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Do you buy LIME yesterday? Neither did I...lol!
China overtakes the US to become the biggest importer of oil in the world.
http://www.bbc.co.uk/news/business-24475934#sa-ns_mchannel=rss&ns_source=PublicRSS20-sa
No Billy, nothing on the drillers side. Article doesn't shed positive light for the producers as well. However, domestic producers are in the limelight. Think they're in the top 20 sectors right now.
OT: Have you added any deep sea drillers/exp
to that list? Looks like they could be impacted.
http://www.businessinsider.com/ending-iran-sanctions-may-flood-oil-markets-2013-9
Chevron tops Credit Suisse energy picks amid slumping demand • 3:59 PM
Chevron (CVX) and Range Resources (RRC) stand out among energy plays Credit Suisse thinks will thrive amid fast-rising U.S. production and declining demand.
The firm favors upstream companies with repeatable drilling inventory at the low end of the cost curve (e.g. Wattenberg, Eagle Ford, Northern Midland, Utica,
super-rich Marcellus, core Bakken): Taking value into account, it likes Pioneer Natural Resources (PXD), Noble Energy (NBL), Anadarko Petroleum (APC),
Marathon Oil (MRO), Gulfport Energy (GPOR), Diamondback Energy (FANG) and PDC Energy (PDCE).
Diamondback Energy Raised to Buy From Neutral by Sterne Agee >FANG
(END) Dow Jones Newswires
September 24, 2013 08:42 ET (12:42 GMT)
Copyright (c) 2013 Dow Jones & Company, Inc.- - 08 42 AM EDT 09-24-13
Source: DJ Broad Tape
Insiders Are Selling Diamondback Energy
http://seekingalpha.com/article/1703892-insiders-are-selling-diamondback-energy?source=email_rt_article_readmore
Diamondback Energy prices $450 million private offering
of senior notes Deal In Brief
Sep 13, 2013 (MarketLine Financial Deals Tracker via COMTEX) -- Update on
September 12, 2013:
Diamondback Energy, Inc., a US-based company engaged in the acquisition,
development, exploration and exploitation of oil and natural gas, has priced a
private offering of $450 million aggregate principal amount of its 7.625% senior
notes due 2021 at an issue price of 100% of the aggregate principal amount of
the notes.
The notes will mature on October 1, 2021, unless redeemed in accordance with
their terms prior to such date.
Announcement (September 9, 2013):
Diamondback Energy has agreed to offer $450 million aggregate principal amount
of senior notes due 2021 in a private offering.
The notes will be general unsecured senior obligations of Diamondback Energy and
will be guaranteed on a senior unsecured basis by all of Diamondback Energy's
current subsidiaries and any future restricted subsidiaries that guarantee
Diamondback Energy's senior credit facility. Interest on the notes will be
payable semi-annually.
Deal Value (US$ Million) 450
Deal Type Private Placement
Sub-Category None
Deal Status Announced: 2013-09-09
Deal Participants
Target (Company) Diamondback Energy, Inc.
Acquirer (Company) Undisclosed Investors*
Deal Rationale
Diamondback Energy intends to use the net proceeds from the offering to fund its
pending acquisition of mineral interests in the Permian basin, US. Diamondback
Energy intends to use any remaining net proceeds from the offering to fund a
portion of its exploration and development activities and for general corporate
purposes, which may include leasehold interest and property acquisitions and
working capital.
(c) 2001-2007 Datamonitor. All rights reserved. Republication or redistribution, including by framing or similar means, is expressly prohibited without prior written consent. Datamonitor shall not be liable for errors or delays in the content, or for any actions taken in reliance thereon.
-0-
Source: Comtex Wall Street News
Forgot my biggest holding, NAVB. It's a long term hold tho. Had a Homer Simpson moment!
At the moment, nothing looks good to me. I have CRZO, MTDR and OAS in the oil production sector. Up really good on MTDR and CRZO, so looking to lock in profits on these two. Dumped AGU, still hold some AVD and recently took a position in RNF, but not sure I want it. Keeping an eye on that $25 level. Those are my Ag plays. Ags are washed out, IMO, as were the precious metal miners. Was early on the miners, but held out and averaged down to where I now have decent profits, so trading the miners and have a lock on nice gains. Other than this nailed IMMU and AMBA. IBD has the market in correction, the S&P Bullish Percent chart rolled over, NASTY and NYA not far behind. I'm about 80% cash. Take care!
Gotta run out for a few bud, bbl.
I see you've been on gold too, nice!
Doing great bud, except
I'm currently not in FANG - dammit. Picked up some Sept. 75's in
NOV at .72 a few days ago. I've slowly been going heavier in cash the
last two weeks and I've gotten distracted from energy. Dumb dumb!
Been playing with some GST and some other crap.
What looks good to you?
Hope all is well WB. How you playing FANG with Syria conflict? Double top around $44, sell it when bombs drop, wait for 50 ma to get taken out. Chart finally has a 200 dma.
Bakken Update: Diamondback's Production Ramp Provides Opportunity In Q3
Aug 25 2013, 18:01 | about: FANG, includes: APA, AREX, LPI, PXD, SYRG BOOKMARK / READ LATER
Disclosure: I am long FANG, SYRG. (More...)
Diamondback Energy (FANG) has been one of the best small cap oil and gas performers this year. It is one of the few ways to get pure small cap Permian exposure other than Approach (AREX) and Laredo (LPI). This has created some scarcity value, making these names a little expensive.
(click to enlarge)
The Permian is one of my favorite areas in 2013. The reason is simple, asset valuation. If you look at individual well results in the Midland Basin, NPV-10 is not as high as the Eagle Ford's average of $9.0MM/well. The above picture shows there is greater value due to the Midland's stacked resource potential and well spacing. This combination will create a higher acreage value as there are more locations per 640 acres.
(click to enlarge)
Undiscounted acreage values are slightly better in the Midland Basin, followed by Wattenberg Field and then the super rich Marcellus, by my estimates. This should provide a continued upside for Diamondback and other players in the Midland Basin. Keep in mind that Diamondback fits a specific type of investment that should be a focus with respect to small cap oil and gas. It offers a significant uptick in production. Like Synergy (SYRG) it is a vertical producer that is beginning a horizontal program. Well costs increase considerably, but production numbers increase exponentially.
Diamondback had a great second quarter. It reported EPS of $.30 versus the Street's estimate of $.26. It beat on the bottom line by $2.06 million, with revenues of $45.4 million. It also had a 6 cent unrealized gain on commodity derivatives for the quarter. Production increased 38% over Q1 of 2013. Oil volumes increased 49% over the same period. Lease operating expenses decreased by 20% sequentially. Short lateral well costs improved 12% quarter over quarter to $5.3 million. Its most recent short lateral had costs of just $4.8 million. Its long laterals (7,500 feet) had an average cost of $7.6 million, but its most recent completion was done for $7.2 million. Diamondback has had a very good result spreading out the frac stages. It is now using 250 foot stages and 300,000 pounds of proppant/stage. This was done while still using the same amount of water and proppant. This saves about three hundred thousand to four hundred thousand per well. Vertical well costs averaged $1.9 million, this is below Diamondback's estimated guidance of $2.2 to $2.0 million. Vertical well costs have improved due to shorter drill times. Q2 of 2013 EBITDA was $35.1 million versus $20.3 million in Q1. DD&A increased from $10.738 million in Q1 of 2013 to $14.815 million in Q2. Realized crude prices improved to $91.76/bbl from $83.89 in Q1. Over the same time frame, natural gas pricing improved to $4.08/Mcf from $3.28/Mcf. Realized NGL pricing decreased to $31.91/bbl from $35.12. Keep watching NGL prices. Ethane prices are probably heading lower.
Diamondback had some very good well results in Midland and Upton counties. All but one of its wells completed have been slickwater fracs. The table below lists those wells, all of which targeted the Wolfcamp B.
