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Robert Rapier  

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  • Why You Shouldn't Buy Oasis [View article]
    Oasis is just one of the more leveraged players, and they are going to react strongly to changes in oil prices. Look at what happened on the way down. I think investors are counting on more upward moves in WTI, because Oasis still won't be profitable at the current price. But speaking historically, a 10-20% upward move in WTI is probably going to translate into a 20-50% upward move in OAS.
    Oct 6, 2015. 04:22 PM | 1 Like Like |Link to Comment
  • Why You Shouldn't Buy Oasis [View article]
    Update us if you cover. I am curious about your strategy here. I agree with others that being short Oasis after such a deep decline was very risky. I presume you have an exit strategy. If you were counting on $20 oil to exit your position, I don't think you are going to see that. In fact, I think we are much more likely to revert to ~$60 over the next year.
    Oct 6, 2015. 02:27 PM | 1 Like Like |Link to Comment
  • Avoid ConocoPhillips As Cash Flow Issues Persist [View article]
    This isn't their first rodeo. They have been through lots of these business cycles. I was there as an employee during some of them.

    I am conducting an analysis of free cash flow (FCF) improvements of the various oil and gas companies last quarter relative to the past 12 months. Practically every oil and gas company has been FCF negative for the past year, but in Q2 COP made the biggest move by far in the direction of positive FCF. If a move of that magnitude could be pulled off again in Q3 they would turn FCF positive. Doubtful, but they are heading in the right direction.
    Aug 13, 2015. 01:22 AM | 2 Likes Like |Link to Comment
  • Noble-Rosetta Deal: A Harbinger Of The Upstream Consolidation Wave? [View article]
    OK, thanks. I just wanted to make sure I wasn't missing something. I have been using the Standardized Measure to compare companies since the PV-10 can be prone to some sleight of hand. Noting of course that the commodity prices today are much lower than those used in the year-end SM calculations.
    May 13, 2015. 06:13 PM | 1 Like Like |Link to Comment
  • Noble-Rosetta Deal: A Harbinger Of The Upstream Consolidation Wave? [View article]
    "The best "apples to apples" metric would be the SEC-10. For Rosetta, it was ~$1.75 bn at year-end 2014."

    I see $2.6 billion as their Standardized Measure of Discounted Future Net Cash Flows in their 10K. What is the $1.75 billion in reference to?
    May 13, 2015. 05:23 PM | 1 Like Like |Link to Comment
  • U.S. Crude Oil Storage Capacity: There's More Available Than You Might Think [View article]
    Michael, my article on the storage situation was published last night. I tried to make sure mine made points that were distinct from yours, but our conclusion is the same. We aren't running out of storage:
    Mar 10, 2015. 08:27 PM | Likes Like |Link to Comment
  • U.S. Crude Oil Storage Capacity: There's More Available Than You Might Think [View article]
    There are also 2 other factors in play. Demand has been picking up in response to low prices. Sales of SUVs and big trucks are up. This is also turnaround season for refiners; 6 months from now they will be running a million more bpd than they are now.

    Second, the EIA expects the budget cuts to begin impacting production in Q3. It is going to be tight for a bit, but these things are self-correcting. No way the price collapses like some have suggested.
    Mar 6, 2015. 11:26 AM | 1 Like Like |Link to Comment
  • U.S. Crude Oil Storage Capacity: There's More Available Than You Might Think [View article]
    Yeah, I have since also seen the Zeits piece. I need to come up with my own spin on this, but that graphic is really informative. I think I still have to include it.
    Mar 5, 2015. 05:59 PM | Likes Like |Link to Comment
  • U.S. Crude Oil Storage Capacity: There's More Available Than You Might Think [View article]
    I am not Michael, but I have a theory. I think they just don't realize how much storage is available. So they hear things like "Storage at an 80 year high" and they think we must be nearly full. Then, others hear it and repeat it. If you look at the graph of Cushing storage, it does look ominous relative to history. But the maximum capacity isn't indicated on that graphic.
    Mar 5, 2015. 04:38 PM | 2 Likes Like |Link to Comment
  • U.S. Crude Oil Storage Capacity: There's More Available Than You Might Think [View article]
    Damn it man! I am working on this same article. No kidding. I was just looking this week at all the articles that suggest we are running out of storage, and I said "I have to debunk this." So I started writing an article on this same topic yesterday that I should have up for my next column. I used that exact same EIA graphic.
    Mar 5, 2015. 04:24 PM | 2 Likes Like |Link to Comment
  • ConocoPhillips' Nonexistent FCF Is A Problem For The Dividend [View article]
    The article references the pre-PSX years a couple of times. "The company used to make $15 billion in profits but has posted declining profits each year since 2011." Yes, $15 billion before PSX was spun off. To not know that, or to know it and not note it -- in either case doesn't reflect well on the article.

