Wrap – Week Ended 3/22/13

We were on vacation much of last week and our stocks took the week off as well, choosing to pause / fall more than the benchmarks, both inside and outside of the ZLT Top 10. This seems to be normal stock behavior for when we go on vacation ... or maybe more likely, it's just that Ides of March time of year.  We'll incorporate wrap comments into the Monday post; have fun watching all the ball games.

17 Responses to “Wrap – Week Ended 3/22/13”

  1. 1
    zman Says:

    Be our 2,000th follow on Seeking Alpha:


  2. 2
    zman Says:

    And don't forget to follow us on Twitter:


  3. 3
    brodway Says:

    didn't see CHK mentioned in your recent gas review. are there too many moving parts in the company to be able to provide meaningful analysis?

  4. 4
    crysball Says:

    re:: NTI  and the FERC  Rejection  of the  Sandpiper  Pipeline [Clearbrook  to  Wisconsin].
    In the  recent   CC   NTI    mentioned  they  have  a  planned  Maintenace    shut  down   in  April to  complete  the  expansion  of  their  refinery [adding  approx  10%  throughput  or  8,000+ BOPD] by  modifying  their  #1 hydrocracker [which  runs only Bakken  light]. They  also  indicated  that  in  addition  to  their  own  pipeline  from  Clearbrook,  and  their  barge  terminal on the Mississippi,   they  are  actively  expanding  their   truck  fleet  for  Baaken Crude.   They   indicate  that  much  of Baaken  oil  is  being   trucked [to  railhead terminals]  and  they  can  achieve   both  optionality  and  cost  control by  using  the  trucking  option…..i.e.  they  load at  the  well  tank farm  and  get  best pricing.

  5. 5
    zman Says:

    Doing some site maintenance, will get to 3 and 4 in a bit. 

  6. 6
    zman Says:

    re 3 – we got asked about CHK on the Friday post. We've not owned the name in quite some time now and I don't  think I'm a big value add there. This was my response on Friday:


    Re 18 – yes but too many moving pieces for my liking. I think (CHK)  they still need another $3 to $4 B in asset sales this year to fund their gap.  Little doubt they get it done but don't know what company looks like on the other side of that in terms of EBITDA generation/volume growth/ mix. Also, too much drama. SEC investigation of Aubrey underway. I don't know if that stops at the man or expands to the company.

    Anyway, it may all work out well for them but I 'm a simple guy and like

    1) V x P = R – (LOE+P TAX+G&A) = EBITDA.

    2) Then EBITDA – INT EXP + CASH + Avail Liquidity = +/- CAPEX.

    R = my thoughts on gas prices with hedges in mind x V.

    Volumes pretty controllable via capex.

    Costs come down or go flat via higher volumes.  

    So EBITDA per unit either expands or goes flat (but near term expands with all of the names right now on a per unit basis due to price (and it goes without saying that estimates for 1H13 are about to really get marked to market by the Street as we hit quarter end).  Note that Street Consensus is at $3.45 / MMBTU now and the front 3 months are just over $4 as can be seen here:


    With CHK a lot of the above is a puzzle too big for me to bother with, but again, best wishes to those guys and happy distressed asset sales to some of my guys. 

  7. 7
    zman Says:

    re 4 – Interesting and thanks. It's hard to fathom that trucking would be cheaper than piped volumes. It's generally the other way around. 

  8. 8
    zman Says:

    New and Improved How To ZEB page


  9. 9
    gdr Says:

    Interesting How To ZEB page. There are quite a few very knowledgable posters on the site, many of whom seem to have a deep understanding of the energy space, some with extensive work experience. 
    To the extent that it's possible maintaining anonymity, can you highlight the backgrounds of the key members? I know you did that a few yrs back.  Can it be updated?

  10. 10
    zman Says:

    re 9 – yes, will work on that this week.  

  11. 11
    Zorgnak Says:

    XLE Trading above support (77.68) on positive demand volume in all time frames.
    XOP Low volume pullback to support levels. (60.20 /59.75). Demand volume remains supportive.

  12. 12
    zman Says:

    Re 11 – thanks Zorg

  13. 13
    Zorgnak Says:

    Crude Oil Futures 
    Finding a home here at 93 with short term consensus/acceptance building. Demand volume supportive of higher tests with 96.25 resistance.

  14. 14
    Zorgnak Says:

    #13  you are welcome
    S&P Futs…setting up for a move here, with demand volume, breadth and POMO positive. A move above 1555.75 clears recent range

  15. 15
    zman Says:

    SDCJF on the tape saying Netherland Sewell upped the company's PV10 from $47.9 mm to $159.5 mm, don't have details just a headline but that's a lot bigger than the simple addition of taking in the Texon properties. 

  16. 16
    milepost_43 Says:

    Cyprus…MARKETWATCH says deal done……….. — Futures showing +70 open…..

    SYDNEY (MarketWatch) — Cyprus and its institutional lenders have reached a bailout deal, according to reports citing European Union officials. As part of the agreement the country will impose a 40% haircut on Bank of Cyprus depositors holding more than 100,000 euros ($129,760) in their accounts, Agence France Presse reported. The deal will now be put to the Eurogroup in Brussels for approval, the reports said. The weekend saw tense meetings between Cyprus and the Troika — the European Commission, the European Central Bank and the International Monetary Fund — to reach a deal before a Monday evening funding deadline.

  17. 17
    zman Says:

    re 16 Futures are pleased:


    Savers in Cyprus not so much. 

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