Well Lateral (Ft.) Stages
Peak IP 30 (Boe/d)
%Oil County
Kemmer 4209H 3,733 15 712 85 Midland
ST NW 2501H 4,451 19 655 90 Midland
ST NW 2502H 4351 16 500 88 Midland
Sarah Ann 3812H 4830 18 711 88 Midland
ST W 4301H 7141 29 916 85 Midland
Janey 16H 3842 16 486 86 Upton
Neal A Unit 8 1H 7441 32 697 87 Upton
Janey 3H 4411 19 488 82 Upton
Neal B Unit 8 2H 6501 26 617 73 Upton
Kendra A Unit 1H 7411 30 677 82 Upton
Jacee A Unit 1H 7541 30 632 83 Upton
The above table shows the progression FANG has made from short to medium length laterals. Diamondback is using tight stages and seems to be getting good source rock stimulation. ST W 4301H may be the most important test to date. This well had a very good peak 30-Day IP rate. This was done with a longer lateral and seems to show the pump trucks aren't too stressed pumping a stage 3,000 feet longer than its other average wells. Going forward pay close attention to Charlotte A Unit #1H. This well is over ten thousand feet long and a 39 stage frac. I think if wells can produce peak 30-Day rates close to 900 Boe/d, it will be a victory for Diamondback. There is no doubt production per foot will suffer some, but EURs will improve at a lower cost per foot. Longer laterals also provide a smaller foot print as there are fewer verticals to be drilled. To provide an idea of how other wells are producing in the same general area, I have provided the table below.
Operator Well Lateral IP 30 % Oil County
SUGG-C-27-1HM 982 77 Reagan
LPI SUGG-A-183-1HM 910 80 Reagan
(PXD) Mabee K #1H 6671 1040 76 Martin
PXD 2 Giddings Well Avg. 5300 669 76 Upton
PXD DL Hutt C #1H 7380 1402 75 Midland
PXD DL Hutt C #2H 7380 1107 74 Midland
While Diamondback concentrates on the Wolfcamp B, Laredo has been more aggressively developing the Wolfcamp A. It has completed two Wolfcamp B wells. These wells have produced well above Laredo's EUR 700 MBoe model. Laredo's average middle Wolfcamp well cost is $7.8 million. Pioneer has been developing several different payzones. The majority of its wells are Wolfcamp B, but it is targeting the other Wolfcamp layers. It is also drilling the vertical Spraberry, and continuing to work additional vertical intervals. Pioneer is outperforming, but has more experience in the Permian than Diamondback and Laredo. It is good to see Pioneer producing this well as other operators will soon be getting those types of results.
Diamondback's acreage is prospective several other payzones. Several operators have had very good results in the other Wolfcamp targets and the Cline. Apache (APA) has been testing further. It has had a significant number of horizontal and vertical results in the Midland Basin. The table below covers some of that data.
Well Target Lateral IP 30 Boe/d
Augusta Barrow 2301 Wolfberry NA 248
ED Books 35 #9 Fusselman NA 362
Eagle 36 #1 Fusselman NA 336
Woodpecker 36 #2 Wolfwood NA 310
Heidi 37 #3 Wolfwood NA 223
Hammerhead 33 #4 Lower Cline 4445 286
Sugg 1110 H31U Upper Wolfcamp 7800 422
Sugg 1110 H51U Upper Wolfcamp 7800 454
The above table shows additional targets in the general area of Diamondback's acreage. Below is a list of Apache's wells targeting the Cline.
Well EUR Lateral Stages
Mack 8-2H 372 4400 10
Squire 9-2H 389 4600 12
Bell 18-1H 356 3800 10
Barracuda 45 #2H 528 3800 11
Mac 6-Carter 43 380 6705 12
Marlin 47 2H 420 4255 12
The Barracuda well was the most impressive. It had a 30-Day IP rate of 623 Boe/d. Laredo has also targeted other zones. In the table below is a list of its completions in the upper and lower Wolfcamp, plus the Cline.
Well Target %Oil IP 30 Boe/d
Lane Trust-C/E-421HU Upper Wolfcamp 76 1183
Sugg-A-143-2HU Upper Wolfcamp 78 1160
Sugg-D-106-2HL Lower Wolfcamp 66 969
Sugg-A-157-1H Upper Wolfcamp 73 909
Sugg-E/A197-1HU Upper Wolfcamp 71 865
Sugg-A-143-1HU Upper Wolfcamp 76 846
Sugg-A/A208-1HU Upper Wolfcamp 66 843
Bearkat-150-5H Cline 74 835
Laredo's acreage is to the east of Diamondback's, but gives an idea of how the area produces. Very good upper Wolfcamp wells, and it seems to be the main target. The lower Wolfcamp had a very good number, but a lower crude percentage. The Cline was the worst producer, but it is still early and this deeper payzone should produce as well as the upper Wolfcamp.
In summary, Diamondback is doing all the right things. It is ramping production while decreasing LOEs. In Q2 it added 11,000 acres. Pioneer continues to develop to the north. Early completions point to its acreage in Andrews County being as good as in Midland. A recent completion by a private company had a very good horizontal Spraberry result, near its Midland County acreage. It has two rigs in Midland and one in Upton county. Diamondback will be receiving its fourth operated rig. Drilling times continue to decrease and it is now using long laterals. Its first 10,000 foot lateral should be producing soon. Well costs continue to decrease. Diamondback believes these costs will soon be to the low end of guidance. It is beginning its pad program which should decrease well costs by a half million. The first results should be in by the end of Q3. There are a significant number of reasons to be bullish Diamondback. Small companies in the process of a large production ramp can provide significant growth. My only worry with this specific stock is valuation. The Permian names are a little expensive when compared to those in the Niobrara. Its recent offering caused a pullback in shares, and this may provide an opportunity to get into this name.
Additional disclosure: This is not a buy recommendation. The projections or other information regarding the likelihood of various investment outcomes are hypothetical in nature, are not guaranteed for accuracy or completeness, do not reflect actual investment results, do not take in consideration commissions, margin interest and other costs, and are not guarantees of future results. All investments involve risk, losses may exceed the principal invested, and the past performance of a security, industry, sector, market or financial product does not guarantee future results or returns. For more articles like this check out our website at shaleexperts.com. Fracwater Solutions L.L.C. engages in industrial water solutions for oil and gas companies in North Dakota. This includes constructing water depots, pipelines and disposal wells. It also provides contracting services for all types of construction at well sites. Other services include soil remediation. Please contact me via email if you are interested in working with us. More of my articles and other pertinent information on the oil and gas sector, go to shaleexperts.com.
http://seekingalpha.com/article/1655862-bakken-update-diamondbacks-production-ramp-provides-opportunity-in-q3?source=email_rt_article_readmore
Diamondback Energy Announces Closing of Common Stock Offering
MIDLAND, Texas, Aug 20, 2013 (GLOBE NEWSWIRE via COMTEX) -- Diamondback Energy,
Inc. (Nasdaq:FANG) ("Diamondback Energy") today announced the closing of an
underwritten public offering of 4,000,000 shares of its common stock at a public
offering price of $40.25 per share. The underwriters have a 30-day option to
purchase up to an additional 600,000 shares from Diamondback Energy at the
public offering price (less the underwriting discount).
Diamondback Energy received net proceeds (after underwriting discounts and
commissions and estimated expenses) of approximately $154.3 million. If the
underwriters' option to purchase additional shares is exercised in full, the
aggregate net proceeds to Diamondback Energy are expected to be $177.4 million.
Diamondback Energy intends to use the net proceeds from the offering to fund its
pending acquisitions of additional acreage in the Permian Basin. To the extent
the pending acquisitions are not consummated, or the applicable purchase prices
are less than currently estimated, Diamondback Energy intends to use any
remaining net proceeds from this offering to fund a portion of its exploration
and development activities and for general corporate purposes, which may include
leasehold interest and property acquisitions and working capital.
Credit Suisse Securities (USA) LLC acted as sole book-running manager for the
offering. Copies of the prospectus for the offering may be obtained from Credit
Suisse Securities (USA) LLC, Prospectus Department (1-800-221-1037), at One
Madison Avenue, New York, New York 10010.
The common stock was issued pursuant to a registration statement on Form S-1,
which has been declared effective by the Securities and Exchange Commission.
This press release shall not constitute an offer to sell or the solicitation of
an offer to buy these securities, nor shall there be any sale of these
securities in any state or jurisdiction in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under the
securities laws of such state or jurisdiction. A copy of the registration
statement can be accessed through the website of the Securities and Exchange
Commission at www.sec.gov.
About Diamondback Energy, Inc.
