Mike Filloon On PDC Energy

SeekingAlpha.com:

The Niobrara may be the top play of 2013. Operators in the DJ Basin have already had a very good start. Bonanza Creek and Synergy, which I own, look to have reasonable growth targets. 

Pad development is just beginning, and laterals continue to get longer. We are seeing increased stages and downspacing is going very well. PDC Energy also has good acreage in the Niobrara and upside going forward. It had a good quarter. 

Adjusted diluted net income was $.23/share. Net income was $.64/share. Production was up 34% from Q2 of 2012. It has improved liquids production to 54%. PDC Energy is now running 3 rigs in Wattenberg. Wattenberg production is up 40% from Q2 of last year. All of this was accomplished even with midstream issues. The average realized sales price was $47.10/Boe. This compares to $41.73/Boe from the second quarter of last year. Production costs decreased to $9.83/Boe from $10.06/Boe in Q2 of 2012. Lease operating expenses decreased 11% year over year. Adjusted cash flow from operations was up 57% from Q2 of 2012. 

PDC Energy has everything I look for in small cap oil and gas. It's increasing liquids production. PDC Energy is mainly working a basin that is misunderstood. It is just finishing it largest pad in the Niobrara and it hasn't even come close to optimizing its well design.