23
Mar
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.
Be our 2,000th follow on Seeking Alpha:
http://seekingalpha.com/author/steve-zachritz
March 23rd, 2013 at 9:19 amAnd don't forget to follow us on Twitter:
https://twitter.com/ZmansEnrgyBrain
March 23rd, 2013 at 9:19 amdidn'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?
March 23rd, 2013 at 9:34 amre:: NTI and the FERC Rejection of the Sandpiper Pipeline [Clearbrook to Wisconsin].
March 23rd, 2013 at 9:55 amIn 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.
Doing some site maintenance, will get to 3 and 4 in a bit.
March 23rd, 2013 at 11:54 amre 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:
http://www.barchart.com/commodityfutures/Natural_Gas_Futures/NG?search=NG*
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.
March 23rd, 2013 at 1:52 pmre 4 – Interesting and thanks. It's hard to fathom that trucking would be cheaper than piped volumes. It's generally the other way around.
March 23rd, 2013 at 1:54 pmNew and Improved How To ZEB page
http://zmansenergybrain.com/letter-from-z/
March 23rd, 2013 at 1:54 pmInteresting 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.
March 24th, 2013 at 5:40 amTo 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?
re 9 – yes, will work on that this week.
March 24th, 2013 at 1:43 pm
March 24th, 2013 at 4:39 pmXLE Trading above support (77.68) on positive demand volume in all time frames.
http://www.charthub.com/images/2013/03/24/Stock_Weekly_2_1303241323.png
XOP Low volume pullback to support levels. (60.20 /59.75). Demand volume remains supportive.
http://www.charthub.com/images/2013/03/24/Stock_Weekly_2_1303241314.png
Re 11 – thanks Zorg
March 24th, 2013 at 4:45 pmCrude Oil Futures
March 24th, 2013 at 6:13 pmFinding a home here at 93 with short term consensus/acceptance building. Demand volume supportive of higher tests with 96.25 resistance.
http://www.charthub.com/images/2013/03/24/Crude_Composite_1303241611.png
#13 you are welcome
March 24th, 2013 at 6:20 pmS&P Futs…setting up for a move here, with demand volume, breadth and POMO positive. A move above 1555.75 clears recent range
http://www.charthub.com/images/2013/03/24/Es_Composite_2_1303241618.png
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.
March 24th, 2013 at 6:35 pmCyprus…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.
March 24th, 2013 at 8:53 pmre 16 Futures are pleased:
http://www.cx-portal.com/wti/oil_en.html
Savers in Cyprus not so much.
March 24th, 2013 at 9:07 pm