Diamondback Energy is an independent oil and natural gas company focused on the
acquisition, development, exploration and exploitation of unconventional,
onshore oil and natural gas reserves in the Permian Basin in West Texas.
Diamondback Energy's activities are primarily focused on the Wolfcamp,
Clearfork, Spraberry, Cline, Strawn and Atoka formations.
Forward Looking Statements
This news release contains forward-looking statements within the meaning of the
federal securities laws. All statements, other than historical facts, that
address activities (including the pending acquisitions) that Diamondback Energy
assumes, plans, expects, believes, intends or anticipates (and other similar
expressions) will, should or may occur in the future are forward-looking
statements. The forward-looking statements are based on management's current
beliefs, based on currently available information, as to the outcome and timing
of future events. These forward-looking statements involve certain risks and
uncertainties that could cause the results to differ materially from those
expected by the management of Diamondback Energy. Information concerning these
risks and other factors can be found in Diamondback Energy's filings with the
Securities and Exchange Commission, including its Forms 10-K, 10-Q and 8-K,
which can be obtained free of charge on the Securities and Exchange Commission's
web site at http://www.sec.gov. Diamondback Energy undertakes no obligation to
update or revise any forward-looking statement.
CONTACT: Investor Contact:
Adam Lawlis
+1 432.221.7467
alawlis@diamondbackenergy.com
http://media.globenewswire.com/cache/22886/small/19678.jpg
http://www.globenewswire.com/newsroom/ti?nf=MTMjMTAwNDU2MjUjMjI4ODY=
(C) Copyright 2013 GlobeNewswire, Inc. All rights reserved.
-0-
KEYWORD: MIDLAND, Texas
INDUSTRY KEYWORD: Energy Industries
SUBJECT CODE: Company Announcement
Stock Market News
ENERGY
FINANCING AGREEMENTS
Source: Comtex Wall Street News
Me to. I forgot I even looked at FANG, must of been in a seekingalpha article or something I read last month.
looks strong.
TGIF
I guess so, I looked away.
Diamondback Energy's target is raised
to $42 from $35 at Wunderlich, whose increased confidence in the Wolfcamp B formation and FANG's potential in four other zones for the future cause it to raise its price target multiple to account for the increased value. Also, FANG says its stock offering priced at a 0.7% discount to Tuesday's close and was boosted to 6M shares.
5 commodity stocks moving on news.
(Excerpt))
Oil & Natural Gas
We have continued to watch over the past few trading sessions as names in the Permian Basin, specifically the Wolfcamp/Sprayberry area, have defied gravity and risen even with headwinds developing and big run-ups in stock price recently. The latest bullish news was from Pioneer Natural Resources (PXD) which reported another solid well in the area that had a 24-hour IP Rate of over 1,500 BOE/D. The shares rose on that news and again yesterday after UBS upgraded their price target to $155/share due in part to the solid initial results. Couple this with seemingly unstoppable rise over at Diamondback Energy (FANG) and it is becoming apparent that investors are starting to focus upon these Permian names more and more and recognizing the promise that they hold. We are still bullish of the Permian play, specifically the Wolfcamp, but will wait until a pullback to reenter some of these trades. There are other names which have recently entered that are cheaper on a valuation standpoint but we recognize that a premium must be paid for names which are pure plays.
http://seekingalpha.com/article/1456431-5-commodity-stocks-moving-on-news?source=yahoo
Diamondback Energy raises $151.36 million in public offering of common stock Deal In Brief
May 22, 2013 (Datamonitor Financial Deals Tracker via COMTEX) -- Diamondback
Energy, Inc., a US-based oil and natural gas company focused on the acquisition,
development, exploration and exploitation of unconventional, onshore oil and
natural gas reserves, has completed its underwritten public offering of 5.175
million shares of common stock, including 0.675 million common stock sold
pursuant to the exercise of the underwriters' over-allotment option, at a price
of $29.25 per share for gross proceeds of $151.36 million.
Diamondback Energy Announces Closing of Common Stock Offering
MIDLAND, Texas, May 22, 2013 (GLOBE NEWSWIRE via COMTEX) -- Diamondback Energy,
Inc. (Nasdaq:FANG) ("Diamondback Energy") today announced the closing of an
underwritten public offering of 5,175,000 shares of its common stock at a price
of $29.25 per share, including the full exercise of 675,000 shares of common
stock that were subject to the underwriters' 30 day option to purchase
additional shares.
Net proceeds to Diamondback Energy, after underwriting discounts and commissions
and estimated expenses, are expected to be approximately $144.4 million.
Diamondback Energy intends to use the net proceeds from the offering to repay in
full all borrowings outstanding under its revolving credit facility, with the
balance of the proceeds to fund a portion of its exploration and development
activities and for general corporate purposes, which may include leasehold
interest and property acquisitions and working capital.
Credit Suisse Securities (USA) LLC acted as sole book-running manager for the
offering. Copies of the prospectus for the offering may be obtained from Credit
Suisse Securities (USA) LLC, Prospectus Department (1-800-221-1037), at One
Madison Avenue, New York, New York 10010.
The common stock was issued pursuant to registration statements which had become
effective with the Securities and Exchange Commission. This press release shall
not constitute an offer to sell or the solicitation of an offer to buy these
securities, nor shall there be any sale of these securities in any state or
jurisdiction in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of such state or
jurisdiction. Copies of the registration statements can be accessed through the
website of the Securities and Exchange Commission at www.sec.gov.
About Diamondback Energy, Inc.
Diamondback Energy is an independent oil and natural gas company focused on the
acquisition, development, exploration and exploitation of unconventional,
onshore oil and natural gas reserves in the Permian Basin in West Texas.
Diamondback Energy's activities are primarily focused on the Wolfcamp,
Clearfork, Spraberry, Cline, Strawn and Atoka formations.
Forward Looking Statements
This news release contains forward-looking statements within the meaning of the
federal securities laws. All statements, other than historical facts, that
address activities that Diamondback Energy assumes, plans, expects, believes,
intends or anticipates (and other similar expressions) will, should or may occur
in the future are forward-looking statements. The forward-looking statements are
based on management's current beliefs, based on currently available information,
as to the outcome and timing of future events. These forward-looking statements
involve certain risks and uncertainties that could cause the results to differ
materially from those expected by the management of Diamondback Energy.
Information concerning these risks and other factors can be found in Diamondback
Energy's filings with the Securities and Exchange Commission, including its
Forms 10-K, 10-Q and 8-K, which can be obtained free of charge on the Securities
and Exchange Commission's web site at http://www.sec.gov. Diamondback Energy
undertakes no obligation to update or revise any forward-looking statement.
CONTACT: Investor Contact:
Adam Lawlis
+1 432.221.7467
alawlis@diamondbackenergy.com
http://media.globenewswire.com/cache/22886/small/19678.jpg
http://www.globenewswire.com/newsroom/ti?nf=MTMjMTAwMzM2NDQjMjI4ODY=
(C) Copyright 2013 GlobeNewswire, Inc. All rights reserved.
-0-
KEYWORD: MIDLAND, Texas
INDUSTRY KEYWORD: Energy Industries
SUBJECT CODE: Stock Market News
ENERGY
OIL
Source: Comtex Wall Street News
Diamondback Energy prices $131.62 million public offering of common stock Deal In Brief
(Closed $31.44 + $1.50)
May 17, 2013 (Datamonitor Financial Deals Tracker via COMTEX) -- Update on May
15, 2013:
Diamondback Energy, Inc., a US-based oil and natural gas company focused on the
acquisition, development, exploration and exploitation of unconventional,
onshore oil and natural gas reserves, has priced an underwritten public offering
of 4.5 million shares of its common stock at a price of $29.25 per share to
raise gross proceeds of $131.62 million.
The 4.5 million shares offering represents a 0.5 million share upsize to the
originally proposed four share offering. The underwriters have an option to
purchase up to an additional 0.675 million shares from Diamondback Energy at the
public offering price (less the underwriting discount).
The offering is expected to close on May 21, 2013.
Announcement (May 14, 2013):
Diamondback Energy has commenced an underwritten public offering of four million
shares of its common stock.
The underwriters will have an option to purchase up to an additional 0.6 million
shares of common stock from Diamondback Energy.
