03
Nov

Thursday Morning – Earnings Tsunami

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Market Sentiment Watch: Energyland probably a bit over done to the downside as are both oil and natural gas. In today's post please find the oil inventory slide show, the natural gas storage inventory preview, comments on nine names that we either own or are interested in otherwise that reported last night and this morning.  Please note that our comments today may be less verbose (more bullet point-ish) than usual due to time constraints.  Please see our call plan for the day at the top of the Stuff section.  

 

Ecodata Watch:

  • We get Jobless Claims at 8:30 am EST (F = 260,000, last read was 258,000), 
  • We get Productivity at 8:30 am EST (F = 2.3%, last read was -0.6%), 
  • We get Unit Labor Costs at 8:30 am EST (F = 1.1%, last read was 4.3%),
  • We get Markit Services PMI at 9:45 am EST (no forecast, last read was 52.3),
  • We get ISM nonmanufacturing at 10 am EST (F = 55.7%, last read was 57.1%),
  • We get factory orders at 10 am EST (F = 0.1%, last read was 0.2%). 

In Today’s Post:

  1. Holdings Watch
  2. Commodity Watc​h
  3. Oil Inventory Review 
  4. Stuff We Care About Today - LPI, GPOR, PE, CRZO, RICE, WPX, CPE, CLR,  PDCE (just announced, section in progress)
  5. Odds & Ends

Click the link directly below this to ... .

Holdings Watch:   

ZLT

  • Yesterday's Trades: None
  • The Blotter is updated.

Commodity Watch:

Crude oil closed off $1.33 yesterday at $45.34 on after EIA reported a greatly imports influenced massive build in crude stocks, strong gasoline demand and bigger than expected and as expected drops in gasoline and distillate stocks respectively. Please see the slide show below for details. This morning crude is trading close to $47.75.

Natural gas closed down $0.11 at $2.79, continuing the recent string of weak trading sessions and near the low end of our expected pre storage peak range. This is the expected weakness we have been looking for the shoulder and nothing more. Maybe a bit sharper due to the warmth but injections are being helped in the South Atlantic region by air conditioning load and the forecast is starting to turn, if slowly. We see this as short term noise and not a reason to be concerned about our $3 2017 average price expectation for 2017. This morning gas is trading off slightly. 

 

Natural Gas Storage Preview

Street is at +57 Bcf for tomorrow's report. 

  • Last Week: +73 Bcf
  • Last Year: +56 Bcf
  • 5 Year Average: +57 Bcf
  • 10 Year High: +91 Bcf
  • 10 Year Low:  -7 Bcf

Oil Inventory Review

exp vs act 102816

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EIA 102816 A

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EIA 102816 B

Stuff We Care About Today

Today's CC Schedule (all times EST)

calls 110316

LPI Reported Bigger Than Expected Record 3Q16 Volumes and EBITDA; More Well Above Type Curve Earth Model Driven Wells; Increased Guidance Again. 

LPI 3Q16

Guidance:

  • 2016 Capex: No change vs prior guidance of $420 mm (3 rig program), 
  • 4Q16 volume guidance of 51.1 to 53.3 MBOEpd vs current Street of 49.1 MBOEpd
  • 2016 Volumes: Increase from prior 7% growth to new 10% growth YoY. We note that at the beginning of the year, they were guiding to a 4% contraction.
  • 2017 Capex: Not yet
  • 2017 Volumes: Not yet

Highlights:

  • Completed 10 wells in the quarter with 7 of those completed late in the quarter, 7 of them > 10K' laterals, and 9 of the wells with big 2,400 #/ft fracs ... later in the quarter and larger completions are going to help with that 4Q guidance,
  • 3 wells with bigger completions and enough data in the quarter tracking 40% over type curve in the Cline, 61% over cuve in the Upper Wolfcamp and 40% over in the Middle Wolfcamp.
  • We had on the catalyst list expectations that type curve exceedence would rise above prior 30+% levels of 1H16,

Balance Sheet: Solid

  • Borrowing base reaffirmed,
  • Net debt to annualized 3Q16 EBITDA of 2.8x
  • Liquidity of $755 mm with an undrawn revolver. 

 

Nutshell: Big beat on volumes and costs. They're making a habit out of bagging the Street we think. And the raise, while not unanticipated by us is welcome, especially in light of no increase to spending and in light of where they began the year. The Earth Model driven program is hard to argue with and while it's not as oily as we like we are noting a modest increase in sequential EBITDA per BOE despite flattish oil prices from 2Q to 3Q as unit costs contract. Wells continue to get bigger with bigger fracs and estimates should rise for 2016 and 2017 EBITDA here. We continue to own a a small position in LPI in the ZLT. 

PE Reported 3Q16 Beat and Raise; Wolfcamp B Locations Boltstered, Again Highlights Bigger Future Potential, Borrowing Base Increased

PE 3Q16

Guidance:

  • 2016 Capex: Unchanged. A fifth rig has been added and they are contemplating adding another in 2017
  • 2016 Volumes: Increased to 37 to 39 MBOEpd (up 73% YoY) vs prior of 36 to 38 MBOEpd (up 68% YoY),
  • Lowering LOE guidance to $4.50 on mid for 2016 (and we note a minor increase in cash G&A per BOE),
  • 2017 Capex and Volume: Not yet official. Street expecting 46% growth now.  PE saying to expect lateral lengths to grow from 7K' this year to 8K' next. 

Highlights:

  • Wolfcamp B - second zone made official - 450 net locations added to Midland Basin inventory (increases the WC B location count by 85%) . slide 5 in today's presentation shows increasing thickness that allowed this in the WC A /B as you look at wells in the north in Martin (500' combined thickness) down to wells in Midland County (500 to 700' thick) to Upton and Reagan Counties where PE is focused and the thickness is in the 800 to 900' thickness range.  
  • 15 Upper WC B wells so far are exceeding the 1 MMBOE type curve (tracking very close to Lower WC B performance).  Newest wells drilled since mid 2015 are beating the curve by 17% (northern Upton and western Reagan). 
  • Stacked Test - Grace Pad in NE Upton - first stacked pad of WC A, Upper WC B, Lower B - exceeding expectations. Includes a WC Upper B that's second best 24 hour IP in company history ... early time data shows tracking to 1 MMBOE curve. 
  • Those 3 zones will still have 200 to 250' of vertical separation each and in some places the WC A may support a second zone (which would increase locations again as in those thickest spots they'd have 4 benches in the two WC zones).
  • Testing four zones 2017.
  • And they'll test tight spacing via stagger stack and stagger tests and ultimately a downspaced U and L WC B test in late 2017.  
  • What does this mean?   It means they could go from 8 wells per section in each of the 3 zones now (Lower WC A, Upper B and Lower B) for a total of 24 wells to adding the Upper WC A and tighter spacing in each to 15 wells per section for a total 60 wells per section. 
  • Midland Basin 3Q IP30's per 1,000' at 176 BOEpd vs 171 in 2Q,
  • Bigger sand load making bigger wells in the Midland Basin Lower Spraberry program,
  • Delaware - still limited number of wells in the play for them but their South Delaware Wolfcamp wells are easily exceeding the 1 MM BOE curve,
  • Delaware - noted their first operated well from spud to TD to completion IP'd over 2,000 BOEpd in Reeves (this is the western acreage) and then a 2 well pad on the east side in Pecos, with bigger fracs, had an IP 30 of 1,517 BOEpd (75% oil) or 194 BOEpdIP/1,000'. So good so far. Through the first 60 days, these wells are far exceeding the original Trees State well. We note this pad appears to be on the leases they bought mineral rights for earlier this year, further increasing economics of the project. 
  • Commented that well level returns match those of $85 oil two years ago. 

