGY recent strength on NO News

    Historically EGY has only had coverage from 2 analysts
    ~Berman, Stephen of Pritchard Capital Partners, LLC
    ~Mariani, Leo of RBC Capital Markets, and one of those [Steve Berman] downgraded them after the Q3 CC.

    In late January a Botique Investment Banker Brokerage named MLV & Co added coverage. In reserarching MLV & Co they appear to have access to private wealth and run book on some small cap E&P placements [Bonds & Stocks].

    IMHO Vaalco mgmt.possibly gave them access to some as yet not disclosed information [partner for Angola Block 5, well results on 2nd GW Well, etc. ]……and they have been pushing it to their clients.

    We should find out shortly, when the presentation for the Enetercom conference [Feb. 21-23] is posted next week.

  156. 156
    zman Says:

    re 154 – thanks for posting, had not seen that one. Trouble bubbling indeed.

  157. 157
    snuhart Says:

    re 153 thank you

  158. 158
    zman Says:

    re 157 – sure, I have noted some of the IPs in the Banks area of late that they were getting drilled by BEXP, turned STO, were pretty good, seems like 3 or 4 weeks back. Still not going to be played by me again.

  159. 159
    Zorgnak Says:

    FTK closed that volume gap to 10.55 I mentioned Sunday. Looks in better shape nto me now.

  160. 160
    ram Says:

    Peace BondBuddha, will miss you calling in from your bedside.

  161. 161
    skibbi9 Says:

    @154,156 Saudi,

    I don’t think this is all that new. Saudi security/defense is well trained/well equiped and well paid. This unrest isn’t particularly new nor does it seem to be a big issue. The saudis will put them down

    I think that article is a bit sensationalist. Not that I agree with all their governance, I just think they’re in a different position than the rest of the “arab spring” nations.

    Middle east will continue to be a tension catalyst though. Iraq’s power problems (both electrical and politic) will creep up and be issues. Kurdish seperation will be an issue, and we haven’t even gotten to the rest of the region.

  162. 162
    zman Says:

    Agree re different than Arab Spring, but I don’t recall security forces drawing fire in recent memory, maybe I missed it.

    Africa too re tension catalyst. Nigeria and Sudan troubling at present.

  163. 163
    skibbi9 Says:

    Fully expect civil unrest to be another big topic this year.

    Greece and Spain will be the hot points in Europe. Expect more issues in Russia with elections upcoming and unrest last year to pickup once the ground thaws. Figure Chinese unrest will continue to be held at bay, not sure how N.K. responds this year.

    Depending on the economy and FX, India may start seeing unrest as well.

    Egypt and Syria will continue to be hot points in the middle east… even Turkey seems to have issue.

    Deciding whether too book the honeymoon to Greece this summer or put that trip off for a couple years

  164. 164
    zman Says:

    Ah the internet


  165. 165
    RB Says:

    Samson has posted a new “advisory” to its website…the Defender stuff looked better than I expected…comments on the other two wells I’ll save for Z…above my pay grade

  166. 166
    zman Says:

    SSN operations update

    Defender. That’s positive, would like to see more time on it but moving in right direction.

    Gretel II. Good comments there too. We like Dolomites.

    Australia II. Fraccing now, could be done by Friday.

    More comments in the morning post.

  167. 167
    zman Says:

    Cramer – the way he presents it, he just discovered MHR.

  168. 168
    zman Says:

    Jim is absolutely wrong about saying MHR is in better properties than BEXP was. He says he had to redo his thinking when BEXP was taken out because he couldn’t believe MHR was so cheap and didn’t get that kind of valuation. Wow, that’s not even on the mark at all. End of rant.

  169. 169
    Dillon Says:

    Cramer thinks Gary created and built Cimarrex! He is kinda humorous haha

  170. 170
    crysball Says:

    The Atlantic Mirror Image…in W. Africa

    Following is a data room slide prestation from the Sonangol / Vaalco Block 5 in shallow offshore Angola.


    Note slide 5 shows a Brazil Analogue on the left side of the slide.

    Looking forward to the Vaalco presentation at Enercom next week.

  171. 171
    Zorgnak Says:

    Interesting O/N session with Moody’s downgrade causing a gap
    down open in the S&P and Euro futures. Crude barely took notice of the event. Looking at the O/N Euro chart it appears that the Moody grade was leaked ahead of the release. The S&P has recovered to test the 1352 level once again. Crude has rallied to new highs for the
    O/N session. Crude near resistance at 102 with support now at 100. Acceptance below at 100.

  172. 172
    Zorgnak Says:


  173. 173
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