Credit Suisse Securities (USA) LLC is acting as sole book-running manager, and
Akin Gump Strauss Hauer & Feld LLP is acting as legal advisor for the offering.
Deal Value (US$ Million) 131.62
Deal Type IPO
Sub-Category Secondary Offering,Pricing
Deal Status Announced: 2013-05-14
Deal Participants
Target (Company) Diamondback Energy, Inc.
Deal Rationale
Diamondback Energy intends to use the net proceeds from the offering to repay
all borrowings outstanding under its revolving credit facility, with the balance
of the proceeds to fund a portion of its exploration and development activities
and for general corporate purposes, which may include leasehold interest and
property acquisitions and working capital.
Offer Price ($ per share) 29.25
No. Shares Issued 4500000
(c) 2001-2007 Datamonitor. All rights reserved. Republication or redistribution, including by framing or similar means, is expressly prohibited without prior written consent. Datamonitor shall not be liable for errors or delays in the content, or for any actions taken in reliance thereon.
-0-
Source: Comtex Wall Street News
Wunderlich raises target to $35 from $25
Diamondback Energy (FANG +3.2%) is raised to Buy from Hold with a $35 target price (from $25) at Wunderlich, which believes strong results from 13 Wolfcamp B-targeted horizontal wells (11 operated) shows the operational expertise, asset strength and horizontal potential for FANG, while the recent equity offering puts it in a position to fund and accelerate its growth.
Diamondback Energy Raised to Buy From Hold
by Wunderlich Securities >FANG
(END) Dow Jones Newswires
May 16, 2013 09:37 ET (13:37 GMT)
Copyright (c) 2013 Dow Jones & Company, Inc.- - 09 37 AM EDT 05-16-13
Source: DJ Broad Tape
LOL What's hot in energy now,
besides everything? Hell, even my little tanker FRO has been on fire the last two days moving oil for
the rest of the world because of the situation in the U.S..
How's the second rental going? Is that something you'd recommend to someone else at this time?
Diamondback Energy 4.5 Million Share Offering Prices at 23-Cent Discount
By Kristin Jones
Diamondback Energy Inc.'s (FANG) increased offering of 4.5 million shares priced at $29.25, a discount of 0.8% to its Wednesday closing price.
The energy company said Wednesday that it was launching an offering of four million shares, as it looks to repay debt and to fund exploration and development.
The energy company expected to have roughly 41 million shares outstanding after the offering.
Shares were up 22 cents at $29.70 after hours.
Write to Kristin Jones at kristin.jones@dowjones.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
May 15, 2013 20:00 ET (00:00 GMT)
Copyright (c) 2013 Dow Jones & Company, Inc.- - 08 00 PM EDT 05-15-13
Source: DJ Broad Tape
I would expect that to correct in the short term, but wtfdIk?
FANG reported Q1 EPS of $0.15, misses by $0.02
analysts estimated $0.17. Revenue for the quarter came in at $28.91 million versus the consensus estimate of $32.97 million.
Diamondback Energy, Inc. Announces First Quarter 2013 Financial and Operating Results
Tuesday , May 07, 2013 16:01ET
MIDLAND, Texas, May 7, 2013 (GLOBE NEWSWIRE) -- Diamondback Energy, Inc. (Nasdaq:FANG) ("Diamondback" or the "Company") today announced financial and operating results for the first quarter ended March 31, 2013.
During the first quarter of 2013, net income was $5.4 million, or $0.15 per diluted share. Net income for the first quarter includes a net unrealized gain on commodity derivatives of $1.5 million ($1.0 million net of tax), or $0.03 per share. Without the impact of this item, net income for the first quarter of 2013 would have been $4.4 million, or $0.12 per share.
HIGHLIGHTS
The ST NW 2501H in Midland County, with a 4,451' lateral, was put on submersible pump and achieved a new peak 24 hour initial production ("IP") rate of 1,054 Boe/d, with a peak 30 day average IP rate of 655 Boe/d (90% oil).
The Neal B Unit 8-2H in Upton County, with a 6,501' lateral, was put on submersible pump and achieved a peak 24 hour IP rate of 1,134 Boe/d (88% oil).
Results from 8 horizontal Wolfcamp B wells have achieved peak 24 hour IP rates that averaged 836 Boe/d (87% oil) from lateral lengths that averaged 4,945'.
Lease Operating Expense ("LOE") decreased 20% to $12.61/Boe in Q1 2013, from $15.68/Boe in Q4 2012, on a pro forma basis.
Q1 2013 exit rate production was 5.5 MBoe/d, a 21% increase from the pro forma Q4 2012 exit rate. Oil exit rate increased 38% over the same period.
Q1 2013 EBITDA was $20.3 million.
Diamondback's borrowing base increased 33% to $180 million on May 6, 2013.
"During the first quarter of 2013, we continued to ramp production while executing on our initiatives to achieve best-in-basin margins. We are encouraged by the early success of our horizontal drilling program where we have averaged 24 hour IP rates from eight horizontal wells of 836 Boe/d (87% oil) with lateral lengths that average 4,945'. Each of these wells is performing at or above the type curve we predicted for these wells," stated Travis Stice, Chief Executive Officer of Diamondback. Mr. Stice added, "Our operations team continues to improve performance by reducing cycle times and costs to a level we believe is among the best in the Midland Basin. Our Q1 2013 average well cost for short laterals was $6.0 million which is a 22% improvement over Q4 2012, and longer laterals averaged $7.8 million for Q1 2013 which is a 10% improvement over Q4 2012. Finally, we are starting to realize the benefits from our infrastructure investments, reducing our total LOE 20% from the previous quarter to $12.61 per Boe, for the first quarter of 2013 from $15.68 per Boe in the fourth quarter of 2012 on a pro forma basis."
HORIZONTAL DRILLING UPDATE – 15 WELLS UNDER DEVELOPMENT
During the first quarter of 2013, Diamondback concentrated its horizontal drilling activity in the Wolfcamp B shale, where it currently operates one rig in Midland County and another in Upton County. Diamondback plans to add a third horizontal rig in early Q3 2013.
As of May 6, 2013, Diamondback had drilled (or was a non-operating partner in drilling) a total of 13 horizontal Wolfcamp B wells with lateral lengths ranging from 3,733' to 7,441'.
Horizontal Focus: Midland County
Lateral Length Number of
Stages Peak 24 HR IP
(Boe/d) Peak 30 day IP
(Boe/d) % Oil(b)
Kemmer 4209H(a) 3,733' 15 892 712 85%
ST NW 2501H 4,451' 19 1054 655 90%
ST NW 2502H 4,351' 16 651 500 88%
Sarah Ann 3812H(a) 4,830' 18 892 711 88%
ST W 4301H 7,141' Well Drilled; 29 Stage Frac Completed
ST W 701H ~7,500' Well Drilled; 30 Stage Frac Scheduled May 27, 2013
Horizontal Focus: Upton County
Lateral Length Number of
Stages Peak 24 HR IP
(Boe/d) Peak 30 day IP
(Boe/d) % Oil(b)
Janey 16H 3,842' 16 618 486 86%
Neal A Unit 8 1H 7,441' 32 871 697 87%
Janey 3H 4,411' 19 572 488 82%
Neal B Unit 8 2H 6,501' 26 1134 N/A(c) 88%(d)
Kendra A Unit 1H 7,411' Flowback Operations Underway
Jacee A Unit 1H ~7,500' Currently Completing 28 Stage Frac
Janey 2H 4,570' Well Drilled; Frac Scheduled
(a) Non-Operated
(b) During the period for which the peak 30 day IP rate is presented.
(c) Well was completed on 4/7/13 and started cutting oil on 4/14/13. A peak 30 day IP rate is not available.
(d) On 24 hour peak IP rate
VERTICAL DRILLING UPDATE – COSTS COMING DOWN / EFFICIENCIES UP
During the first quarter of 2013, the Company drilled 14 vertical wells while running an average of two rigs. Diamondback reached TD in an average of nine days (down from an average of 11 days in Q4 2012), with three of those recent vertical wells reaching TD in less than eight days. Diamondback anticipates drilling a total of 35-40 gross vertical wells during 2013.
