Thu, Jun. 25, 12:43 PM
- While UBS downgraded Chesapeake Energy (CHK -4.2%) and Murphy Oil (MUR -2.4%) today (I, II), the firm also upgrades Marathon Oil (MRO +1.4%) to Buy from Neutral with a $32 target price, finding MRO an attractive way to play its expectation for a long-term recovery in oil prices.
- UBS notes MRO's high oil exposure, above average debt-adjusted growth, leverage to low-cost resource in the Eagle Ford and SCOOP/STACK, strong balance sheet and inexpensive valuation vs. peers.
- The firm also says MRO is trading at a wider than normal discount to peers despite an above average cash flow per debt-adjusted share growth outlook.
Fri, Jun. 12, 6:44 PM
- North Dakota oil production fell 1.8%, or nearly 22K bbl/day, in April to ~1.17M bbl/day after recording a surprising jump in March, as weak crude prices led producers to ease production.
- The number of drilling rigs operating in North Dakota stands at 76, the lowest since December 2009, according to the latest monthly report from the state's Department of Mineral Resources.
- The agency director has said he expects the state’s oil production to remain at 1.1M-1.2M bbl/day until oil prices recover.
- April natural gas production was up slightly at 1.54B cf/day from 1.51B cf/day in March.
- Unimpressed commentator Gregor McDonald tweets: "Sorry America, but 9,525 wells in the North Dakota Bakken producing on average 116 bbl/day is more cartoon than triumph."
- Top Bakken producers include: CLR, EOG, XOM, HES, COP. MRO, WLL, OAS, NOG, EOX
Thu, Jun. 11, 11:47 AM
- Oil companies including Marathon Oil (NYSE:MRO), ConocoPhillips (NYSE:COP) and Royal Dutch Shell (RDS.A, RDS.B) have agreed to pay tens of millions of dollars into the $345M compensation fund for deaths and damage caused by the 2013 oil train explosion in Lac-Megantic, Quebec, WSJ reports.
- The oil companies have said their responsibility for the disaster ended with properly labeling the crude oil after pumping it out of the ground, which they say they did, but if the courts approve the fund, they would be shielded from several lawsuits; MRO, for one, says it contributed to avoid “the time and expense associated with protracted litigation."
- Earlier this week, World Fuel Services (NYSE:INT), which bought oil in North Dakota and contracted to have it hauled by rail to a refinery in New Brunswick, agreed to pay $110M into the fund.
Wed, Jun. 10, 12:58 PM
- The rapid contraction in the Bakken oil price discount may indicate a faster than expected production decline in the area, dealers say.
- The buying frenzy pushed Bakken delivered at Clearbrook, Minn., to trade just $0.35/bbl below the West Texas benchmark last week, dealers say, the narrowest discount since July 2013; four months ago, it traded at a $7.50 discount.
- Also, midwest refiners ran the most crude ever for the month of May thanks to a light maintenance slate and robust margins, triggering a bidding war for light barrels.
- Regardless, the disappearing discount offers a partial reprieve for large producers such as Continental Resources (NYSE:CLR) and Hess (NYSE:HES) after the past year slashed global oil prices by as much as 60%.
- Other top Bakken producers include: EOG, WLL, XOM, OAS, NOG, EOX, MRO
Tue, May 19, 10:35 AM
- The chairman of Libya’s National Oil Co. is reassuring Western energy firms that its company is operating without political interference, even as the country is divided between a Western-backed government and an Islamist militia that controls the capital Tripoli.
- The chairman says said he has gathered officials from joint ventures with Marathon Oil (NYSE:MRO), ConocoPhillips (NYSE:COP), Hess (NYSE:HES), Eni (NYSE:E) and Total (NYSE:TOT) to tell them the National Oil Co. was free of political interference in Tripoli and that its revenues moved transparently through Libya’s banking system.
- Libya currently produces 436K bbl/day of oil, less than a third of its normal output.
Mon, May 18, 7:54 AM
- Marathon Oil (NYSE:MRO) is seeking bids for its interest in four onshore exploration blocks in east Africa as part of a strategic shift to focus on U.S. shale, Reuters reports.
- MRO will take offers for all or part of the properties located in Ethiopia and Kenya, with cash bids due July 23, according to the report.
Wed, May 13, 6:19 PM
- North Dakota recorded a surprising jump in oil and natural gas production in March, as producers successfully wring efficiencies out of existing operations in an attempt to maintain production even at depressed prices.
- The state's oil producers pumped nearly 1.2M bbl/day in March, up ~15K from February, while natural gas output rose 14% to 47.2M cf, according to the Department of Mineral Resources.
- The agency says 189 North Dakota wells were completed in March at locations owned by Exxon Mobil (NYSE:XOM), Hess (NYSE:HES), Continental Resources (NYSE:CLR) and ConocoPhillips (NYSE:COP), as "these four appear to be more in tune with having normal cash flow, and continue to complete their wells in a more aggressive manner."
- But in a sign of divergent strategies in the state, EOG Resources (NYSE:EOG) and Marathon Oil (NYSE:MRO) continue to delay fracking.
- Other top Bakken producers include WLL, OAS, NOG and EOX
Mon, May 11, 4:59 PM
- Oil production from seven major U.S. shale plays is expected to fall by 86K bbl/day in June, according to the latest report from the Energy Information Administration.
