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Jennifer Warren  

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  • U.S. Oil Growth Slows: Whither The Fields Of Glory?
    Today, 5:49 AM APA, CHK, DVN 13 Comments

    Summary

    • U.S. basins reveal steepening declines in production growth, from 103,000 barrels per day to 68,000, according to the EIA's recent drilling report.
    • The reduced rig count and capital reductions are finally playing out in production terms.
    • The Eagle Ford and Bakken indicate sharper reductions than the Permian Basin.
  • Texas Oil Producers' Shuffle 2014: Global Oil's Direction?
    Editors' Pick • Thu, Feb. 26 APA, APC, CHK 38 Comments

    Summary

    • Texas' top oil producers have vied for their places in the last three years, and some have left the charts completely while others "placed."
    • Texas producers are a proxy for U.S. oil, and many firms are showing their strengths and weaknesses by their decisions and guidance.
    • The global supply and demand dynamics ahead are not quite as gloomy as the past six months.
  • Occidental Petroleum Escaping The Oil Price Black Hole
    Editors' Pick • Fri, Feb. 6 OXY 83 Comments

    Summary

    • Occidental Petroleum's EOR (enhanced oil recovery) business has escaped the gravitational pull of the black hole of low oil prices.
    • Conservative management and attractive asset choices leave Occidental in a decent position to ride out storms and capture any volatility-related upsides.
    • Oxy will continue to grow production at a reasonable clip, with its Delaware Basin acreage and Al Hosn liquids key contributors.
    • Oxy's production in Texas' prolific Permian Basin totals 15% of total production.
  • Energy Transfer Merger Creates Second Largest MLP, Scale Economies
    Tue, Jan. 27 ETP, ETE, RGP 50 Comments

    Summary

    • The merger between Energy Transfer Partners and Regency Energy Partners is a continuation of the trend in industry consolidation.
    • From a management and operations standpoint, the consolidation of two Energy Transfer family MLPs will provide greater scale and capital efficiencies.
    • The Energy Transfer merger is a sign of the times, with market forces cajoling efficiencies that should reward shareholders.
    • As the U.S. re-pipes itself between states and basins, Energy Transfer's moving, processing and gathering volumes of hydrocarbons is a good play.
  • Post-Saudi Succession, Oil Markets Still Seeking An Elusive Equilibrium
    Editors' Pick • Mon, Jan. 26 APA, COP, CXO 43 Comments

    Summary

    • Following the passing of King Abdullah, the well-planned Saudi succession offered one source of stability to an unpredictable oil market.
    • Saudi Arabia, the stable oil exporter to the world, has challenges ahead both domestically and regionally.
    • While prices are expected to start recovering in the second half of 2015, geopolitical events could provide some added volatility as supply begins tightening.
    • As mentioned before, global oil producers - Yemen, Libya, Russia, and Nigeria - to name a few, are troubled areas and may further add to oil price volatility.
    • Predictably, producers connected to the oil market are responding to price, but the politics of state-owned players and ungoverned states add a layer of less predictable behavior.
  • Matador Resources Throws Its Hat Further Into The New Mexico Permian
    Editors' Pick • Thu, Jan. 22 MTDR 13 Comments

    Summary

    • Through the new acquisition, Matador is expected to hold the largest Delaware Basin acreage position among small and mid-cap publicly-traded energy companies.
    • The HEYCO transaction expands Matador's Permian Basin footprint and offers flexibility, which is very desirable in today's industry environment.
    • Consolidation is underway in the industry and smart players are joining forces, as in the case of the Matador/HEYCO combining of assets.
    • Matador not only added desirable Permian Basin acreage but a legacy of deep Permian expertise through the addition of HEYCO's leadership.
  • U.S. Oil Plays Strength, Prices And Potential
    Editors' Pick • Tue, Jan. 13 COP, CVX, CXO 120 Comments

    Summary

    • U.S. oil production continues to increase, albeit at a slower pace.
    • The Permian Basin continues to increase production at a higher rate than the other two major plays, the Eagle Ford and Bakken.
    • Stock price volatility is moving in tandem with oil price declines, but more nuance is occurring as information about capital investment and production expectations advance.
    • Assume OPEC will not cut production, which will bring sanity to one's outlook.
  • Update: Pioneer's Participation In Condensate Exports, And Mexico?
    Fri, Jan. 9 PXD 27 Comments