Balance Sheet:

  • Borrowing base increased from $475 mm to $900 mm with company electing to hold to $600 mm
  • Liquidity: $801 MM including undrawn $600 mm facility and cash. 
  • Net debt to 3Q16 annualized EBITDA: ~1.95x (pro forma Glasscock acquisition)

Nutshell: Nice beat and raise quarter with best in clase YoY and sequential growth posted this quarter for a Permian. Nice inventory add on existing acreage. Guidance all good.  

 CRZO Reports 3Q16 Beat; Increasing Volume Guidance, Nice Operations Update

CRZO 3Q16

Guidance:

  • 2016 Capex: Increased to a range of $400 to $410 mm vs prior of $395 mm (1 to 2 rig EFS program with minimal completions in the Delaware Basin) ... increase brings forward planned 2017 infrastructure spending in the Delaware Basin. 
  • 2016 Volumes: Increased to a range of 41.5 to 41.9 MBOEpd (-vs prior guidance of 40.75 MBOEpd (up 11%),
  • 2017 Program: Not yet official but previously they'd noted an ability to drive 10 to 30% on a 2 to 4 rig program,

Highlights:

  • Eagle Ford - Oil production up 2% sequentially, noting many of the quarter's 14.9 net well adds were brought on late in the quarter,
  • Eagle Ford - at quarter end, they had 23.8 net wells waiting on completion (they are one of the few to show their thoughts on WOC wells and this add they put at 8,900 bopd (oil only listed)), 
  • Eagle Ford - Six stagger stack pilots underway testing spacing from 165 to 280'. The tightest and oldest (online over a year now), Brown Trust pad, is doing well enough (volumes on trend with offset wider spaced wells) to prompt them to go into development mode at that spacing in the area - there alone this adds 50 to 55 net wells (up 75%). Expect more of these kinds of spacing derived locations adds in coming quarters. 
  • Eagle Ford - tighter stage spacing resulting in 15% uplift on first 15 wells attempted (sees more than justifying the incremental $200K) and is moving forward with 200' stage spacing vs 240' on future wells for a total 6,200' lateral completed cost of $4.1 mm (same cost as before given efficiency gains and service cost reductions) ... nice, 
  • Delaware Basin - two more IPs announced (respectable but not sexy rates, and lower oil cuts as expected), adjacent to prior well (east side) and on the western side of their county line acreage (Culberson / Reeves ) and plans to spud two more wells in 4Q16 (this moves the well count from 4 operated wells this year from prior 3),
  • DJ Basin - They note a 20 to 30% uplift in their non op program due to well design improvements and are now changing their operated design (moving to cemented liners, 185' stage spacing, 1,110#/ft sand vs sleeves, 285 ' stage spacing, and 750#/ft). 
  • DJ Basin - They note five new operated wells they brought on late in the quarter used the new design and are now above the company curve. Short lateral well costs less than $2.7 mm with the new design. 
  • DJ Basin - Differential to be $2 off Nymex vs historic $10 / barrel due to recently negotiated contracts, saying this takes the play down to sub $40 economics.  

Balance Sheet:

  • Borrowing base unchanged at $600 mm 
  • Liquidity: ~ $505 mm pro forma recently announced Eagle Ford bolt on. 
  • Net debt to 3Q16 annualized EBITDA: 3.4x

Nutshell: Beat on stronger than expected production and lower than expected operating costs. The raise announced this morning is small and the focus on the call should be on further defining the preliminary 2017 outlook (we think they will be overwhelmingly Eagle Ford with a bigger DJ component in 2017 and a slightly bigger Delaware program as well and a push towards the prior top end of the 10 to 30% growth band).  

 RICE Reports 3Q16 Miss On Production Adjustment and Operating Costs; Guidance Increased

RICE 3Q16

The 3Q16 Numbers: 3Q16 volumes are net of a 27 MM/d prior period adjustment related to election to not participate in some Utica acreage. The exit for the quarter was over 800 MM/d. 79% of volumes were transported to favorably priced markets yielding a 45 cent pre hedge differential to Nymex in the quarter.  Unit operating costs rose to $1.28 per Mcfe from $1.13 last quarter and they didn't give good color as to why but LOE and FT were both up sequentially but guidance still shows both lower on the year so look for questions on that.  

Guidance:

  • 2016 Capex: No change to prior $735 mm but spuds increased from 62 to 73 and expected Turn In Lines (TILs) moves up 1 to 61. 
  • 2016 Volumes: Increased to a range of 780 to 800 MM/d vs prior 765 MM/d (up 39% including Vantage partial 4Q contribution)
  • 2017 Capex: No change to prior planned spend $1,213 mm on mid.  In the presentation they noted that $565 mm of the budget is for strong growth in 2018. Without that spending, they would still churn out the 70% growth noted below in 2017,
  • 2017 Volumes: No change vs prior range of 1.28 to 1.36 Bcfepd (includes inorganic impact from full year of Vantage at 0.38 to 0.4 Bcfgpd), with an inorganic growth rate of 72%. 

Highlights:

  • 6 rigs running now (4 Marcellus, just went to 2 in Utica)
  • Marcellus completed well costs at $720 per lateral foot.  Taking guidance for full year down from prior $850 per foot to $800 as average for 2016. This compares to $1,218 per foot in 2015. 
  • Marcellus - No new wells were turned to sales during the quarter as per plan (production holding up well). 
  • Utica completed well costs at $1,100 per lateral foot; reduced 2016 guidance by $25 to $1,250 per foot.  This compares to $1,715 per foot in 2015. 
  • RICE Marcellus and Utica wells continue to rank in the levels of all industry wells drilled based on cumulative production.
  • 110%+ IRRs pre hedge at strip. 

Balance Sheet:

  • Credit facility increased from $875 mm to $1.0 B,
  • Liquidity: $1.3 B pro forma Vantage acquisition and not consolidated with RMH and RMP.
  • Net debt to TTM EBITDA: 1.7x unconsolidated with a projection of 2.0x by YE16.  

Nutshell: Noisy quarter and the miss will likely hurt them near term. They continue to grow rapidly, work to achieve to lower capital costs and better differentials while maintaining a strong balance sheet. The quarters operating costs will need to be addressed on the call.  

 WPX Report 3Q16 Volume Beat / EBITDA "Miss" Despite Good Costs; Guides to Strong Oil Growth Next Two Years

WPX 3Q16

The 3Q16 Numbers: The Street wanted too much from the quarter in terms of EBITDA and we suspect an outlier there dragged the average well high of reason. EBITDA was up 22% sequentially on a 1% decline in volumes and better operating costs. 