PRODUCTION (unaudited)
Pro Forma1 Historical
1st Quarter 4th Quarter 4th Quarter
2013 2012 2012
Production Volumes
Oil (MBbls) 301.0 287.5 272.1
Gas (MMcf) 351.0 356.7 339.1
Liquids (MBbls) 71.3 75.9 73.1
Oil Equivalents (MBoe) 430.8 422.8 401.7
Avg. Daily Production (MBoe/d) 4.8 4.6 4.4
Average Realized Price
Oil (per Bbl) $83.89 $81.60 $81.44
Oil with Effect of Hedges (per Bbl) $78.76 $77.87 $77.50
Natural Gas (per Mcf) $3.28 $3.17 $3.37
Natural Gas Liquids (per Bbl) $35.12 $32.38 $33.69
Oil Equivalents (per Boe) $67.09 $63.96 $64.14
Oil Equivalents with Effect of Hedges (per Boe) $63.51 $61.43 $61.47
¹The Company completed its acquisition of certain oil and natural gas properties from Gulfport Energy Corporation ("Gulfport") on October 11, 2012. Pro forma production information presented in this release gives effect to this acquisition as if it had occurred as of January 1, 2012.
The Company's first quarter 2013 exit rate production was 5.5 Mboe/d, up 21% from pro forma fourth quarter 2012 exit rate production of 4.5 Mboe/d. Q1 2013 exit oil rate of production was up 38% to 4.1 Mbo/d, compared to the Q4 2012 exit oil rate, reflecting the high oil percentage from horizontal wells.
FINANCIAL HIGHLIGHTS
First quarter 2013 income before income taxes was $8.6 million. The Company's net income after taxes was $5.4 million.
First quarter 2013 EBITDA was $20.3 million and first quarter 2013 revenues were $28.9 million.
As of March 31, 2013, Diamondback had $36.5 million drawn on its revolving credit facility. The Company's borrowing base recently increased by 33% to $180 million from $135 million in connection with its spring redetermination.
During the first quarter of 2013, capital expenditures were approximately $74.1 million, which included approximately $53.0 million for drilling and completion, $18.6 million to Gulfport for the final settlement of a post-closing cash adjustment in connection with the acquisition of its properties and the remainder for infrastructure, facilities and acquisitions.
FULL YEAR 2013 GUIDANCE
2013 guidance remains unchanged at this time.
2013 Guidance
Production 7,200 -- 7,500 Boe/d
Capital Expenditures $270 -- $300 million
Horizontal Per Well Costs $7.5 -- $8.5 million
Vertical Per Well Costs $2.0 -- $2.2 million
Direct Lease Operating Expense $8.50 -- $10.00/ Boe
Indirect Operating Expense (Ad valorem and overhead) $2.50 -- $3.00 / Boe
Production Tax 4.6% oil, 7.5% gas and NGLs
General and Administrative Expensives $3.00 -- $5.00 / Boe
Depreciation, Depletion and Amortization Expenses $22.00 -- $25.00 / Boe
CONFERENCE CALL
Diamondback will host a conference call with investors and analysts to discuss its first quarter 2013 results on May 8, 2013, at 10:00 a.m. ET. Interested parties should call (877) 440-7573 (United States/Canada) or (253) 237-1144 (International) and utilize the confirmation code 59387191. A live broadcast of the earnings conference call will also be available via the internet at www.diamondbackenergy.com under the "Investor Relations" section of the site. A telephonic replay will be available for anyone unable to participate in the live call. To access the replay, call (855) 859-2056 (United States/Canada) or (404) 537-3406 (International) and enter confirmation code 59387191. The recording will be available from 1:00 p.m. ET on Wednesday, May 8, 2013 through Tuesday, May 14, 2013 at 11:59 p.m. ET. The webcast will be archived on the Company's website for 30 days.
About Diamondback Energy, Inc.
Diamondback is an independent oil and natural gas company focused on the acquisition, development, exploration and exploitation of unconventional onshore oil and natural gas reserves in the Permian Basin in West Texas. Diamondback's activities are primarily focused on the Clearfork, Spraberry, Wolfcamp, Cline, Strawn and Atoka formations, which we refer to collectively as the Wolfberry play.
Forward-Looking Statements
This news release contains forward-looking statements within the meaning of the federal securities laws. All statements, other than historical facts, that address activities that Diamondback assumes, plans, expects, believes, intends or anticipates (and other similar expressions) will, should or may occur in the future are forward-looking statements. The forward-looking statements are based on management's current belief, based on currently available information, as to the outcome and timing of future events. These forward-looking statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include the factors discussed or referenced in the Company's filings with the Securities and Exchange Commission ("SEC"), including its Form 10-K, that could cause actual results to differ materially from those projected. These filings are available for free at the SEC's website (http://www.sec.gov). Any forward-looking statement made in this new release speaks only as of the date on which such statement is made and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise.
Diamondback Energy, Inc.
Consolidated Statements of Operations
(unaudited, in thousands)
Three months
ended March 31,
2013 Three months
ended March 31,
2012(1)
Revenues:
Oil and natural gas revenues $28,909 $16,351
Operating Expenses:
Lease operating expense 5,435 2,789
Production taxes 1,427 797
Gathering and transportation expense 133 67
Depreciation, depletion and amortization 10,738 4,757
General and administrative 2,471 1,184
Asset retirement obligation accretion expense 43 20
Total expenses 20,247 9,614
Income from operations 8,662 6,737
Other income 389 425
Net interest income (expense) (485) (880)
Loss on derivative instruments (8) (4,792)
Loss from equity investment ? (13)
Total other income (expense) (104) (5,260)
Net income before income tax 8,558 1,477
Income tax provision 3,162 ?
Net income $5,396 $1,477
Earnings per common share basic and diluted $0.15
Weighted average number of basic shares outstanding 37,059,071
Weighted average number of diluted shares outstanding 37,205,690
¹The company does not include earnings per common share basic and diluted, weighted average number of basic shares outstanding or weighted average number of diluted shares outstanding for the three months ended March 31, 2012 as Diamondback was not yet a public company and its assets and operations were owned by a limited liability company.
Non-GAAP Financial Measures
EBITDA is a supplemental non-GAAP financial measure that is used by management and external users of our financial statements, such as industry analysts, investors, lenders and rating agencies. The Company defines EBITDA as net income (loss) plus gain (loss) on derivative contracts, interest expense, depreciation, depletion and amortization, equity based compensation, asset retirement obligation, accretion expense and deferred income tax provision. EBITDA is not a measure of net income (loss) as determined by United States' generally accepted accounting principles, or GAAP. Management believes EBITDA is useful because it allows it to more effectively evaluate the Company's operating performance and compare the results of its operations from period to period without regard to its financing methods or capital structure. The Company excludes the items listed above from net income (loss) in arriving at EBITDA because these amounts can vary substantially from company to company within its industry depending upon accounting methods and book values of assets, capital structures and the method by which the assets were acquired. EBITDA should not be considered as an alternative to, or more meaningful than, net income (loss) as determined in accordance with GAAP or as an indicator of the Company's operating performance or liquidity. Certain items excluded from EBITDA are significant components in understanding and assessing a company's financial performance, such as a company's cost of capital and tax structure, as well as the historic costs of depreciable assets, none of which are components of EBITDA. The Company's computations of EBITDA may not be comparable to other similarly titled measure of other companies or to such measure in our credit facility.
The following table presents a reconciliation of the non-GAAP financial measure of EBITDA to the GAAP financial measure of net income.
Three months ended
March 31, 2013
Net income $5,396
Loss on derivatives 8
Interest expense 485
Depreciation, depletion and amortization 10,738
Non-cash equity-based compensation expense 655
Capitalized equity-based compensation expense (197)
Asset retirement obligation accretion expense 43
Deferred income tax provision 3,162
EBITDA $20,290
CONTACT: Investor Contact:
Adam Lawlis
+1 432.221.7467
alawlis@diamondbackenergy.com
Diamondback Energy, Inc. Schedules 2013 First Quarter Conference Call for May 8, 2013)
MIDLAND, Texas, May 03, 2013 (GLOBE NEWSWIRE via COMTEX) -- Diamondback Energy,
Inc. (Nasdaq:FANG) today announced that it plans to release its first quarter
financial results on Tuesday, May 7, 2013 after the market closes.
In connection with the earnings release, Diamondback Energy, Inc. will host a
conference call and webcast for investors and analysts to discuss its results
for the quarter on Wednesday, May 8, 2013 at 10:00 a.m. ET.