    Summary

    • The allowing of condensate exports for all producers is a bonus to a select group of producers when good news has been hard to find.
    • The interim step of condensate exports may further open the door to lifting the crude oil export ban, in which Pioneer is a leading voice.
    • As an Eagle Ford heavy weight (and Permian too), Pioneer's intrinsic value is starting to shine once again.
  • Oil Markets Through The Looking Glass (And Rocks) Of Chevron
    Editors' Pick • Wed, Jan. 7 CVX 74 Comments

    Summary

    • Chevron's assessment of upcoming global supply needs indicate $500 billion is needed annually for decades ahead.
    • The Permian Basin is still trumpeted as having the best rocks for tight oil (shale oil) in North America.
    • While Chevron's stock has dipped less over four years, these last months have hit the spectrum of producers equally hard.
    • Current oil prices will not be sufficient to promote future investment, and thus, the price of oil will rebalance supply.
  • Jennifer Warren Positions For 2015: Finding Energy Innovators And Problem Solvers
    Tue, Jan. 6 GE, HASI, LMT 24 Comments

    Summary

    • In 2015, I will continue to see how the balance of oil and gas-weighted firms plays out.
    • I believe in the approach of investing in the 'sustainable infrastructure' space.
    • A holistic approach is needed to accommodate these demands at the least cost with the highest purpose use of resources.
  • U.S. Oil Tells A Tale Of Futures Past
    Editors' Pick • Dec. 16, 2014 APA, CXO, OXY 93 Comments

    Summary

    • As more information is revealed by time, the U.S. E&P industry increasingly has indicators that are more positive than negative.
    • The latest EIA drilling report shows declines in new drilling permits but also shows the impact of drilling permit changes and production in an earlier price decline environment.
    • The Bakken, Permian Basin, Eagle Ford and Niobrara plays are the most likely areas to hold up under this stress test environment of lower oil prices.
    • Geopolitical risk is still of concern - though markets shrugged it off yesterday, today and even tomorrow may be a different story.
  • Halliburton's Position On The Front Lines Offers Firsthand Insights, Indicators
    Editors' Pick • Dec. 11, 2014 HAL 76 Comments

    Summary

    • Halliburton indicates that the immediate impact of the lower price environment has fallen in the international camp, but North America is next.
    • The company reminds investors about conventional oil production and mature fields as a source of revenue growth moving forward, restating this opportunity again from the 2013 Analyst Day.
    • National oil companies own approximately 73% of the world's reserves, and the power has shifted back to these producers, as witnessed by steeply declining oil prices.
    • In a low-price environment, "there is nowhere to hide." Halliburton offers investors a window into the industry's tectonic shifts.
  • State Of Crude Oil Lacks Color And Form: A Reporting
    Dec. 9, 2014 BP, COP, CVX 36 Comments

    Summary

    • Oil price volatility is at an all-time since 2012.
    • Majors say look at longer term energy fundamentals, in which energy demand growth trumps.
    • Capital expenditures in the fourth quarter 2014 and in 2015 could be significantly less given the large decline in crude oil prices thus far, notes the U.S. Energy Information Administration.
  • Oil Prices Will Rise Based On Fundamentals And Geopolitics
    Editors' Pick • Dec. 5, 2014 APA, OXY, PXD 375 Comments

    Summary

    • Oil prices may bounce around until some order of confidence is restored in the movements of market actors.
    • Geopolitics are the greatest source of volatility ahead.
    • Oil market fundamentals are a better guide than sentiment and market reactions.
    • U.S. shale oil production may be slightly down, but not out, and the case for exports may be strengthening. Other countries want U.S. exports.
  • Saudi And OPEC Move: It's Just Good Business
    Editors' Pick • Dec. 2, 2014 APA, CVX, ECA 75 Comments