Guidance:

  • 2016 Volumes: 82 to 87 MBOEpd vs prior mid point of 79.5 MBOEpd,
  • 2017 Capex: Initiated $800 to $860 mm budget (50% to Delaware Basin), 5 irgs Delaware, 2 rigs Williston, 1 rig San Juan, 
  • 2017 Volumes:  97 to 107 MBOEpd (up 21% over 2016 mid guidance),
  • 2017 oil growth of 25% (upper end of prior loose guidance band),
  • 2017 operating costs (LOE, GP&T, and P Taxes) of $9 to $10.50 per BOE (vs $9.58 /BOE this quarter)
  • Oil growth of 50% in 2018 funded via cash and cash flow with no incremental debt. 
  • On these cases they see EBITDA expanding to just under $600 mm (in line with Street) in 2017 and then nearly $1.2 B in 2018 (well north of Street).

Highlights:

Delaware Basin  (production 56% oil and at 28.3 MBOEpd, up 9% sequentially)

  • 1st WC A-X/Y- IP of 1,812 BOEpd (70% oil) - short lateral, 
  • 1st WC D wells (lower oil cuts in Loving and Eddy Counties with high pressure) - big area of prospectivity but hard to get excited about that mix (it was as expected).
  • They're working a couple spacing tests in the U and L WC A (330' in both) and (660' lateral spacing in the L WC A) ... no data yet, probably on the 1Q17 call.  
  • ROR on Delaware long laterals at > 100%, WC A at > 80%

Williston Basin (85% oil)

  • Began completing DUCs in August,
  • Announced a number of solid IPs from 3 mile laterals (we like to see more longer rates than they generally) with 9 mm # fracs and from 2 mile laterals with 6 mm pound fracs.
  • They put wells at 70+ % IRRs here (presumably at strip).
  • All areas in 2017 expected to see longer laterals except the Williston Basin where they will trend back toward 2 milers.  

San Juan Basin

  • West Lybrook Pad - 60 days cumulative production of 365,000 BOE (70% oil) from 6 wells (or about 1,000 BOEpd per well)
  • The Lybrook wells are significantly better than prior results due to steering, landing, size of frac and they plan to add another rig here in 2017. 

Balance Sheet:

  • Liquidity:  $165 B with a reaffirmed borrowing base of 1.025 B.
  • Net debt to 3Q16 annualized EBITDA of 4.2x with a target of 2.5x by YE18

Nutshell: The quarterly results are noise relative to the positive operations update and increasingly stout guides.   We continue to see the name as moderately cheap on 2017 EBITDA, overtly cheap on 2018 EBITDA, but still overlooked because of the leverage and mixed focus of plays. The longer term program to focus on the Delaware should start to wake the Street up to the cheapness by mid 2017 assuming prices between here and our assumed $55 average oil price next year.  

CPE Reports In Line 3Q16 Results; Raised 2016 guidance to 60% YoY Growth ... Points to Big Growth by 2018

CPE 3Q16

Guidance:

  • 2016 Capex: Unchanged vs prior guidance of $140 mm,
  • 2016 Volumes: Increased from prior 14.5 to 15.5 MBOEpd range (up 56% on mid) to new range of 15.25 to 15.550 MBOEpd range (up 60% on mid) 
  • 2017 Capex: Not yet. Prior guidance was that they expected to be running 1 to 2 rigs at Wildhorse and in the Monarch area each and as much as 1 rig at Ranger.  With this release they now see adding the 3rd rig early in 2017 and a 4th rig in 2H17.  
  • 2017 Volumes: Not given vs prior guidance of 18.5 MBOEpd, our expectation that the guidance would grow to 22 MBOEpd and vs current Street of 21.7 MBOEpd. 
  • 2018 Volumes: 30,000 BOEpd on a $50 oil case with free cash flow by mid 2018 vs prior of 22.5 MBOEpd (which was obviously too low).  Street is now at 28 MBOEpd. 

Highlights:

  • They have an average of 1.6 rigs running in the quarter and focused on the LS in the Monarch area (see prior cheat sheets)
  • Howard County - WildHorse area, Silver City well, a previously announced WC A well that was an acquired DUC and the first one they completed after the acquisition and employed the newer completion design, with an IP 30 of a whopping 292 BOepd/1,000'; now at 192,000 BOE (89% oil) in first 110 days (big well). This well is way off the map over type curve (80% over curve); followed by drilling a 2 well pad (WC A and LS) to offset, results next quarter.   Noted lower transport costs coming due to pipeline hookups in 1H and 2H17. 
  • Monarch area (Pecan Acres field) - noted a WC A - adds a fifth zone to the area, on a pad with a two LS wells. Cleaning up, next call for data, tied in in early 4Q.  Cabo Field - Also tied into sale their first 13-well spacing per section test (effective) with a 3 well pad in early 4Q16 (color on call but encouraged). Carpe Diem - completing their 2 longest wells to date (11,500'). 
  • Reagan County - Ranger Area, completed two acquired DUCs, bigger fracs at 2,000#/ft, still cleaning up but encouraged (Color on call) in the WC A and B. 

Balance Sheet:

  • Liquidity: Nearly $500 mm.  Nothing drawn. 
  • Net debt to 3Q16 annualized EBITDA: 1.7x (ex preferred)

Nutshell: Solid quarter on record high volumes and stronger relative pre hedge differentials for both oil and natural gas. Some big well results and more delineation to come across it's legacy and new acreage. Strong guidance.  

Other Stuff

GPOR (unowned) Reports OK/As Expected 3Q16 Results

  • Production of 734.1 MMcfepd (pre announced up 13% YoY and up 10% seq.) vs 731 MMcfepd expected,
  • EBITDA of $94.7 mm vs $96 mm expected,
  • Good cost control, YOY reductions in LOE, gathering/processing, and G&A to total of $1.08 / Mcfe
  • EPS of $0.16 vs $0.10 expected
  • 4Q guidance of 765 to 790 MM/d (Street at 775 MM/d currently), with full year guidance unchanged. 
  • No formal 2017 yet but continues to think along lines of a 6 to 8 rig program (they have 4 now and 2 more are set to arrive prior to year end).
  • Conference Call: Today, 9 am EST.

CLR (unowned) Reports 3Q16 Miss; Inches Up Guidance

  • Production of 207.84 MBOEpd vs 209.2 MBOEpd expected; Bakken ebbed as expected, Southern region hit new record (STACK and SCOOP driving it higher),
  • EBITDA of $387 mm vs $421 mm expected
  • EPS of ($0.22) vs ($0.15) expected
  • Guidance increased from 210 to 220 MBOEpd to 215 to 220 MBOEpd,
  • Capex boosted to $1.1 B vs $920 mm prior.
  • They've started working down their Williston Basin DUC inventory,
  • STACK - announced density pilot - first one in over-pressured area - noted IPs of 2,653 per well from the Meramec (4 upper, 4 middle  with 9,700 laterals), noted the discovery well here has been on for 338 days for cumulative volumes of 298,000 BOE (74% oil) and is still doing 815 BOEpd which is monster.  Made a point of noting the last 7 wells were $7.8 mm CWC vs the original one at $11.1 mm.   Puts IRRs at > 100% at $50/$3. They're talking three Meramec zones and the Woodford and looking to develop on 4 wells per zone per section spacing. 
  • They note costs continue to fall for long laterals in STACK. 
  • We watch this one for developments that may impact thinking for NFX.
  • Conference Call: Today, 12 pm EST.

