Wed, Jan. 14, 2:35 PM
- Barclays downgrades the large-cap E&P sector to Negative from Neutral and the small- and mid-cap E&P group to Negative from Positive, arguing that downside risk outweigh potential gains even if oil prices recover.
- Equity investors are pricing in WTI crude assumptions of close to $75/bbl in 2016 compared to current strip prices of ~$57, Barclays says, also noting that an abundance of relatively cheap oil supply from U.S. producers could further delay a price recovery.
- Among specific names, the firm downgrades CHK, SD, REN and HK to Underweight; DVN, CLR, KOS, MRO, RSPP and WLL are cut to equal weight.
- At the same time, Barclays picked a few favorites, upgrading Range Resources (NYSE:RRC) to Overweight from Equal Weight, and maintained Overweight ratings on large-cap E&P companies CNQ, EOG and NBL; among small- and mid-cap E&P names, the firm favors AR, CXO and XEC.
- ETFs: XOP, IEO, PXE
Tue, Jan. 13, 12:28 PM
- Canadian Natural Resources' (CNQ +1.1%) pledge to keep spending on expanding output at its biggest oil sands mine regardless of the price of crude shows that Canadian oil sands operators are intent on maintaining their production thanks to huge upfront costs, long-term breakeven points and lengthy production lives, continuing to add to the global oil glut, WSJ reports.
- CNQ said yesterday that it still expects overall output to grow beyond 2014 levels, and that it will continue expanding production because it expects higher volume will cut operating expenses at its Horizon mine - currently C$37.13/bbl - by at least another C$10/bbl.
- Existing oil sands surface mines can make money at ~$30/bbl, and the most efficient underground oil sands projects run by Cenovus Energy (CVE -1%) can stay profitable at $35/bbl, according to the report.
- Suncor (SU +1.9%) CEO Steve Williams said in November that his company’s strong balance sheet would allow it to ride out the turbulence and stick with a bullish growth strategy.
Mon, Jan. 12, 7:48 AM
- Canadian Natural Resources (NYSE:CNQ) says it is cutting its FY 2015 capital spending plan and production forecast, citing slumping crude oil prices.
- CNQ now plans to spend C$6.2B ($5.25B) in 2015, 28% lower than its November forecast of C$8.6B, while increasing production of crude oil and natural gas liquids by ~7% over 2014 to 840K-887K boe/day, down from an earlier projection of 11% growth and 869K-916K boe/day.
- CNQ says the lower budget will impact its drilling activity in North America and overseas, and will result in delaying C$470M in capex related to the Kirby North Phase 1 thermal in situ project in Alberta until oil prices stabilize.
Dec. 23, 2014, 3:45 PM
- Canadian Natural Resources (CNQ +2%) says it has stopped pumping steam into a well at its Wolf Lake facility in Alberta when oil products started leaking into an aquifer.
- CNQ first reported a casing break in one of the thermal wells at Wolf Lake on Oct. 29, which is when the company stopped steaming at the site; the Alberta Energy Regulator says the incident did not meet its posting criteria at the time because it did not impact a water body.
- Neither the company nor the regulator knows how much benzene had leaked into the underground aquifer, which alternates between pumping steam into the earth and pumping bitumen out of it.
Dec. 9, 2014, 5:25 PM
- Canada will not impose new carbon emission rules on its oil and gas sector in a time of falling oil prices, Prime Minister Harper tells the House of Commons as international talks begin in Peru to reach a new global agreement on curbing greenhouse gas emissions.
- Canada’s critical energy sector has been slammed by the recent collapse of world oil prices, and a number of Canadian producers recently have announced plans to cut spending and dividends.
- Harper’s government, which counts the resource-rich western provinces as its core political base, had said it was prepared to work with the U.S. on environmental rules covering the continental oil and gas sector.
- Among Canada's top energy firms: SU, ENB, EEP, EEQ, TRP, IMO, CNQ, TCK, CVE, BTE, OTCQX:COSWF, OTCQB:HUSKF
Dec. 8, 2014, 3:37 PM
- Energy stocks are hammered again as oil prices tumble to fresh five-year lows, and Oasis Petroleum (OAS -16.1%), Emerald Oil (EOX -12.7%), Cobalt International Energy (CIE -10.1%) and Canadian Natural Resource (CNQ -4.8%) are slammed more than most as they suffered analyst downgrades today.
- SunTrust's Ryan Otaman cuts OAS and EOX to Neutral from Buy to account for their large debt loads, while Citi's Robert Morris lowers CIE and CNQ to Neutral from Buy.
- However, Morris thinks at least some stocks warrant upgrades after precipitous declines, raising Antero Resources (AR -9.1%), Apache (APA -6.1%) and Newfield Exploration (NFX -8.3%) even while acknowledging they probably will not bottom until oil does - a common view among analysts such as Raymond James' Marshall Adkins, who writes that "trying to figure out appropriate oilfield service valuations under a collapsing oil price environments is an exercise in futility."
Dec. 3, 2014, 11:32 AM
- The energy sector (XLE +1.5%) continues its momentum from yesterday, leading the way again as the best performing sector in early trading with crude oil rising 1.2% so far today and reports that U.S. well permits fell 40% last month.