    Summary

    • OPEC's decision to hold its production quota steady at 30 million barrels per day is rational.
    • U.S. markets have reacted in a well-known commodity fashion.
    • What actually changed in the world of oil supply and demand between November 26th and December 1st to cause E&P stocks to decline nearly 5% in some cases? Expectations.
  • Energy Transfer's Lake Charles LNG Exports (Analyst Day, Part 2)
    Nov. 25, 2014 ETP, ETE 55 Comments

    Summary

    • Energy Transfer's LNG project continues to be refined and communicated as the mega-project evolves.
    • The LNG project leverages the existing Lake Charles assets owned by Energy Transfer toward higher value added, a smart re-purposing effort that captures the U.S. LNG export trend.
    • In comparison with other U.S. LNG projects, Energy Transfer's LNG project is cost-competitive and even advantaged in a capital sense: brownfield site aspects offer some tailwinds.
  • Energy Transfer: Play-By-Play Paradigm Shift
    Editors' Pick • Nov. 20, 2014 ETP, ETE 46 Comments

    Summary

    • The Analyst Day at Energy Transfer did not disappoint, with attention to detail on the ground and in the presentation room apparent.
    • Across the many U.S. oil and gas plays, Energy Transfer's assets connect and sync up to create value for shareholders and customers.
    • Energy Transfer is unique in its overall geographic diversification, as well as the various ways in which it touches hydrocarbon molecules multiples times.
    • LPG exports, a new Bakken pipeline and LNG exports are just a few growth initiatives on the menu of opportunities in a target-rich oil and gas environment.
  • RSP Permian: A Resilient Small-Cap Permian Player
       • Nov. 19, 2014 RSPP 14 Comments

    Summary

    • Prudent financial and operations management are rewarding RSP Permian shareholders.
    • Being in the right ZIP code helps, but an experienced leader who has weathered booms and busts matters too.
    • Given an acquisitions orientation, the consequences of low oil prices for some E&P firms may provide opportunities for RSP Permian.
  • Encana's Value Drive Also Offers Volumes From Texas Oil Plays
    Nov. 14, 2014 ECA 10 Comments

    Summary

    • Encana continues to highlight its new chapter in the North America energy story, focusing on efficiencies, better margins and cash flow.
    • While seemingly coming from the rear of the industry pack, according to markets past, the best may yet be to come.
    • The addition of a Permian oil position via the Athlon acquisition and the Eagle Ford offers a new foothold into the highest-producing oil plays in the U.S.
  • OPEC's World Oil Outlook And Pivot To Asia
    Editors' Pick • Nov. 12, 2014 CVX, PXD, RSPP 51 Comments

    Summary

    • OPEC published its recent global oil market outlook, which offers a slightly different and instructional viewpoint.
    • OPEC sees its share of crude oil/liquids production reducing in light of increases in U.S. and Canada production.
    • OPEC also indicates a pivot toward Asia, where it sees the greatest demand for its primary exports in the future.
  • Pioneer Defends Its Turf Regardless Of OPEC
    Nov. 7, 2014 PXD 22 Comments

    Summary

    • Pioneer raised $1 billion in a new equity offering designed to scale up infrastructure and cost efficiencies for the long haul.
    • Pioneer's production forecasts have remained largely unchanged.
    • Pioneer's seemingly defensive moves also are really smart offensive maneuvers.
    • The magnitude of the Spraberry/Wolfcamp shale infrastructure build out is compared to that of the Alaskan North Slope efforts.
  • Shale Oil Production Offers Positive Talking Point For Chevron
    Nov. 5, 2014 CVX 18 Comments

    Summary

    • Oil production from the Permian Basin is forecast to be 10% higher than earlier estimates.
    • Chevron, and a very few other Majors, have fared better than most E&P firms in the industry's current malaise.
    • Timed in a conservative manner, technological advances and applying best practices have allowed Chevron to leapfrog other peers.
  • Viper Energy's Venom Less Lethal, But Not Harmless
    Editors' Pick • Oct. 31, 2014 VNOM 4 Comments

    Summary

    • Viper Energy Partners is a mineral rights MLP playing off of the shale revolution's many opportunities.
    • The MLP's unit price was hit hard likely because of its novel approach, underlying drivers and market overreactions.
    • The idea of a mineral rights-based MLP is clever and its development is worth following - and the Midland Basin is the perfect petri dish.
  • Permian Oil And Infrastructure And Al Hosn Gas Are Value Levers For Occidental Petroleum
    Editors' Pick • Oct. 29, 2014 OXY 9 Comments