PDCE - Announced Late - In progress

3Q16 Volumes Based Beat, Good Costs - still reading ....

PDCE 3Q16

Section in progress ....

Quick highlights:

DJ Basin

  • Wattenberg field production up 13% sequentially to  61.8 BOEpd (95% of total)
  • First eight long laterals turned to sales during 3Q, early days but flow back in line with expectations
  • Wattenberg differential at $4.27 / barrel (improved)

Delaware Basin

  • Expects to close in December
  • Seller running 2 rigs now (they'd said this would be the case by year end) and a long and short lateral have been drilled since acquisition announcement.
  • Production of 7,500 BOEpd up modestly since acquisition announced in August (then 7,000 BOEpd),

Balance Sheet & Other 

  • Pro forma Permian acquisition liquidity of $1 B; borrowing base reaffirmed at $700 mm (with $450 mm commitment levelunitl December at which time upon acquisition close it goes to the full amount, currently undrawn), 
  • LOE at $2.33 per BOE, down from $2.63 last quarter.

Odds & Ends

Analyst Watch:

  • TBA

116 Responses to “Thursday Morning – Earnings Tsunami”

  1. 1
    zman Says:

    All times EST

    LPI Thursday, 8:30 am live  
    GPOR Thursday, 9 am replay/transcript
    PE Thursday, 9 am live  
    RICE Thursday, 10 am replay  
    WPX Thursday, 10 am  replay  
    CPE Thursday, 10 am live  
    CRZO Thursday, 11 am live  
    PDCE Thursday, 11 am replay  
    CLR Thursday, 12 pm replay/transcript
  2. 2
    zman Says:

    Partial PDCE added to post … in progress, getting on LPI call, notes in a bit … 

  3. 3
    zman Says:

    LPI about to start, presentation here:

    http://www.laredopetro.com/investor-relations/events-and-presentations/corporate-presentations.aspx

  4. 4
    zman Says:

    LPI 3Q16 Notes

    Highlighted the big change from start of year to current guidance

    Continue to refine earth model, sounds more quickly than in past

    Capital efficiencies allowed them to add rig #4 without increasing their budget (it does come on in mid November so not going to be a big $ add anyway, jumpstarts 2017)

    Noting the 40 and 61% over type curve in two wells (type curve beat walking up almost quarterly) – when raise EUR?

    Reducing water handling costs via their midstream 

    69% of oil production transported via pipe – up from 44% a year ago – 

    Sees this going to 80% of oil next year as new wells along production corridors are added

    Reaffirmed borrowing base 

    Liquidity of $755 mm

    Respect to remain under 4x debt/EBITDA

    Target 75% of expected oil production hedges for a 12 to 18 month rolling period  (hedges at ~ $56 floors in 2017 and 2018 (adding now))

    Going to Q&A 15 minutes in … 

     

     

     

  5. 5
    zman Says:

    LPI 3Q16 Q&A

    Morning guys, outstanding quarter

    Q) pleasant surprise how good the wells look despite what looks like a tighter choke than peers

    A) 24 hr IP and 30 day rates are not our focus. We're trying to make sure the flow backs are safe for the wells (just want to keep the sand in the wings) … seeing some outstanding early results

    Q) Longer laterals, some greater than 13K'

    A) our acreage allows us to do that and longer. That last couple of thousand feet of lateral is pretty cheap and we can complete that toe area effectively (which used to be more of a concern). 

    Q) Goldman ? – Cline Shale  (Wolfcamp D) – why is that return improving more

    A) better AFEs through more efficient drill times, have done a lot of earth model work to land the Cline laterals better and then optimize the completions better. 

    Q) how difficult to frac that toe in the 13K' laterals 

    A) we've done it successfully, lot of planning, early indications are that we are completing those very very very successfully. It has not been an issue to get that done with slickwater. The corridors help with the management of that much water. Just not having issues with the toe in these. 

    Not seeing cost issues being a near term issue for them. 

    PE call to start in 5 minutes, will switch over then … 

     

     

     

  6. 6
    zman Says:

    LPI saying Street still not really getting the value of the Earth Model and production corridor combo vs what others do. Pretty standard quarterly statement. Not that it's not true. 

  7. 7
    zman Says:

    LPI call actually ended 27 minutes in, very positive tone, short and sweet. 

  8. 8
    PackMan Says:

    Zman – Did you cover WPX earnings ?  I was looking but did not see any commentary … maybe I missed it.

  9. 9
    zman Says:

    re 8 – yes, third from bottom today's post. 

  10. 10
    zman Says:

    PE call starting, notes in a bit … 

  11. 11
    zman Says:

    PE presentation here:

    http://www.parsleyenergy.com/investor-relations/events-and-presentations/events-2016.aspx

  12. 12
    zman Says:

    PE 3Q16 Notes

    Once again we packed a year's worth of growth into one quarter, up 20% seq… I sound like a broken record. 

    Oil was up even more. 

    Growth was efficient, 

    Raising guidance again to 72% YoY on mid

    Still running below $5 mm per well for a 7,500' lateral despite enhanced frac

    Midland Basin: 

       Noting the big WC B upgrade – please see the upside comments in the post 24 wells per section now (as they add the second zone in the Wolfcamp B) and over the next year could go to 60 wells were section (from just the Wolfcamp A and B). 

       Our WC A/B complex is among the thickest you will find in the Permian

       Exceeding the 1,000,000 boe type curve as noted in the post

       How well do they perform when completed together ?  Answer: Good, tracking ahead.  Noting the WC B well in that test was the 2nd highest WC B 30 day IP so far (not staggered but direct stack)

       Noting the coming tests of upper WC A (bench 4 in the complex)

       NPV of $3 to $5 mm per location …. so those 450 net locations noted in post could equal up $2 B in NPV  (like finding a plan in your own back yard) – and again, that's the add from adding one more bench and not the idea of downspacing or a fourth bench

    That's how you hold a CC … 

     

  13. 13
    zman Says:

    PE 3Q16 Notes 2

    Operations update

      Lower Spraberry – noting new long lateral well cumulative is 4x that of an earlier short lateral well at same point in time. 

     "Monster Frac" well – the Kathryn well – 8% over analogue wells first 3 months

    Delaware

     As noted in post, Delaware basin results even better than the WC stuff noted above

      West side – First drilled well, the Lincoln well – is tracking over 2,000 BOEpd at the 30 day mark

      East side – two well pad noted in post, drilled opposite direction, so no benefit of stress shadowing, but well above the original Trees Ranch well here. 

  14. 14
    zman Says:

    PE 3Q16 Notes 3

     – noting the big 89% increase in borrowing base

     – $600 mm commitment level is company elected level and undrawn

     – $800 mm liquidity

    4Q16 will see a lot of shut ins for offset fracs so don't expect big seq rise, sets up strong start to 2017.  Probably setting up a 4Q beat here. 

