Jul. 3, 2014, 3:20 PM
- A recent surge of low-magnitude earthquakes in Oklahoma probably is the result of the underground disposal of vast quantities of wastewater generated by oil and gas extraction, according to a new study published today in the journal Science.
- The researchers also calculated that four of the highest-volume wells in Oklahoma are capable of triggering ~20% of recent central U.S. quakes, and found that such induced quakes could potentially occur more than 30 km from the well.
- The Cornell geophysics professor who led the study says the results suggest regulators and oil companies should avoid disposing of wastewater near major faults and do a better job monitoring the activity.
- Among energy firms with a significant Oklahoma presence: CHK, CLR, APA, DVN, SD, EOG, MRO, OKE, OKS, GPOR, WPX, WMB, WPZ, LPI, CWEI, NFX, NGL, COG, WLL, NBL, MPO, PQ, XEC.
Jun. 30, 2014, 12:42 PM
- New York’s cities and towns can block fracking within their borders, the state’s highest court rules, upholding the dismissal of lawsuits challenging bans in two small upstate towns.
- The ruling could lead the oil and gas industry to abandon fracking in New York, or it could mean that a patchwork of rules eventually may govern whether exploration can take place across the state; the case also may invigorate local challenges to the practice in states across the U.S.
- Parts of New York sit above the Marcellus Shale, some of whose top producers are: CHK, RRC, RDS.A, RDS.B, TLM, APC, ATLS, COG, CVX, CNX, EQT, EOG, XOM, WPX, XCO, CRZO, SWN.
Jun. 24, 2014, 12:35 PM
- Cabot Oil & Gas (COG -2.3%) is downgraded to Equal Weight from Overweight with a $38 price target, down from $45, at Morgan Stanley, citing wider long-term gas differentials which reflect a more bearish scenario through 2016.
- Due to the uncertainty of COG's differentials and growth, Stanley believes investors will remain on the sidelines until major infrastructure expansions are in sight.
Jun. 2, 2014, 3:31 PM
- Walter Energy (WLT -6.3%) shares aren't helped by the coal producer's statement that new EPA proposals aimed at controlling carbon emissions from U.S. power plants should have no material impact on the company; in fact, WLT is down more than peers: CNX +1.1%, BTU +0.1%, CLD -0.3%, ACI -2.8%, ANR -4.6%.
- Long-term losers also will include electric companies that burn lots of coal - such as American Electric Power (AEP +0.1%), Duke Energy (DUK -0.3%), Southern Co. (SO -0.3%) and NRG Energy (NRG -0.1%) - but stiff regulations have been expected for some time.
- Likely winners include companies that pump natural gas and those that use it as their primary fuel, such as Calpine (CPN +0.3%), and companies that operate nuclear plants that generate little carbon but have been expensive to run, such as Exelon (EXC -1%), hope that their aging plants will become more competitive.
- A reduction in coal-fired capacity would increase utilities' demand for natural gas by 3B-10B cf/day from 22B cf/day now, potential benefiting major natural gas producers like Chesapeake Energy (CHK +2.1%), Cabot Oil & Gas (COG -0.8%) and Range Resources (RRC -0.6%).
- ETFs: XLE, XLU, TAN, ERX, KOL, IDU, VDE, OIH, ERY, FCG, VPU, DIG, GASL, DUG, IYE, GASX, PXJ, FENY, RYE, UPW, FUTY, RYU, FXN, FXU, DDG, SDP
Apr. 24, 2014, 2:29 PM
- Cabot Oil & Gas (COG +5.2%) trades sharply higher, overcoming Q1 results that trailed analyst expectations, as earnings doubled and revenues rose 36% Y/Y to $510M.
- Q1 total production grew 34% Y/Y to 119.9B cfe, driven by higher realized natural gas prices.
- Total per unit costs fell 19% Y/Y to $2.66/Mcfe from $3.29/Mcfe; all operating expense categories fell on a per unit basis except for exploration expense, which was flat, and transportation and gathering, which rose due to slightly higher transportation rates and new transportation agreements in the Marcellus.