- Top performers include Clayton Williams (CWEI +7.7%), Transocean Partners (RIGP +10.6%), Gaslog (GLOG +13.8%) and Energy XXI (EXXI +15.7%).
- Other leading energy names are showing stronger recoveries as they clear last Friday's bearish gap zone: XOM +0.2%, CVX +0.4%, COP +2.5%, OXY +2.5%, DVN +2.9%, EOG +2.5%, HES +2.2%, MUR +1.5%, NBL +2.3%, PXD +4.2%, SU +3%, CNQ +1.9%.
- Some analysts warn that the worst may not be over, however, as much of the advance is being driven by investors repurchasing ETFs they used to make short bets; investors also could opt to sell oil shares at a loss in coming weeks to reduce tax burdens.
Dec. 1, 2014, 10:11 AM
- Canadian Natural Resources (CNQ -0.9%) Chairman Murray Edwards predicted Friday that oil prices could collapse to US$30/bbl before stabilizing at $70-$75.
- Edwards says industry projects that are already underway, particularly oil sands projects with a long-term horizon and capital already invested, likely will continue, but others will be shelved until there is more clarity around future oil prices; Edwards also sees a slowdown in conventional oil projects, especially those that tend to produce a lot at the front end.
- He expects efforts to build new pipelines such as Keystone XL (TRP +0.6%) and Energy East (ENB +0.8%) to continue because they represent a 30-50 year opportunity for Canada.
- Brace for such “apocalyptically low” oil calls now, Jason Zweig writes: “Watch for the last optimists to be swept away by pessimism - at which point it will be an opportune time to add to your energy stocks or MLPs... We’re probably not there yet."
Nov. 14, 2014, 1:11 PM
- The Republican-led House passes the Keystone pipeline bill (TRP +0.2%), as expected, with a Tuesday vote upcoming in the Senate, which is still controlled by Democrats until January; if approved there, the bill would go to Pres. Obama, who says more time is needed to study the project.
- A Bloomberg report says the long delays to the pipeline are providing little obstacle to western Canadian oil producers - such as Suncor Energy (NYSE:SU), Imperial Oil (NYSEMKT:IMO) and Canadian Natural Resources (NYSE:CNQ) - in getting their crude to the U.S. Gulf coast, with shipments set to more than double next year.
- “Keystone is kind of old news,” says the director of energy analytics at RBN Energy. “Producers have moved on and are looking for new capacity from other pipelines.”
Nov. 6, 2014, 6:49 PM
- Canadian Natural Resources (NYSE:CNQ) says development of its 50K bbl/day Grouse oil sands project in Alberta is at risk of being deferred next year if U.S. oil prices approach $70/bbl.
- CNQ plans to raise oil and gas output 11% next year, CEO Steve Laut says, adding that its C$8.6B ($7.5B) capital spending plan for next year is subject to change with C$2B of capital flexibility, enabling it to allocate capital to the projects which generate the highest returns.
- CNQ plans to continue expansion phases 2 and 3 at its Horizon oil sands mine and upgrader to boost production of synthetic crude oil to 250K bbl/day in the coming years, Laut says, but it is unlikely the company would consider a fourth expansion phase.
- Earlier: Canadian Natural profit falls on lower oil prices, sets 2015 capex at C$8.6B
Nov. 6, 2014, 9:58 AM
- Canadian Natural Resources (CNQ +1.7%) is higher after Q3 earnings fell 11% Y/Y, hurt in part by lower crude oil prices, but came in well ahead of analyst expectations.
- Q3 total production rose 13% Y/Y to 797K boe/day but fell Q/Q due to a longer than planned shutdown for expansion and maintenance work at its Horizon oil sands project in Alberta; targets FY 2014 production of 869K-916K boe/day.
- Cash flow fell slightly to C$2.44B from C$2.45B, hurt in part by lower synthetic crude oil sales volumes at its Horizon operations and lower crude pricing.
- For 2015, CNQ is targeting a capital budget of ~C$8.6B ($7.6B), cash flow of ~C$9.4B and production growth of 11% over 2014 levels.
Nov. 6, 2014, 9:27 AM| Comment!
Nov. 6, 2014, 5:55 AM| Comment!
Nov. 5, 2014, 5:30 PM
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Sep. 16, 2014, 9:55 AM
- Canadian Natural Resources (CNQ +1.1%) will be allowed to resume production at its Primrose East oil sands site in Alberta which has been plagued by unexplained leaks of crude that seeped to the surface, the province’s energy regulator said yesterday.
- The decision partially lifts restrictions on CNQ's operations that had been in place since mid-2013 after mysterious leaks of crude were detected at four separate locations at the site.
- Last month, CNQ lowered its annual production forecast, citing delays in the resumption of operations at Primrose East.
Sep. 12, 2014, 10:36 AM
- Canadian Natural Resources (CNQ -0.3%) says production at its Horizon Oil Sands project in Alberta has restarted following completion of the expansion of the coker plant.
- CNQ says the plant has a targeted increase in production capacity to 127K bbl/day, an increase from the previous production capacity of 115K, and maintains its previously issued FY 2014 guidance of 109K-115K bbl/day.
- Horizon production was taken offline for ~25 days starting in mid-August to complete tie-in work and to perform routine maintenance.
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