    Look for questions re 2017 growth at this point. 

    Going to Q&A 19 minutes in … 

     

  15. 15
    PackMan Says:

    9 – Thanks.  Somehow I missed that.

  16. 16
    zman Says:

    re 15 – no problemo.

  17. 17
    zman Says:

    PE 3Q16 Q&A

    Q) M&A environment

    A) pretty frothy – $30 to $40K per acre Midland, high in Delaware too.

    Q)  2017 activity levels and planning

    A) Focus is likely 6 rigs. Started the 5th earlier than expected. Returns are tremendous at current prices. We're staffing up in advance of more rigs in 2018. 

    Q) Delaware

    A) Pretty comfortable with those well results; will see us ramp swiftly there. 

    Q) Grace Pad – the 3 stacked wells in NE Upton – can talk about the other wells, some above or below line there

    A) don't have the 30 day rates yet, but the two lower wells are getting the benefits of the stress shadowing, 

    Q) WC A in 2017 plans – second landing zone – similar to how you did in WC B

    A) Use the same game plan – be methodical, use learning results of second zone in B

    "thank you, lot of good stuff in the quarter"

    Q) 60 wells per section concept implies what kind of recovery

    A) great question, on a per section basis we have 100 to 130 mm bo OOIP – gets up to 17 to 22% recovery (that's a big number but still a lot of oil in place)  … often companies are going after the first 8 to 10% in primary recovery so this is what the higher density laterals get you.
     

    We have 15 years of inventory with a 10 rig count

     

     

  18. 18
    zman Says:

    PE 3Q16 Q&A 2

    Q) service cost inflation

    A) we're approaching the bottom. Unit costs are stabilizing. We think about 60% of cost reduction since 2014 are efficiency based.  Seeing some steel costs rising but still offseting some of that on lower cycle times. 

    Good morning guys and congrats on another impressive quarter. 

    Q) the location adds seem like a game changer … does this take you out of M&A

    A) No. It helps us prove the value of the acreage, maybe a little less inclline, kind of a mixed answer

    Q) Glasscock 

    A) 170 BOEpd /1,000' trending, right in line with corporate average.  Will be more testing in 2017. Wells so far there not leading edge completion design so that's next.

    Q) pipeline capacity ?

    A) good from both sub basins.   Midstream projects everywhere, midstream companies banging on the door, asking to do new projects. 

    Q) Other zones in the Delaware. 

    A) We've seen 10 discrete targets within a close radius.  Encouraging 2nd Bone results near us. Don't see the price / acre is unjustifiable given the potential. 

    Q) Bias M&A between Midland and Delaware

    A) Would like to see prices roll over a bit, a bit heated, will stay plugged in and we'll bid but don't see us winning big packages at the higher prices, will look for contiguous locations. 

    Q) Midland Basin – how thick Spraberry

    A) About 2,000' thick (top of Spraberry to top of Dean above the Wolfcamp zone)

      – peers saying maybe 3 zones in the Lower Spraberry ?

       We plan to test that, will do over the years (just not a focus near term)

    Q) 4Q16 shut in ?

    A) for reference had 1,500 boepd shut in for offset completions in 3Q

    October average of 46,000 BOEpd (with some presumably down) – that's well above the 43 MBOEpd 3Q average but said will take a big pad down for offset fracs in December.  Smells like a beat coming again but either way it's timing, good to see that October rate. 

    Q) pilot questions

    A) plan to do a stagger stack 330' Upper / Lower WC A – can't say timing yet.   There will be a direct stack Upper Lower WC A later in the year. 

  19. 19
    zman Says:

    LPI up 14%, leading of pack today.  Note the long term base there, nearing top of that zone. 

  20. 20
    zman Says:

    CPE call in 10 minutes. 

  21. 21
    brodway Says:

    WPX not far behind the leader pack

  22. 22
    zman Says:

    PE 3Q16 Notes

    Q) tighter spacing and EUR

    A) would expect some degradation when you go below 330' lateral spacing

    Q) completion testing

    A) In Midland Basin – have been testing one change in a number of wells, will push that best of breed combo in 2017

    In Delaware – have jumped quickly to the bigger fracs 

    Q) Pad development – wells per pad in 2017

    A) 3 wells

    Q) A&d market prices

    A) think its at the top, giving or take a bit. Kind of in shock unless you are a gas company coming into transform to an oily Permian company

    Very positive call continues, about to switch to CPE … 

  23. 23
    zman Says:

    re 21 – yeah, longer term guidance really helping the name, getting oilier faster than expected, plus now growing from that smaller base. If anyone can be on that call please feel free to relay some notes. 

  24. 24
    zman Says:

    Anticipating a good call from CPE. 

  25. 25
    brodway Says:

    at some point FSLR will simply be too cheap….not sure where that is….sold out at 40 took a loss a few weeks back….may be looking for re-entry shortly.

    Nrgyman if you'd like to chime in, commentary would be useful 

  26. 26
    zman Says:

    One more PE question and answer. 

    Q) when do you get the degradation in the tighter spacing EUR reduction – first year production or later

    A) said it's disproportionately weigthed to the out years …. so even if you get a 20% reduction, as they stated you got with verticals that got tight to each other, that means the NPV impact of that reduction would be small as much of it is late in the well's life, discounted back in time over many years.  Nice. 

    CPE about to begin … 

  27. 27
    Baylor Says:

    Z & co – do y'all see NG drop as over done to the downside?

  28. 28
    zman Says:

    CPE 3Q16 Notes

     – have doubled acreage over last year to > 40,000 net

    – will exit this year > 20,000 BOEpd

     – 2nd hz rig running now, came back in August after being stacked in Feb… same crew, came back well with driling of their two longest wells yet (both 11.5K'). 

     – 3rd rig early 2017; 4th rig 2H17

     – 2017 – sees outspend handled by current balance sheet cash on a $47.50 price

     – sees spending within cash flow iby mid 2018 on $50. 

    – keeping debt/ebitda < 2x

    Noted the WC A stacked tests were with RSPP.   Someday combo of those two a possibility. 

    Silver City Wolfcamp A well update (Wildhorse area) – says this is the most asked question he gets – 192,000 boe in 4 months. Off the chart vs type curve. Will revisit type curve after next several wells

      – about to complete 3 Silver City offset wells – a WC A stacked with two LS wells now – slide 11

      – drilling another 3 well pad to the south in Wildhorse

    13 wells per section test – slide 12 and 13 – looking good

    Slide 15 – shows infrastructure plan to keep same level of operating efficiency on new assets (WildHorse – Howard county)

    Slide 20 – long term guidance 

     2017 –  22 to 24 MBOEpd (76% oil) – Street now at 21.7 MBOEpd

     2018 –  29 to 31 MBOEpd (79% oil) – Street now at 28 MBOepd

    So about 40% growth 

    LOE up on acquired fields. Expect infrastructure improvements to address this over the next couple of quarters. 

