Crisis averted..for now

Posted by bakken

The market looked to be in very precarious territory earlier this week with a worry that Italy debt situation would quickly deteriorate into a full blown crisis.    The Dow was down almost 400 points and a major think tank predicted that a banking crisis was a 65% possibility in November.    Italy,  for the short term however was able to quell fears by quickly passing austerity measures and Greece put a new PM in power.   The market responded by going up about 1% yesterday and futures indicate another positive movement today.   In the Bakken region a number of developments hit the news and are listed below

• The first train with Bakken crude oil shipments embarked on Monday from the newly completed Bakken Oil Express terminal near Dickinson, North Dakota, Lario Logistics said on Wednesday.   The BNSF railway train, owned by Berkshire Hathaway, left for St. James, Louisiana, with 70,000 barrels of crude aboard, said the company, which owns the terminal.
• Bakken oil from North Dakota weakened to a discount to West Texas Intermediate for the first time in more than eight months as output rose to a record and inventories in the U.S. Midwest increased.   North Dakota production reached a record 444,142 barrels a day of oil in August, up 4.5 percent from the previous month, according to the state’s Industrial Commission.
• Denbury Resources Inc. (DNR: 15.05 -2.21%),  has reported that net income attributable to company stockholders for the third quarter ended September 30, 2011 was $275.67 million, or $0.68 per diluted share, compared to $29.1 million, or $0.07 per diluted share, for the third quarter ended September 30, 2010.  Total revenues for the third quarter of 2011 were $576.5 million, compared to $466.7 million for the corresponding period of 2010.  The Company’s prior 2011 annual production guidance remains unchanged at 31,000 Bbls/d for tertiary production, 8,400 BOE/d for Bakken production and 65,600 BOE/d for total Company production. Also, the Company’s 2011 capital expenditure budget remains unchanged at $1.35 billion, excluding acquisitions, capitalized interest and tertiary start-up costs and net of an estimated $60 million in equipment leases.
• Crescent Point Energy Corp , a  producer of oil in Canada’s Bakken region, said  it climbed back to profit in the third quarter on increased production and prices as well as a  hedging gain.  Crescent Point earned C$205 million ($204 million), or 74 Canadian cents a share, up from a year-earlier loss of C$8 million, or 3 Canadian cents a share.The result included an unrealized gain of C$303 million in the recent quarter and a hedging loss of C$81 million in the third quarter of 2010.  Crescent Point said it remains on track to meet its production target for the year of 72,500 bpd.

 

Stay tuned for more Bakken news next week!

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Oasis Petroleum beats on earnings, could be an acquisition target

Posted by bakken

Oasis Petroleum Inc. (NYSE: OAS) announced financial and operational results for the quarter ended September 30, 2011 yesterday after the market closed.  In the quarter ending on September 30, 2011,  OAS grew average daily production to 11,583 barrels of oil equivalent per day (“Boepd”), a 110% increase over the third quarter of 2010. Daily production increased by 47% compared to the second quarter of 2011.  Increased Adjusted EBITDA to $62.9 million, an increase of $40.9 million over the third quarter of 2010 and a sequential increase of $18.4 million over the second quarter of 2011.    Thomas B. Nusz, Oasis’ Chairman and Chief Executive Officer stated

“Our multi-year inventory of oil drilling locations in the Williston Basin provides us with strong visible growth potential. Consistent with our plan, we just added our eighth and ninth operated rigs.”

Total revenue for the third quarter of 2011 was $87.6 million compared to $33.0 million for the third quarter of 2010, an increase of 166%. Sequential quarter-over-quarter revenue growth was $20.4 million, or 30%.   Lease operating expenses (“LOE”) increased $6.6 million to $9.8 million for the third quarter 2011 compared to the third quarter 2010 and increased by $3.6 million in the third quarter 2011 compared to the second quarter 2011.     With the latest earning report,  the forward 2012 PE for OASIS (OAS: 24.67 -1.32%) looks to be under 15.   This could be an attractive aquisition target with 300,000 plus acres in the Bakken region.   In an earlier Bloomberg report, Among companies drilling for Bakken shale oil, Oasis and Whiting now offer the greatest value per acre, according to data compiled by Bloomberg. Houston-based Oasis controls 303,000 net acres in the Bakken and has an enterprise value, or the sum of its equity and net debt, of about $2.87 billion.   Using Statoil’s deal offer of $12,082 per acre for Brigham, shares of Oasis and Whiting could now be worth at least 20 percent more in an acquisition, the data show.      Oasis is a likely takeover candidate because it has properties close to Brigham’s fields and is probably open to selling itself, Pritchard Capital’s Berman said.

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