- Tightened 2014 production guidance range to 530B-585B cfe from 519B-598B cfe, and 20%-30% output growth in 2015; raises its capital budget to $1.375B-$1.475B amid an increase in rig count and higher activity in the Eagle Ford.
Apr. 24, 2014, 7:38 AM
Apr. 24, 2014, 12:05 AM
- AAL, ABC, AET, ALXN, AMAG, ASPS, AVT, AZN, BC, BHE, BKU, BMS, BTU, CAB, CAJ, CAM, CAT, CCE, CELG, CFX, CLFD, CLI, CMS, CNMD, COG, COR, CRR, CRS, CSH, CWEI, DFT, DGX, DHI, DLPH, DLX, DNKN, DO, DST, EQM, EQT, ETR, FAF, FCX, FNFG, GM, GMT, GPK, GTI, HOT, HP, HSY, IMAX, IVC, JBLU, KKR, LAD, LLY, LSTR, LTM, LUV, MDP, MHO, MJN, MMM, MO, NBL, NDAQ, NLSN, NTCT, NUE, NVS, NYT, ODFL, ORI, OSTK, PAG, PENN, PHM, POT, PTEN, RCL, RS, RTIX, RTN, RYL, SCG, SFE, SIAL, SILC, SIRI, SONS, SQNS, STC, SWK, TKR, TROW, TWC, TWI, UA, UAL, UFS, UPS, USG, UTEK, VDSI, VIVO, VLY, VZ, WCC, WM, WYN, YNDX, ZMH
Apr. 23, 2014, 5:30 PM
- AAL, ABC, AET, ALXN, AMAG, ASPS, AVT, AZN, BC, BHE, BKU, BMS, BTU, CAB, CAJ, CAM, CAT, CCE, CELG, CFX, CLFD, CLI, CMS, CNMD, COG, COR, CRR, CRS, CSH, CWEI, DFT, DGX, DHI, DLPH, DLX, DNKN, DO, DST, EQM, EQT, ETR, FAF, FCX, FNFG, GM, GMT, GPK, GTI, HOT, HP, HSY, IMAX, IVC, JBLU, KKR, LAD, LLY, LSTR, LTM, LUV, MDP, MHO, MJN, MMM, MO, NBL, NDAQ, NLSN, NTCT, NUE, NVS, NYT, ODFL, ORI, OSTK, PAG, PENN, PHM, POT, PTEN, RCL, RS, RTIX, RTN, RYL, SCG, SFE, SIAL, SILC, SIRI, SONS, SQNS, STC, SWK, TKR, TROW, TWC, TWI, UA, UAL, UFS, UPS, USG, UTEK, VDSI, VIVO, VLY, VZ, WCC, WM, WYN, YNDX,ZMH
Apr. 22, 2014, 8:39 AM
- Cabot Oil & Gas (COG) -6.1% premarket ahead of its Q1 earnings report due Thursday.
- Topeka Capital analysts expect a mixed quarter with a miss on production and discretionary cash flow per share, but a slight EPS beat.
- "While COG's superior resource base is indisputable, concerns and uncertainty around differentials and production growth may keep shares under pressure near-term," the firm writes.
- UPDATE: Sources earlier reported incorrectly that the analyst comments had come from BlueMatrix.
Apr. 12, 2014, 8:25 AM
- Ohio geologists for the first time have linked earthquake activity in the Marcellus Shale to fracking, a new connection that could have implications for oil and gas drilling in the state and beyond.
- As a result, Ohio is setting new permitting conditions in quake-sensitive areas and has halted drilling indefinitely at the site of five quakes last month in the Youngstown area.
- Earthquakes recently rattled residents in Oklahoma, putting that state on track for record quake activity this year, which some seismologists say may be tied to oil and gas exploration.
- Among companies drilling in the Marcellus and Utica shales: RRC, CHK, COG, ACMP, APC, ATLS, CVX, CNX, DTE, EOG, EQT, XCO, XOM, MWE, NBL, RGP, REXX, RICE, RDS.A, RDS.B,SWN, STO, SXL, TLM, WMB, WPX.