    Going to Q&A  20 minutes in … 

  29. 29
    zman Says:

    NG inventories in 10 minutes

    NG off a penny

    http://www.investing.com/commodities/natural-gas

     

  30. 30
    zman Says:

    Natural Gas Inventory Quick 

    +54 Bcf – slightly better than expected

    We now have 3,963 Bcf in storage

    1.2% over YoY

    4.6% over 5 year average. 

  31. 31
    zman Says:

    Post inventories, NG holding the bottom of our near term expected range

    http://www.investing.com/commodities/natural-gas

  32. 32
    zman Says:

    ZTRADE – ZLT – CPE – Trading

    CPE – Added a Trading position in CPE at just under $13.08 in the wake of the 3Q16 results, guidance upgrade with 40% growth after this year's 60% number through 2018. Conference call ongoing.  Please see today's post for additional color 

  33. 33
    brodway Says:

    re: 32

    odd response to good CPE earnings 

  34. 34
    zman Says:

    re 33 – yeah, not odd for this 3Q reporting period and see overall group pull back since the open. 

  35. 35
    RB Says:

    OT General Market

    The SP broke down out a descending triangle.  The measured move target is 2047, which corresponds to a thick volume of support I have marked with a blue dotted line (lowest of two blue dotted lines)

    I am also watching the breadth closely, as measured by the % of stocks in the SPX holding above their 200 day averages.  We are threatening the BREXIT lows at the moment and as NRGY and I have pointed out fear and panic is near levels where things have bottomed.

    So the charts say it could and should go lower, the sentiment which is equally important says, yeah but not by much.

    https://stockcharts.com/h-sc/ui?s=%24SPX&p=D&yr=2&mn=0&dy=0&id=p36954684592&a=476782358

     

  36. 36
    zman Says:

    Adding to that re CPE – You also have group leader PXD extending yesterday's drop and you've got oil since the open backing. It's group related malaise, which is why we opted to add again having added just under $13 last week. 

  37. 37
    zman Says:

    re 35 – hear ya bottom, thanks much. 

  38. 38
    zman Says:

    CPE 3Q16 Notes

    Q) well density

    A) 11 wells per section at present, very encouraged by the effective 13 wells per section test. 

    Q) why not add rig 4 earlier

    A) gotta get facility work done in advance, don't want to be overly inefficient. 

    Q) net completions count in 2017 and 2018

    A) cycle time continues to compress. Expect more reduction from Howard.  Right now 15 to 16 days to drill, couple weeks to get spread on 2 to 3 weeks to frac, then clean up. 

    17 wells per rig year at Monarch and will come down to that at Howard

    Q) Howard County

    A) just getting started, just drilled first two wells offsetting Silver City, a lot of infrastructure work and spend to do. 

    Total midstream spend in 2017 is $50 to $60 mm of the budget vs about $40 mm in 2016; then probably $30 to $40 mm in 2018.  We like to set up a new area for the long term. 

    Q) well costs

    A) have not changed AFEs yet but expect it given the big ramp in rigs in the Midland and Delaware Basins. 

    FANG is near us at Sidewinder (where Silver City well is) 

    Ranger – has delivered exceptional well results, competes well for capital now, it's HBP'd, as long as uplift on the newer other areas holds up then will go back there with newer completion designs. 

    Q) Howard County

    A) getting excited to test the WC B (FANG success last quarer)

    Q) Wunderlich analyst question regarding costs – anything that can stop you from growing

    A) "like I said, we're myopically focused on infrastructure … once we get that in place there's nothing to stop us from drilling and completing focus"

    This was an attempt by Wunderlich to support a their thesis on inflation (30% in 2017) they espoused last week. Nice try but gotta say nothing on the calls to date this quarter has come close to confirming that kind of expected hike.

    Call ended, positive tone.  Analysts sounding a bit tired. 

  39. 39
    zman Says:

    CLR (unowned) getting docked for the miss. 

  40. 40
    RB Says:

    I wasn't happy to see the trend line break on WTI.  My next target down is in the 43.25-43.50 range noted by a lime green dotted line. (ugly isn't it?)

    Likewise I'm not happy to see the XOP, plotted in the lower pane, take out its Sept. low.  The next pivot low is a good distance away at 32.69.  We need a bounce here to make the XOP look more constructive.

    But with sentiment where it is, it isn't unlikely we get the mother of all bounces as soon as we reconcile ourselves that the world will not end if we elect either of these two President.  Us peons will still toil away trying to make better lives for ourselves and we will survive 'em.

    Not a lot of thought on individual names.  I'm still working through the estate planning with the lawyers and accountants.  The Family travels so damn much they hardly do their part and the lawyers and accountants are all busy as hell this time of year two.  Looks like a grumpy holiday season here in FW.

    Here's my WTI/XOP chart….https://stockcharts.com/h-sc/ui?s=%24WTIC&p=D&yr=1&mn=0&dy=0&id=p83416228699&a=468080911

     

  41. 41
    zman Says:

    Gassy stocks treading water to down post inventories.

    NG up two pennies. 

     

  42. 42
    zman Says:

    re 40 – the Pirate Party in Iceland looking more interesting by the day. 

    CRZO call in 7 minutes. 

  43. 43
    brodway Says:

    re: 35

    RB….your note closely reinforces my general S&P view poster earlier this week……2000-2050 being the middle of the range over an extended period of time….i still think 2079 the 50dma may act as support should it get there

    On Brexit….Sterling acting much better vs. dollar over last week….

  44. 44
    zman Says:

    re 43 – word of needing to confirm with Parliament pre actual Brexit may be helping. 

  45. 45
    tomdavis12 Says:

    CPE Z  Seemed to me there was some weakness when they were discussing their $50mm infrastructure spend. Does that seem high to you? Once that spending is done it would seem they have clear sailing if pricing allows.

  46. 46
    zman Says:

    re 45 – I saw that on the minute chart (I generally have one up during calls) but noted it also lays down nicely with the move in the XOP at the time. 

    As to the $50 mm, It's up a bit but not really a big variance. Not a concern by me at least. I'd rather they build for thoughts of 2-3 years out and not on a shorter basis anyway.  As is, infrastructure is more of a governor on their rig adds than G&G understanding. 

    CRZO about to start, notes in a bit. 

  47. 47
    zman Says:

    CPE and XOP – tick for tick on the minute chart

  48. 48
    zman Says:

    LPI over a buck off morning highs. 

  49. 49
    james T Says:

    re 40 –   I think option expire is November 18,  so we get thru the election,  and wed before options exp.   could be a point where things recover or not .   We have a Nov 11 government shutdown threat as usual with a vote on Nov 5th I believe.  This may have been taken care of, correct me if I am wrong.   Plus the Election,  (more like a circus)

     

  50. 50
    tomdavis12 Says:

    CPE  Z What is your rough EV/EBITDA for '17 with stock at $13.

  51. 51
    Justin Says:

    NOG- Does an element of optionality make NOG interesting?  Considering the Rowling and Akradi influence,Tudor Pikering engagement, 2020 maturities, incredible price decline, etc…

  52. 52
    zman Says:

    re 50 – ~ 8.6x

    re 51 – not sure I follow. 