    Also, if I was in COP's shoes and oil was trading at $100/bbl, you bet I would be plowing all I could back into the company. This is a mistake so many people make that try to analyze these companies. They are making investments that will pay off for years, and when oil prices get really high they increase their investments. When oil prices crash, they slash their investments and then they will continue to benefit from the investments they made previously.
    Mar 5, 2015. 03:46 PM | Likes Like |Link to Comment
  • EOG Resources Not Interested In Race To The Bottom [View article]
    I follow only a handful of people here who I feel like really understand this space. Casey is one of them. You aren't going to be right all the time. Nobody is. But he provides extremely valuable insights into the energy sector.
    Feb 25, 2015. 11:27 AM | 2 Likes Like |Link to Comment
  • Keystone would "significantly" boost oil sands emissions, EPA says [View news story]
    The stupidity of the EPA's comments is mind-boggling: "the incremental greenhouse gas emissions from the extraction, transport, refining and use of the 830,000 barrels per day of oils sands crude that could be transported by the proposed Project at full capacity would result in an additional 1.3 to 27.4 million metric tons of carbon dioxide equivalents (MMTC02-e) per year compared to the reference crudes. To put that in perspective, 27.4 MMTC02 per year is equivalent to the annual greenhouse gas emissions from 5.7 million passenger vehicles or 7.8 coal fired power plants."

    So, not only does their letter presume that if the pipeline isn't built then 830,000 bpd simply won't be consumed (a ludicrous assumption), the EPA and environmental groups then fixate on the highest estimate in a range that spans 1.3 to 27.4 million tons of carbon dioxide per year. That's not an honest, objective assessment.

    In reality, unless demand falls or cheaper sources of oil are developed, that 830,000 bpd will find its way to market via alternate routes that are more carbon-intensive than pipelines, actually increasing the carbon emissions by not building the pipeline. The only real way to avoid the emissions entirely is to reduce demand, in which case the pipeline wouldn't even be needed and we wouldn't have to worry about misguided attempts to stop it.

    Oh, and about that high end estimate of the equivalent of 7.8 coal-fired power plants? There are 1,200 of those being built right now around the world. Note how much airtime that gets relative to Keystone XL. Our priorities are so out of whack.
    Feb 3, 2015. 05:41 PM | 7 Likes Like |Link to Comment
  • KiOR files for bankruptcy, but not Mississippi unit [View news story]
    KiOR's bankruptcy this year was one of the 5 predictions I made for 2014. I had people telling me I was wrong right up until last night. But who will invest with Khosla again? Hey, I asked that question after the Range Fuels debacle. The guy is clearly a good salesman, even though he knows nothing about biofuels.
    Nov 10, 2014. 02:35 PM | Likes Like |Link to Comment
  • Viper Energy's Venom Less Lethal, But Not Harmless [View article]
    Good article. I wrote one just before the IPO, and we warned people away because we thought the downside risk was took high then. But it's certainly worth some attention now, as are many of the higher risk energy companies.
    Oct 31, 2014. 11:19 AM | Likes Like |Link to Comment