Apr. 10, 2014, 10:57 AM
- Cabot Oil & Gas (COG -3.2%) is downgraded to Hold from Buy with a $36-$38 fair value range replacing the former $45 target price at Stifel, which also lowers its estimate for 2014 cash flow per share to well below Wall Street consensus.
- The firm also believes the volatility and concern around realized gas pricing will increase as summer unfolds, and pricing will remain an issue through 2015, which means that 2015 consensus estimates also are too high.
Apr. 10, 2014, 10:46 AM
- Oklahoma is experiencing a noticeable increase in earthquakes near drilling sites, according to the Oklahoma Geological Survey, suggesting a potential link between fracking and seismic activity.
- The state already has experienced as many earthquakes YTD than all of last year combined: 109 earthquakes with a magnitude 3 or higher through April 6, the same number of earthquakes as in all of 2013.
- The incidents pose a conundrum for regulators in a state that has fully embraced oil and gas drilling.
- Among drillers with a significant Oklahoma presence: CHK, CLR, APA, DVN, SD, EOG, MRO, OKE, OKS, GPOR, WPX, WMB, WPZ, LPI, CWEI, NFX, NGL, COG, WLL, NBL, MPO, PQ, XEC
Apr. 8, 2014, 6:21 PM
- Drilling fees on nearly 6,500 natural gas wells in the Marceluus Shale will bring more than $630M to Pennsylvania's coffers by the end of the year, three years after the state passed the fees into law, but critics say the oil and gas companies aren’t paying enough.
- Range Resources (RRC) paid the most with $27M in fees last year, followed by Chesapeake Energy (CHK) with $26.6M; among others, Cabot Oil & Gas (COG) forked over $13.2M, Anadarko Petroleum (APC) paid $12.3M, and EOG Resources (EOG) coughed up $4.5M.
- Critics who want the companies to pay more point to a report from the state’s independent fiscal branch that found Pennsylvania’s drilling fees were lower than severance tax rates on gas production in Texas and other states, which do not have drilling fees.
Mar. 7, 2014, 6:25 PM
- A drilling surge in the Permian Basin appears to account for this week's increase in the U.S. oil rig count, which jumped by 13 to a record high 1,443 in the latest tally by Baker Hughes (BHI).
- “While it’s one of the oldest fields in the U.S., there are multiple producing formations there, and companies are learning how to optimize horizontal drilling in them," WTRG Economics' James Williams says. "The growth is evidence that they’re figuring it out."
- Indeed, as Permian crude production per rig is expected to climb to 98K bbl/day this month, up from 83K a year ago, according to the U.S. Energy Department.
- While Pioneer Natural Resources (PXD), for example, is drilling in a 300-ft. thick shale shale formation in Texas' Eagle Ford play, the Permian offers shale depths of 3,500 ft., “so this is why this area has really substantial running room going forward,” COO Timothy Dove says.
- Other top Permian producers: CXO, APA, COG, CVX, OXY, EGN, END.
Mar. 7, 2014, 11:58 AM
- Cabot Oil & Gas (COG +0.8%) is upgraded to Buy from Accumulate at KLR Group, which notes that COG's largest catalyst for growth is the Appalachian Basin Marcellus Shale, projecting ~41% production growth in 2014 as it plans to start a six-rig program to begin drilling this year.
- The firm's new $48 target price is based on the NPV of free cash flow over the life of a company using a reasonable discount rate; COG's valuation applies a 12.5% discount rate to determine the NPV of its free cash flow.
Feb. 21, 2014, 12:49 PM
- Cabot Oil and Gas (COG -7.2%) shares plunge despite posting Q4 earnings and revenue that topped analyst forecasts.
- One possible cause for concern is that COG executives say they haven't been able to able to take full advantage of natural gas prices climbing to four-year highs recently due to unusually cold winter weather in large parts of the country, shrinking supplies.
- Through the first two months of the year, COG says the prices it is realizing from its Marcellus Shale assets have been $0.60-$0.65 below NYMEX settlement prices, a much wider differential than the company was expecting.
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