  53. 53
    zman Says:

    CRZO 3Q15 Notes

    Planning 3rd rig add in 2017,

    Said 20% growth in 2017 with formal plan in coming months  (this is middle of prior range)

    LOE to be up in 4Q with acquired properties impacting, can bring down in time

    Operations update – largely reading the release

    Going to Q&A 19 minutes in … 

     

  54. 54
    brodway Says:

    weak WTI not helping matters…..Nat Gas however seemed to find a bottom at 2.73 (very close to the late October low) this morning and is attempting a bounce….

  55. 55
    james T Says:

    Nice,  No comments necessary why cant people just do things right.

     

    In the two weeks prior, the EIA reported import numbers into the U.S. Gulf coast that were significantly below the Customs totals. For the week ending October 14, EIA imports into PADD 3 were 550,000 barrels per day below the Customs number, and 116,000 bpd below for the week ending October 21. 
     

  56. 56
    zman Says:

    CRZO 3Q16 Q&A

    Q) refracs

    A) may be better to just drill wells around it vs refracs. Same question and answer each quarter

    Q) Infrastructure spend in Delaware

    A) It says we are drilling more wells than planned due to better results. We are putting infrastructure in now as we have a good idea of what production is going to be like. 

    Q) DJ Basin completion overhaul

    A) The biggest increase came from conversion to the slick water. Likened it to the Austin Chalk wells back in the day, trying to complete more complexity. 

    Q) Delaware wells – what are completions now. 

    A) we are transitioning to as much slickwater as possible, stayed at 2,000 #/ft.  Next we'll take the cluster spacing from 240' down to 200' or 180' next. Trying to drain more uniformly down the lateral and not way out from the lateral (so may not see them jam more sand in soon). 

    7,500' Delaware are $7.5 mm going to to $6.5 mm in development mode, which would make it very competitive with their core EFS. 

    Q) DJ Basin – any operated capex next year?

    A) still analyzing that – will have NBL and WLL non op. 

       Noting NBL drilled an excellent Codell well further south into CRZO's acreage and he nots they have same Codell thickness on 80% of their acreage

      Really sounds like the moving pieces of their budget are very much in flux at the moment.

    Q) Delaware prices

    A) We have pulled back on some of the deals based on high prices.  Not giving up, trying to do bolt ons and farmouts.

    Q) Brown Trust – 10 to 15% smaller EUR on tighter space

    A)  factored into guidance

    Q) regional capex allocation

    A) running model as if all capex goes to EFS.  Then breaking it down by economics with $ to Delaware and then non op Niobrara

    Q) More EFS M&A

    A) We're open to bigger packages. More likely to big on oil vs gas … we're still fairly bearish on gas but if the economics are right we'll bid on it. 

    Q) Where next Delaware Basin drilling

    A) Drilling a WC A well on the west.  Noted a good WC B well just south their acreage. WC C was done to the west by COP a few years ago (very gassy) but it is thick, then the WC D is there but also very gassy. 

    I thnk the Delaware for them is more of an interesting hobby to go slow on. They remain my favorite Eagle Ford play. 

    Call ending

    Tone quiet, positive but quiet. 

    Will be trying for replays in a few minutes on a couple of calls. 

     

  57. 57
    zman Says:

    re 55 – it happens. This is in line with our thoughts at the top of the Oil Inventory review section. 

  58. 58
    james T Says:

    re57 your much too kind,

  59. 59
    nrgyman Says:

    CRZO–did they comment on the recent acquisition from SN?  

  60. 60
    nrgyman Says:

    FMSA:  Q3 report.  Vols up 24% seq. and Revs up 18% seq.  Still burning cash, but less so.  

    http://finance.yahoo.com/news/fairmount-santrol-announces-third-quarter-103000949.html;_ylt=AwrSbg_0VRtY3QgAMAxXNyoA;_ylu=X3oDMTEyYnM2Mzk1BGNvbG8DZ3ExBHBvcwMyBHZ0aWQDQjI4MjJfMQRzZWMDc2M-

  61. 61
    zman Says:

    re 58 – I used to talk with a couple of different areas of EIA on a monthly basis. It happens. 

    re 59 – they mentioned it, yes. It's a bolt on. Would do bigger ones if they could get economics they like. Didn't specifically talk about wells there other than to say they saw room for improvement (unless I fell asleep and missed it)

     

  62. 62
    zman Says:

    re 60 – thanks. 

    Getting on CLR (unowned) call now. 

  63. 63
    pac10jd Says:

    Did I miss news on WPX?  up 15%…

  64. 64
    zman Says:

    CLR (unowned) 3Q16

    Outlining milestones for quarter

    Negative probably overdone here but thought it was overdone to the upside anyway

    Milestones

    1) noted a number of strong Woodford wells in STACK, normally they talk up the Meramec  but highlighting this extra value

    2) big DUC backlog built while working on completion design.  Two recent 30 day rates best in their history and now completing DUCs with the newer designs

    3) strong production from SCOOP Woodford oil window density test

    $) debt reduction – plan to get it down to $6 B

    Macro View

      Rebalancing in progress.

      OPEC back to negotiating. 

      See recovery ahead

       See slow steady growth in supply and demand

       Regardless of OPEC at end of November, see fundamentals back in charge, with US making OPEC less relevant. 

    ….

  65. 65
    zman Says:

    re 63 – Please see third to last section of post. 

  66. 66
    nrgyman Says:

    Do you see the recent swoon in crude prices increasing the likelihood that OPEC reaches an agreement to control production?  Pressure building?

  67. 67
    zman Says:

    re 66 – it seems to help when prices are off their highs, yes.  I don't see it as 100% but think the chances are bit better than the media/analyst crowd seems to be thinking at the moment. 

  68. 68
    zman Says:

    CLR – we do have 3 zones across our acreage in the Meramec.  On average, they expect to have 2 in any one spacing unit. 

  69. 69
    brodway Says:

    OPEC leaders have generally voiced what they are going to do and stuck to their guns….at least since 2014

  70. 70
    brodway Says:

    WTI continues to come off…..$44 3/8…..way oversold now with $43 (an area RB mentioned as next support level) not far away

  71. 71
    zman Says:

    Very good analyst tone on the CLR call

  72. 72
    nrgyman Says:

    Fear and Greed Index continues to fall–now at 15 (Extreme Fear).  Vix moved to a new leg high near 21.  SPY is now trading in the gap left from July 7.  While the SPY set a new leg low, XOP is still above yesterday's lows even as crude set a leg low today and is trading around $44.50.  

  73. 73
    zman Says:

    re 72 – thanks. Broad market and crude suffering from same worry over next week. Agree with RB comments above re bottoming and bouncing. 

  74. 74
    nrgyman Says:

    MTDR:  any nits the market is picking from the Q3 report?

  75. 75
    brodway Says:

    S&P now within 10 points of the 50dma

  76. 76
    brodway Says:

    FSLR attempting to find bottom

     

  77. 77
    zman Says:

    re 74 – the increase in capex relative to production guidance most likely, nothing about the report gave me trouble. 

    This was my headline yesterday

    MTDR Reports Big 3Q16 Beat; Increasing Guidance;  Borrowing Base Increased 33%; Street 2017 Likely Too Low.