- Oil output at the Eagle Ford shale play in South Texas is forecast to see the biggest decline, down 47K bbl/day, while production at the Bakken shale play, centered in North Dakota, is expected to drop by 31K bbl/day, the report says.
- "The data shows that production in the Bakken and Eagle Ford [plays] peaked in March at 1.33M bbl/day and 1.73M bbl/day, respectively," says WTRG Economics energy economist James Williams.
- Among the top Eagle Ford producers: EOG, BHP, COP, CHK, MRO, APC
- Among the top Bakken producers: CLR, EOG, WLL, HES, XOM, OAS, NOG, EOX, MRO
Fri, May 8, 3:09 PM
- Marathon Oil (MRO +0.8%) is upgraded to Outperform from Market Perform at a $34-$36 valuation range, raised from $30-$32, at Wells Fargo, which says MRO's attractive shale acreage and drilling program should deliver based on growth, cash flow and returns.
- The firm believes MRO has been disciplined in its spending, successfully controlled costs, has greater access to capital markets than its peers, and is well-positioned to grow production in 2015 and poised to accelerate if market conditions allow.
- Assuming no share repurchases, an estimated $500M in planned non-core asset sales, and a ramp down in capex levels for the remainder of 2015, the firm estimates MRO will return to a cash flow positive level during H2 2015.
Wed, May 6, 5:23 PM
Wed, Apr. 29, 5:20 PM
Wed, Apr. 22, 6:53 PM
- Nomura came out bullish today on the energy E&P sector - issuing Buy ratings for MRO, PXD, EOG, CLR, APC, NFX, RRC, CNQ, CXO, ECA and SU - even as the firm does not foresee a V-shaped rebound in crude oil prices.
- Nomura believes core North American shale plays do not represent the economic marginal cost of supply in the world, which runs counter to commonly held views that largely see shale occupying the high end of the cost curve; thus as oil rebounds, so will investment in the shales, which should support prices, the firm says.
- In such an environment, Nomura says selecting stocks will depend on factors such as ”the reinvestment opportunity set, impact of oilfield technology, continued efficiencies, potential new geologic plays, management acumen and balance sheet strength."
- The firm is Neutral on DVN, HES, MUR, OAS, UPL, WLL, XEC, COG, COP and SWN; it rates NBL, APA, DNR, CHK and CVE as Reduce.
Mon, Apr. 20, 10:58 AM
- Marathon Oil (MRO +2.3%) is upgraded to Overweight from Equal Weight with a $37 price target, raised from $25, at Morgan Stanley, as shares currently trade at a discount to peers despite the company's above average production.
- MRO has significantly lagged in the 2015 recovery in the E&P segment, and the firm says its discounted valuation has been traditionally justified by the company's shorter than peer inventory life, but the oil price driven pullback in activity has narrowed the gap.
- Stanley says MRO's downspacing efforts and enhanced completion are expected to provide a steady stream of catalysts in the near to medium term, leading to an increased NAV of $56/share.
Fri, Apr. 10, 11:26 AM
- Credit Suisse adds four companies to its U.S. Focus List, led by Devon Energy (NYSE:DVN), which it sees as a pure-play energy stock that investors can feel comfortable holding for the long-term and is not pegged to the oil markets.
- The firm also likes DVN's defensive valuation, top quartile oil growth profile and further accretion possibilities from the EnLink Midstream assets; its $80 stock price target is among the Street's best outlook.
- Credit Suisse cites another energy choice, Marathon Oil (NYSE:MRO), for its higher multiple businesses, and believes upstream cash margins have room to move up as shale production increases and oil prices recover.
- Also added to the U.S. Focus List: JPMorgan Chase (NYSE:JPM), Dunkin' Brands (NASDAQ:DNKN).
- Earlier: Dunkin' Brands tapped by Credit Suisse for new highs
Tue, Apr. 7, 5:38 PM
- Eni (NYSE:E) has emerged in recent weeks as the only international oil company still pumping near capacity in war-torn Libya, helped by protection from militias and tribes secured by its local partners, WSJ reports.
- The security risks have crippled the efforts of rival oil companies such as Total (NYSE:TOT), Repsol (OTCQX:REPYY, OTCPK:REPYF) and Marathon Oil (NYSE:MRO), which have said they have suspended production onshore in the country.
- Eni is the largest western producer in Africa, and its relationships there have helped it produce 240K boe/day in Libya last year and 300K boe/day in early 2015, by far the most of any company in the country.
- Eni says it has no agreements with any militias in Libya.
Tue, Apr. 7, 12:59 PM
- Peabody Energy (BTU +7.3%) spikes higher after Balyasny Asset Management's Christian Zann tells CNBC he likes the stock as a value play in the coal space.
- Zann points out that coal is a relatively low capital intensive business vs. shale producers, who must spend considerable sums drilling new wells to maintain a production base.
- Zann likes Schlumberger (SLB +1%) and Halliburton (HAL -1.3%) among oil services stocks, and Marathon Oil (MRO +1.3%) in the E&P group.
Marathon Oil Corp is an energy company engaged in the exploration, production and marketing of liquid hydrocarbons and natural gas, production and marketing of products manufactured from natural gas and oil sands mining.
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