Participants should call (877) 440-7573 (United States/Canada) or (253) 237-1144
(International) and utilize the confirmation code 59387191. A telephonic replay
will be available for anyone unable to participate in the live call. To access
the replay, call (855) 859-2056 (United States/Canada) or (404) 537-3406
(International) and enter confirmation code 59387191. The recording will be
available from 1:00 p.m. ET on Wednesday, May 8, 2013 through Tuesday, May 14,
2013 at 11:59 p.m. ET. A live broadcast of the earnings conference call will
also be available via the internet at www.diamondbackenergy.com under the
"Investor Relations" section of the site. The webcast will be archived on the
site.
About Diamondback Energy, Inc.
Diamondback Energy is an independent oil and natural gas company focused on the
acquisition, development, exploration and exploitation of unconventional,
onshore oil and natural gas reserves in the Permian Basin in West Texas.
Diamondback Energy's activities are primarily focused on the Clearfork,
Spraberry, Wolfcamp, Cline, Strawn and Atoka formations, which we refer to
collectively as the Wolfberry play.
CONTACT: Investor Contact:
Adam Lawlis
+1 432.221.7467
alawlis@diamondbackenergy.com
http://www.globenewswire.com/newsroom/ti?nf=MTMjMTAwMzE0MzAjMjI4ODY=
(C) Copyright 2013 GlobeNewswire, Inc. All rights reserved.
-0-
KEYWORD: MIDLAND, Texas
INDUSTRY KEYWORD: Energy Industries
SUBJECT CODE: Calendar of Events
ENERGY
CONFERENCE CALL
WEBCAST
Source: Comtex Wall Street News
?
Oil Might Go Below $85, But It Won't Stay There For Long
Apr 19 2013, 16:02 | about: CLB, includes: PBKEF.PK
Disclosure: I am long PBKEF.PK. (More...)
(There is a ton of $80-$85 oil still out there.)
The single most important item that is going to determine whether or not my portfolio does well is the price of oil. I've built my portfolio to benefit from what I believe will be a future of high oil prices.
I therefore enjoy weeks where oil drops by $10 a little less than most people.
By high oil prices I mean $80 plus, so I'm very comfortable with where oil has been for the past couple of years.
What I find hard to believe is how comfortable the general public now is with $80 oil. Thirteen years ago, the thought of $50 oil would have had people screaming about a financial crash caused by an oil shock.
The prospect of $80 oil would have seem outlandish and a catastrophe.
Will Oil Prices Stay Elevated?
The single biggest threat to my portfolio is, strangely enough, the very companies that my portfolio is made up of. Those companies are the unconventional North American light oil producers that have been responsible for recent growth in production.
My portfolio is loaded with these unconventional producers.
The media is full of stories about how booming unconventional production is going to cause a big drop in the price of oil. Peak oil is dead, they say!
Today I found an expert opinion that suggests that a long-term collapse in oil prices below $80 is something I likely don't have to worry about.
The experts I'm referring to are the management team at Core Laboratories (CLB).
Core Laboratories is a leading provider of proprietary and patented Reservoir Description, Production Enhancement, and Reservoir Management services.
The company provides the technology oil producers use to develop oil and gas properties. Core Labs provides services to the world's major, national, and independent oil companies.
The company is, therefore, at the forefront of understanding the economics of the oil industry. Core Labs has to know how oil prices are going to impact demand for its products.
Most importantly Core Labs has a very good idea the price at which the various unconventional oil plays in North America make money.
During the Core Labs conference call this week, the following was said during the question and answer session:
David Demshur - Chairman, President & CEO
Yeah, we hope, we're wrong on this James, but our view is that when we looked at a lot of the unconventional plays, you've got now WTI that has slipped below $90. For us, that's kind of a benchmark where we feel outside of the sweet spot in the Bakken, in the Eagle Ford, and then the Niobrara that it's very difficult to reach a reasonable return on investment for our clients.
James West - Barclays
Okay. That's pretty interesting given your view that $90 is kind of the threshold level would suggest that WTI is not going to stay there for very long or below $90 very long?
David Demshur - Chairman, President & CEO
Yeah, well. I don't know how long it's going to stay there, but the $90 WTI, the level that is necessary for reasonable return is not our view, it's our client's view.
That is pretty interesting information. Outside of the best areas of the Bakken and the Eagle Ford, companies can't make money drilling oil wells without at least $90 oil.
And if the companies can't make money, they stop drilling. And if the companies stop drilling North American oil production is going to slip almost immediately because these unconventional wells have steep decline rates.
Below is the decline curve of a typical horizontal oil well that Petrobakken (PBKEF.PK) drills in the Canadian portion of the Bakken:
If oil prices should drop to $60, the next thing that is going to happen (in my opinion) is that within months oil will bounce up to $120 because production will have dropped very quickly.
The United States added something like a million barrels per day from unconventional tight oil in 2012. Production from those wells will have dropped by 65% to 350,000 barrels per day in the first year. And then that production will drop another 40% in the second year.
We are on a treadmill that requires a constant drilling of oil wells in order to fight decline rates. We aren't drilling vertical onshore wells that produce at 10,000 barrels a day for five years any more.
We have entered a new era of high oil prices. Yes, the unconventional revolution is real, but it is going to require $90 plus oil prices to be sustained. It is these very high oil prices that created this unconventional revolution in the first place.
It is going to take a lot of capital invested into thousands and thousands of tight oil wells month after month to keep growing production.
The only way that capital is going to be available is if oil prices are high enough to allow a reasonable return on investment. The sweet spot for that seems to be (according to Core Labs and its customers) $90 plus.
http://seekingalpha.com/article/1355331-oil-might-go-below-85-but-it-won-t-stay-there-for-long?source=email_alternative_energy_in
We Will Never See Cheap Oil Again
By Tyler Crowe
Doesn't $2.50 per gallon for gasoline sound just dandy? During the 2012 presidential race, a couple candidates used that number as a way of showing how increased American production would lead to lower prices and higher energy security. The problem is, though, that despite the increase in production in the U.S., cheap gas and cheap oil will more than likely remain a pipe dream.
Let's look at why oil prices will remain high despite our best efforts.
Drilling costs just aren't what they used to be
The boom in U.S. energy has been made possible by several factors: development of advanced drilling technology, a large distribution network already in place, and a favorable regulatory framework. One element that is commonly overlooked, though, is the price of oil production. Accessing shale deposits requires not only deeper wells, but also much more energy for extraction. Today, wells are drilled for miles underground and cracked open with high pressure pumps and lots of water. Chesapeake Energy (NYSE: CHK ) estimates that each new well requires 5 million gallons of water. Despite the best efforts of exploration and production companies to reduce costs, these new drilling techniques have break-even wellhead prices for most U.S. shale plays at $55-$80 per barrel.
The U.S. is not the only country that needs expensive oil prices. Both Russia and Saudi Arabia, the two largest global oil producers, need high oil prices for economic sustainability. For Saudi Arabia, its $630 billion economic development program is funded on the back of its national oil company, Saudi Aramco. In order for the country to meet its budgetary obligations, it needs current production levels priced at about $90. The same can be said for Russia; its government's largest revenue source is oil royalties. For the country to balance its budget, oil export prices need to be north of $120. For both of these countries, it is imperative that oil prices remain high enough to prop up government spending.
Saudi Arabia, Russia, and the U.S. are the three largest oil producers in the world and are responsible for more than 35% of global production. If all three require higher oil prices to sustain production and financial stability, they will all produce oil accordingly to meet their needs.
Price is set by the most expensive markets
For many years, the U.S. has been the largest consumer of oil in the world. Despite our large import bills, we have had a modestly robust oil and gas industry that at its lowest point was still supplying 40% of demand. When compared to some of the other top oil consumers, our production looks pretty impressive.
Country Daily Consumption in Mbpd (World Rank) % Produced Domestically
U.S.A 18,949 (1) 59.9%
China 9,810 (2) 44.3%
Japan 4,464 (3) 2.8%
India 3,360 (4) 29.4%
Germany 2,400 (8) 6.8%
S. Korea 2,230 (10) 2.6%
France 1,792 (11) 4.3%
Italy 1,454 (15) 10.4%
5 Commodity Stocks Moving On News
Apr 4 2013, includes: FANG, KOG, MHR, SLW, VLO
Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in FANG over the next 72 hours. (More...)