    A quick look at my email today

    – Stephens echoing same, noting the capex up 35%, the FY16 up 3%.  They note the increase in capex is for 2017 footing as they should. 

    – RBC – strong fin'l and ops quarter, again exceeding exp, says well perf positions for 20+% pro gro in coming years. 

    To me it's weak hand selling in a weak tape with oil reinforcing spinelessness. This too shall pass. 

  78. 78
    nrgyman Says:

    RE 77:  Thanks.  Looks like a Buying opp. Now at the 200 dma, but lows still above yesterday's low.  

  79. 79
    nrgyman Says:

    DVN:  DVN's Q3 well results look impressive.  20 wells completed in Q3 with an average 30 day IP of 2000 boe per well.  Mostly STACK.  Are there any oil shale producers with a new 20 well IP-30 avg that high?  How did the NFX and CLR well results in the STACK compare?

    http://finance.yahoo.com/news/devon-energy-reports-third-quarter-201500431.html

  80. 80
    zman Says:

    re 78 – agreed. We added some pre call at about $1.70 so a little under a buck over here. It's shaping nicely, their wells are good, the balance sheet is fine. The outspend can be complained about and the capex hike I get but that's short sited my view. 

  81. 81
    zman Says:

    re 79 – CLR is largely more westerly in the play relative to NFX

    NFX are oilier 

    CLR has a habit of reporting 24 hr IPs and they are two stream so it's a bit of muddle to compare them, also lateral lengths not same so tough to make them apples to apples with what I've got. 

    On the 24 hour IPs, the CLR's are higher but that's normal in gassier well. 

    Both are doing nicely from what I see.  NFX showing a bit flatter early time declines that expected.  Where they overlap they look pretty similar. 

  82. 82
    zman Says:

    re 79 – re 20 well IP at 2000 BOEpd per well. Depends what mix and what lateral length. 

  83. 83
    nrgyman Says:

    RE 81-82:  Thanks.  Can see why the STACK is generating excitement, even if it is somewhat gassier than oil peer basins.

  84. 84
    james T Says:

    DJ – OPEC Optimistic on oil output deal by end of November

    http://www.investorvillage.com/groups.asp?mb=19168&mn=58075&pt=msg&mid=16528424

  85. 85
    zman Says:

    re 83 – it varies in pressure and mix across the play as well. Just like a BOE is not a BOE is not a BOE, the same for STACK applies. CLR shows STACK overpressured at about 70% ROR now, and STACK oil (normally pressured at about 25% and STACK wet gas below that. 

  86. 86
    zman Says:

    re 84 – right, I pointed this out Monday and Tuesday. Glad to see Dow Jones take notice. 

  87. 87
    james T Says:

    re86 Sorry if it was a repost

  88. 88
    zman Says:

    re 87 – not at all, just glad to see others taking note. 

    This was in the Tuesday post:

  89. 89
    zman Says:

    Volatility is, um, elevated. 

  90. 90
    nrgyman Says:

    RE 89:  Yes.  VIX above 21.  BUT, with the major markets and crude oil trading to lower lows today–and still near those lows–the XOP, XLE and OIH etfs not only held above recent lows but are now solidly green.  A bullish divergence.  Needs more confirmation but a positive sign.  

  91. 91
    zman Says:

    CDEV (unowned) on tape saying Nov 10 3Q16 report

  92. 92
    zman Says:

    re 90 – agreed. XOP still broadly within the sideways trade. The upward bias into quarterly results was derailed by outside events that will be over soon enough. 

  93. 93
    tomdavis12 Says:

    Z: Is there an easy way to look at global production figures (OPEC website?). If I wanted to monitor countries with the biggest growth in production as well as those with the largest declines, is there a way? Are some countries figures a work of fiction? 

  94. 94
    zman Says:

    re 93

    – OPEC.org – see the MOMR

    or go to Jodidata.org

      (notable headlines on that site at the moment) – China production at 58 month low, US at 17 month low 

    Re work of fiction, there are always those that exaggerate their volumes; Iran and VZ being the notorious ones on the OPEC front. 

  95. 95
    zman Says:

    re 93 – we also supply that occasionally via graphs on the site; they look at lot like this except for the globe and not just OPEC

    OPEC 12 Production 010616

  96. 96
    zman Says:

    FYI – New sand name coming tonight, SND, have not looked at it. 

  97. 97
    tomdavis12 Says:

    PXD  3.55% turnaround in a lower crude market. hmmm.

  98. 98
    zman Says:

    CPE to HOD

     

  99. 99
    zman Says:

    SND said to be coming "far below" the $15 to $18 expected range.

  100. 100
    zman Says:

    Check out the late day flip in RICE. 

  101. 101
    zman Says:

    After the close we get reports from EOG, ECR, EGN, SYRG

  102. 102
    nrgyman Says:

    SPY just filled the July 7 closing gap.  Decline now moderating.

  103. 103
    zman Says:

    RE 102 -pressure came off group when Nymex closed, even as broad sank. Crude fulfilling some technical points in my view. 

  104. 104
    nrgyman Says:

    SPY with 8th consecutive daily loss.  Longest losing streak since 2008.

  105. 105
    zman Says:

    Beerthirty, back in a bit. 

  106. 106
    nrgyman Says:

    VIX went above 22.5 in the last hour.  F&G index to 13.  

  107. 107
    Wayne G Says:

    NOG melting down. time to sell itself asap

  108. 108
    j Says:

    Energy had lowest implied vol of all sectors today. 

  109. 109
    zman Says:

    re 107 – yeah, reports next week. Their plan seems to be to continue what they've been doing. Chart broke so the extra down today is just technical selling. No plans by me to add. Have said this quarter they need to have a plan of attack or I'm done. 

  110. 110
    zman Says:

    EGN  (unowned) 

    Beat and raise – guidance at 20% per year 2017 to 2019

    2017 guidance assumes cost of new completion design but not the uplift they are seeing. 

     

     

     

  111. 111
    ram Says:

    Zman,  would you consider doing a post mortem chart on all owned E&P's after 3Q earnings and rate them along the lines of meeting, exceeding or lagging in goals/expectations?  Thanks.

  112. 112
    zman Says:

    Is that not what I do continuously through the season and recapped every Monday?   Have you seen the 3Q16 So Far piece? Also comes out weekly. Did you have something different in mind vs the daily updates? 

  113. 113
    zman Says:

    SYRG 3Q16

    EBITDA and EPS beat on pre announced volumes, edging up guidance based on pad timing into year end but that's all noise. Focus on call will be the 2 rig growth program for 2017, and any cost guidance that can be squeezed out of Lynn. For the growth (near 70% next year) and the net debt/EBITDA (just 0.2x now) it seems cheapish at 10x 2017.  No operations update to speak of given the recent one but should be better color on call. 

  114. 114
    ram Says:

    I do monitor the updates and that is fine.  Sorry for the confusion.

  115. 115
    zman Says:

    re 114 – no confusion, help me understand what it would look like and I'll take a look at it. 

  116. 116
    brodway Says:

    Not sure this was posted, S&P tagged the 50dma to almost the exact number this afternoon….now have to see if it rebounds tomorrow and continues to hold up its positive tone

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