    Summary

    • The Permian Basin is a major focal point of domestic growth for Occidental Petroleum, one of the largest acreage holders in the Permian.
    • OXY is not afraid to be opportunistic with its balance sheet if oil prices stay in lower ranges.
    • The re-designed OXY is a result of the U.S. shale revolution and the knock-on effects of technological advances.
    • OXY's diversified value proposition is an attractive feature of the stock.
  • Global Oil Markets: There And Back Again
    Editors' Pick • Oct. 23, 2014 HAL, OXY, PXD 37 Comments

    Summary

    • The oil market narrative is changing, with U.S. supply a new protagonist.
    • While U.S. oil supply moderated price volatility in 2013, today it may be helping solidify a new price floor.
    • The impact of future demand growth from non-advanced economies weighs more heavily on supply, demand and price fundamentals than short-term factors.
  • Flowserve's Global Footprint: Dancing With Resource And Infrastructure Trends
       • Oct. 23, 2014 FLS 12 Comments

    Summary

    • Flowserve offers global and sector diversification in locations where growth is occurring.
    • Flowserve's management has shown resilience in the face of economic crises and progressiveness in its targeted sectors.
    • The trends connected to resource efficiency and related technological advances and infrastructure investment bode well for Flowserve.
  • Global Oil Markets Finding A New Groove?
    Editors' Pick • Oct. 16, 2014 BP, USO, OIL 9 Comments

    Summary

    • Saudi Arabia, the oil market swing producer, is presented with challenging decisions ahead.
    • U.S. shale oil production has become a wild card for global market players.
    • Fundamentals of supply and demand drive oil prices, but right now demand seems to be driving.
  • Fundamentals Of Pioneer, The Permian Basin And Oil Prices
    Oct. 15, 2014 PXD 35 Comments

    Summary

    • Leading oil producers continue to see their stocks decline.
    • Fundamentals point to possible market overreaction.
    • Producers are not panicking, just markets.
    • "Holding the fort" may be the best investor strategy, if one is able.
  • Oil Market Karma Reversed?
    Editors' Pick • Oct. 9, 2014 PXD, RSPP, CXO 90 Comments

    Summary

    • Ample U.S. oil production is helping push down WTI prices. Brent crude prices are also weighed down by a well-supplied market.
    • E&P firms have been punished alongside oil price declines, possibly too harshly.
    • Geopolitical risk is not speaking as clearly to oil markets as pre-U.S. oil production.
  • Update: Pioneer Sale Potential In Eagle Ford Is JV Partner's Interest
    Oct. 8, 2014 PXD 8 Comments

    Summary

    • Bloomberg noted Pioneer's willingness to sell Eagle Ford assets for $4-4.5 billion; this news has been corrected to reflect JV partner Reliance's interests, not Pioneer's.
    • Industry oil production and E&P re-organizations are combining for interesting opportunities.
    • Pioneer Eagle Ford production was 47,000 boe p/d in the second quarter, up from 43,000 in the first quarter.*.
  • U.S. Energy Investing: New Actively-Managed MLP ETF Seeks Superior Total Return
    Oct. 8, 2014 AMZA 24 Comments

    Summary

    • The growing master limited partnership (MLP) investment space continues to parallel growing investor interest in real assets.
    • A first actively-managed MLP ETF signifies that novel approaches offer opportunity to access the investment class in more nuanced ways.
    • The U.S. midstream sector is expected to grow, with $346 billion projected in investment in midstream, downstream and energy-related chemicals value chains between 2012 and 2025.*.
  • What Permian Opportunity Did Encana Buy?
    Editors' Pick • Oct. 1, 2014 ECA 22 Comments

    Summary

    • The recently announced Athlon acquisition diversifies Encana's geographic footprint in a premier U.S. basin.
    • The addition of Permian Basin acreage also offers added profitability in the form of a greater oil-weighted portfolio for Encana.
    • While no two Permian pure-plays are the same, some similarities can be compared and contrasted to help investors understand the relative scale of players.