Look for a bounce today as Japan has indicated that we are to expect easy money to be coming from the island via potential bond market buys and other means. The US$ is higher and Yen lower, but this adds further pressure to commodities as it now appears that 'King Dollar' is back. Great for the American consumer, but bad for our investments in the commodity sector, at least until inflationary pressures begin to arise.
Commodity prices this morning are as follows:
Gold: $1544.90/ounce, down by $9.40/ounce
Silver: $26.715/ounce, down by $0.082/ounce
Oil: $94.52/barrel, up by $0.07/barrel
RBOB Gas: $2.8936/gallon, down by $0.0204/gallon
Natural Gas: $3.907/MMbtu, up by $0.007/MMbtu
Chart of the Day:
Down, down, down? It certainly is not looking good for gold in US$ terms, but if you were to look at it in Japanese Yen terms the story would be different. It seems that the 'cute' gold trade might be the only way to go if you want to be bullish...
(see link at end)
Chart courtesy of Kitco.com.
Oil & Natural Gas
We saw yesterday that Diamondback Energy (FANG) had a nice pullback, which when coupled with the previous action in the shares does put it within the range where we said we would be buyers of an initial stake. So long as the share are below $25/share this morning, we expect to be owners of the stock...if not, we blame Japan. Remember, our goal is to set up an initial position around this level and then hope to possibly add shares on another pullback, but we really want the exposure directly (remember we already have it indirectly via Gulfport Energy) as we like the property portfolio. So 25-50% of your wanted position, depending on how much you are going to invest total, should be bought around these levels.
Big volume yesterday on the move lower. We are buyers here so long as the shares are below $25/share this morning.
(see link for chart]
In down markets we like to look for strength, because that strength is usually real strength unless of course it is simply due to a dead cat bounce (see the coal names from yesterday). We saw Magnum Hunter Resources (MHR) rising and then saw that it was due to an announced sale of their Eagle Ford Shale assets to Penn Virginia for $401 million. We were wondering what the company would do with these assets after the successful drilling results and this answered our question. Now the company has the flexibility to go prove up their other assets and create further value for shareholders via the drill bit. It was a nice asset that they sold, however we do believe that some of their other properties hold significant upside, especially when one looks around at some of the other players in those areas and sees what they have been able to do.
Precious Metals
We were lucky here...it appears that the support has broken...
(see link for chart]
In down markets we like to look for strength, because that strength is usually real strength unless of course it is simply due to a dead cat bounce (see the coal names from yesterday). We saw Magnum Hunter Resources (MHR) rising and then saw that it was due to an announced sale of their Eagle Ford Shale assets to Penn Virginia for $401 million. We were wondering what the company would do with these assets after the successful drilling results and this answered our question. Now the company has the flexibility to go prove up their other assets and create further value for shareholders via the drill bit. It was a nice asset that they sold, however we do believe that some of their other properties hold significant upside, especially when one looks around at some of the other players in those areas and sees what they have been able to do.
Refiners
Valero (VLO) shareholders saw shares fall below the $42/share level and finish the day at $40.60/share after falling $1.81 (4.27%) on volume of 20.7 million shares. Our other article this morning discusses a bit of the demographics of the shareholders and how that is possibly playing a part in this pullback but the bottom line is that these names had a great run and shareholders discounted the possibility of bad news ahead. The EPA is a formidable foe and so too are corn and grain prices. Watch for a move below $40/share and if so that could very well signal trouble ahead.
Trades
The Kodiak Oil & Gas (KOG) trade has worked out for the bears this time, and yesterday we noticed that the high of the day for the shares was $8.79/share, a penny under the level which we used to use for support on the downside and resistance on the upside. And resistance is exactly what yesterday's high sure looks like to us. With the shares closing at $8.41/share and volume having reached 9.2 million it does look like that last move higher is over and now we shall see if the $8.30/share area can hold. It did yesterday, but bulls certainly do not want to see more of a breakdown because that only raises more questions than it answers
http://seekingalpha.com/article/1320271-5-commodity-stocks-moving-on-news?source=yahoo
Wexford Plans 53-Story Tower in West Texas Oil Boomtown
By David Mildenberg - Apr 4, 2013 5:38 PM ET
Wexford Capital LP, a hedge fund with $5 billion in assets, is planning to build a $350 million office-and-condominium tower in Midland, Texas, as demand rises in a region home to the world’s second-largest oil field.
The proposed 53-story Energy Tower at City Center has begun pre-leasing its 560,177 square feet (52,042 square meter) of office space, said William Meyer, a partner at Energy Related Properties, which is working with Wexford on the project. The tower would be more than twice the height of the city’s tallest building.
Midland is located in the Spraberry-Wolfcamp range, which has 50 billion barrels of recoverable oil, second in the world to a Saudi Arabian field, oil-exploration firm Pioneer Natural Resources Co. (PXD) said in an investor presentation yesterday. No new high-rises have been built in the west Texas city of 120,000 since the mid-1980s, before collapsing oil prices sent the city’s economic fortunes plunging, according to Mayor Wes Perry.
“It’s perfectly logical that this gets built,” Joseph Jacobs, co-founder of Greenwich, Connecticut-based Wexford, said in an interview in Midland. “A new building like this in New York would receive little notice, but we think New York needs this type of building a lot less than Midland.”
Wexford should be able to find tenants for the building’s office space because of a supply shortage and rising demand from large oil companies returning to the Permian Basin after reducing operations in the 1980s and ’90s, Perry said. The west Texas basin has yielded more than 30 billion barrels over the past century, more than any other U.S. region, according to Midland College’s Petroleum Professional Development Center.
“We’ve never had someone willing to pull out the checkbook and do something like this,” Perry said.
Tower Financing
While Wexford hasn’t completed financing for the tower and office rents aren’t yet set, “money isn’t an issue,” Jacobs said. Plans for the tower include about 100 condominiums, a 198- room hotel, 53,500 square feet of retail space and a movie theater. The tower’s architect is Michael Edmonds, principal of Edmonds International Ltd. in New York. Energy Related Properties, Wexford’s partner on the project, is a Midland-based investment firm led by developers Meyer and Scooter Brown.
Wexford partners including Jacobs, Charles Davidson and Robert Holtz hold more than 25 percent of equity in Wexford, which focuses on energy and real estate investments, Jacobs said. The fund owns a 44 percent stake in Diamondback Energy Inc. (FANG), a Midland-based exploration company.
While Wexford has owned real estate since its 1994 founding, the Midland building would be the largest development it’s built, Jacobs said.
To contact the reporter on this story: David Mildenberg in Austin at dmildenberg@bloomberg.net
To contact the editor responsible for this story: Stephen Merelman at smerelman@bloomberg.net
FANG short interest increased 30,500s
from 530,300s to 564800s.
FANG
LNG to the 40's, imo.
Nice, great news for FANG and GPOR. What do you see in the crude chart? I'm seeing a couple resistance levels.
Diamondback Energy Given New $32.00 Price Target at Credit Suisse (FANG)
Posted by: Ghasem Abdullahian Analyst Articles - US, Investing
Diamondback Energy (NASDAQ: FANG) had its target price boosted by Credit Suisse from $26.00 to $32.00 in a report released on Tuesday.
Diamondback Energy (NASDAQ: FANG) traded down 3.30% on Tuesday, hitting $24.90. Diamondback Energy has a 1-year low of $15.65 and a 1-year high of $26.39. The stock’s 50-day moving average is currently $22.3. The company has a market cap of $921.0 million and a price-to-earnings ratio of 42.92.
A number of other firms have also recently commented on FANG. Analysts at Capital One raised their price target on shares of Diamondback Energy from $28.00 to $29.00 in a research note to investors on Friday, March 8th. They now have an add rating on the stock. Separately, analysts at SunTrust raised their price target on shares of Diamondback Energy from $28.00 to $29.00 in a research note to investors on Wednesday, February 27th. They now have a buy rating on the stock. Finally, analysts at Zacks upgraded shares of Diamondback Energy from an underperform rating to a neutral rating in a research note to investors on Wednesday, February 27th. They now have a $20.60 price target on the stock.
Six investment analysts have rated the stock with a buy rating, two have assigned an overweight rating, and four have assigned a hold rating to the company’s stock. The company has a consensus rating of overweight and a consensus target price of $26.70.
Diamondback Energy, Inc. (Diamondback) is an independent oil and natural gas company.The Company focuses on the acquisition, development, exploration and exploitation of unconventional, onshore oil and natural gas reserves in the Permian Basin in West Texas.
Correction. I actually bought OAS at trendline support. It was sold yesterday. My purchase was in Bonanza Creek (BCEI). Not sure I'll want to stick with it. That AD must've kicked in.
Thanks bud, got it marked,
I got DD done on TLLP, GEL and NRGY so far. Heading out for the day shortly so I'll look
at them this weekend, there is plenty of time.
Plan on starting to slowly slip into some defensive ETF's as well. I need more cash! lol
Have a great day.
Then you'll probably want NTI and HCLP on that list. Let me know what you think.
Hey boo, I'm doing great, thanks.
The only energy related stocks I'm currently holding are FANG and HEK. I got spooked out of KOG on the last run up around the 12th? Then fell asleep on the sub 9's, but I'm always around. I've started compiling lists for railways and MLPs for later in the year, the guys that construct the pipelines, storage and those that can haul it cheap: railways.
Hey there WB. Hope all is well. They're talking a decade so anything is possible. However, there's plenty of oil and I just don't see that extreme price for crude. $150 caps it for now, imo. We are in that intermediate wedge on crude that I've mentioned before and I see it approaching resistance here. The dollar isn't going to help us out either. Looks like GPOR broke out yesterday. I bought Oasis back. I own them, Bonanza Creek and also bought KOG below $9 when I brought that trade idea to your attention. For now, those are my E&P plays. Adeezl likes Tesla. Seems to me Elon Musk knows how to run a company. CLNE looks most interesting as it continues to consolidate. I'd rather buy this one when it breaks out from consolidation. This might take some time as they build out the infrastructure.
Hi boo, sorry I'm late getting back to you
I thought these estimates of where oil was headed in theis "Fool" piece trying to shill their product was interesting. Seems a tad extreme, no? But wdIk?
I hope to keep up a little better soon.
3 Companies That Could Save America From $250 Oil
By Tyler Crowe | More Articles | Save For Later
March 23, 2013 | Comments (27)
Despite increased oil production in the U.S. from unconventional sources such as the Bakken and Eagle Ford shales, oil prices haven't gone down. In fact, the price for a barrel of West Texas Intermediate crude is at about $93 and climbing. What's even worse is that one international group believes that the price of oil is poised to go up -- way up.
Who is proclaiming this bad news? The Organization of Economic Cooperation and Development, or OECD. Based on its models, a barrel of oil could be in the range of $150 to $270 by the end of the decade. Let's look at why they could be right and how we could avoid the sting of surging oil prices.
Why they could be right
Despite the large increase in domestic production, it costs more to access these new sources, and demand is still outpacing supply. According to EIA, demand for oil was about 1 million barrels per day higher than supply in 2011, and the projections for global demand are expected to continue to climb, thanks in large part to two countries: China and India.
On a worldwide proven-reserve basis, China and India are not well endowed, nor do they have a copious amount of deposits. Collectively, the two countries have only about 20.4 billion barrels of proven reserves, or about 1.3% of the world's total supply. Also, a few weeks ago, the U.S. Department of Energy reported that China had surpassed the U.S. as the world's largest importer of oil. From a raw numbers perspective, India doesn't hold a candle to China, but it still imports about 80% of its oil needs. With China and India -- the two most populous countries in the world -- growing GDP at roughly 8% and 6% annually, demand will more than likely skyrocket.
Why they could be wrong
Models are great, and they can give a decent window into the future -- if the correct assumptions are made. The OECD admits that these projections could be thrown off by two things: a slowing of global GDP, and the potential for oil substitutes to capture market share. Obviously, a slowing economy would put a dent in oil demand, but growing oil prices could be what brings GDP down as well. According to the IMF, imbalances in oil supply and demand could affect global GDP growth by as much as 1% annually -- a bit of a Catch-22.
With oil potentially getting that expensive, we need to seriously consider the potential of seeing another energy source replace oil demand. In the past 23 years, gasoline prices and the price for a barrel of West Texas intermediate in the U.S. have traded at a multiple of roughly 33.1. Based on the OECD's projections, this could mean that gasoline in the U.S. would cost somewhere in the range of $6.05 to $10.85. With current prices already causing a consideration of alternative fuels, $10 a gallon certainly would tip the scales in the favor of alternative sources.
What a Fool believes
More than 73% of petroleum consumption in the U.S. is from the transportation sector, and that's why automotive fuel costs are so important for U.S. energy. Using an average efficiency of 23 mpg per vehicle, about 15,000 miles driven per year, and the estimated cost of a gallon of fuel from earlier, five-year fuel costs for an individual could jump from $11,200 today to a staggering $32,900.
With fuel costs potentially tripling in seven years, there is an immense opportunity for companies that seek to replace oil, and there's a three-headed-monster of companies that look as if they could potentially do just that: Tesla Motors (NASDAQ: TSLA ) , Westport Innovations (NASDAQ: WPRT ) , and Clean Energy Fuels (NASDAQ: CLNE ) . Here's how.
For the individual consumer, the potential in alternative fuels is currently a bit challenging. The infrastructure for natural gas fueling stations simply isn't robust enough, and the space required for CNG fuel tanks makes it impractical for smaller vehicles. That's why Elon Musk's automotive baby, Tesla, is so attractive. Not only are its current vehicles basking in critical acclaim, but the company is also taking drive-train orders from Toyota Motors and Daimler for their own electric vehicles. Some may argue the merits of an electric car, but it certainly looks more economically viable with $10-a-gallon gas.
Based on current technology, we don't have the means to replace heavy-duty engines with electric ones -- and that's where natural gas engine manufacturer Westport comes into play. The company has developed a wide profile of engines used across the spectrum. It has OEM contracts with General Motors, Ford, Volkswagen, Hyundai, Fiat/Chrysler, Volvo, and Peugot-Citroen to build engines for both fleet vehicles and light-duty trucks. Its partnership with Cummins (NYSE: CMI ) gives it an inside track on the medium duty, long-haul trucking market. Furthermore, its collaborative work with Caterpillar (NYSE: CAT ) also provides a strong outlet to provide heavy-duty and off-road engines with a natural gas option. So whatever electric vehicles might not be able to cover, Westport has a solution.
When natural gas vehicles do start making an impact on U.S. roads, we'll need a way to fuel them, and Clean Energy Fuels is working on it. While its infrastructure is nowhere near matching the 150,000-plus gasoline fueling stations in the U.S., its natural gas fueling stations represent about 27% of all the nation's CNG stations. It has also entered into a partnership with Chesapeake Energy (NYSE: CHK ) to deploy CNG stations every 250 to 300 miles across the country. That may not be enough coverage for everyday consumers, but it could be a big win for the trucking industry.
None of these three companies will be able to solve the oil-alternative solution by themselves, but together they could form a formidable foe to break the oil cycle. If you're on the lookout for some currently intriguing energy plays, check out The Motley Fool's "3 Stocks for $100 Oil." For FREE access to this special report, simply click here now.
http://www.fool.com/investing/general/2013/03/23/3-companies-that-could-save-america-from-250-oil.aspx
I got a wedge within a wedge within another wedge on the dailies for crude. The range for the intermediate wedge is about $7, so I'm not comfortable labeling it as coiled just yet, but we are getting there. My innermost wedge tho, is coiled. Not sure what timeframe you were referencing. We're stuck between the 50 and 200 ma's. Remember, the FED has a dual mandate. Employment and Inflation.
"Hill Country". I like that! I'm just a stupid meathead! Often referred to as the "Uncommon Denominator". I can talk to just about anybody, and prefer to avoid the arrogant.
Position. So important. Always good to be in the lobby when the building catches fire! I Gotta position in DDD. Gotta monitor here! Talk atcha later.
Texas, in my mind, you're
thinking of JR. Spent a lot of time there, all of my in laws are there, ex still down the road, 'Hill Country" folk.
I have had my eye on LNG, oddly never looked at the board.
Swing, position trader, thanks for the heads up.
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