Monday, June 9, 2014

A Whopping Seventeen (17) Producing Wells Were Completed; Six (6) New Permits -- The Williston Basin, North Dakota, USA; Triangle Petroleum Has Two Huge Wells

In case anyone missed it, Miss North Dakota was runner-up in Donald Trump's Miss USA Pageant this past Sunday night. 

Wells coming off the confidential list Tuesday:
  • 24823, 501, Petro-Hunt, Jensen 158-94-28D-21-1H, East Tioga, t4/14; cum 8K 4/14;
  • 26870, drl, XTO, Cindy Blikre 41X-2H,  Lindahl, no production data,
Active rigs:

Active Rigs192189213169120

Six (6) new permits --
  • Operators: Hess (3), XTO, Petro-Hunt, American Eagle
  • Fields: Robinson Lake (Mountrail), North Tobacco Garden (McKenzie), Little Knife (Dunn), Skjermo (Divide)
Wells coming off the confidential list over the weekend and today were posted earlier; see sidebar at the right.

Seventeen (17) producing wells were completed:
  • 25604, 883, OXY USA, Delvin Dukart 2-31-30H-143-95, Manning, t4/14; cum 12K 4/14;
  • 25801, 2,404, HRC, Fort Berthold 147-94-3B-10-7H, McGregory Buttes, t4/14; cum 4K 4/14;
  • 25995, 642, Cornerstone, Anderson B-2413-6191, Clayton, t5/14; cum 24K 4/14;
  • 26011, 1,165, Hess, HA-Chapin 152-95-3229H-5, Hawkeye, t5/14; cum 7K 4/14;
  • 26018, 30, MRO, Young 24-23TFH, Chimney Butte, t4/14; cum --
  • 26033, 626, Cornerstone, Hinds C-0631-6190, Northeast Foothills, t4/14; cum 26K 4/14;
  • 26075, 476, Triangle, Sanders 150-100-9-10-1H, Sandrocks, 31 stages; 3.7 million lbs sand/ceramic, t5/14; cum 43K 4/14;
  • 26080, 77, American Eagle, Braelynee 2-2N-163-101, Colgan, t4/14; cum --
  • 26312, 1,350, XTO, Kanyer Federal 11X-15F, Grinnell, t5/14; cum 1K 4/14;
  • 26313, 681, XTO, Kanyer Federal 11X-15B, Grinnell, t5/14; cum --
  • 26314, 1,423, XTO, Kanyer 11X-15A, Grinnell, t4/14; cum 8K 4/14;
  • 26315, 1,107, XTO, Kanyer 11X-15E, Grinnell, t5/14; cum 2K 4/14;
  • 26321, 580, Triangle, Sanders 150-100-9-10-2H, Sandrocks, t5/14; cum 44K 4/14;
  • 26660, 2,240, MRO, JWC 44-34H, Reunion Bay, 4 sections, t5/14; no production data,
  • 26694, 552, Triangle, Gustafson 148-100-5-8-2H, Buffalo, t5/14; cum 5K 4/14;
  • 26695, 550, Triangle, Gustafson 148-100-5-8-3H, Buffalo, t5/14; cum 5K 4/14;
  • 26718, 648, Hess, EN-State C-156-93-1615H-4, Alger, t5/14; cum 1K 4/14;

Triangle Petroleum -- Quarterly Report -- June 9, 2014

Triangle Petroleum beats by $0.04, beats on revs : Reports Q1 (Apr) earnings of $0.15 per share, $0.04 better than the Capital IQ Consensus Estimate of $0.11; revenues rose 191.0% year/year to $99.78 mln vs the $95.54 mln consensus.

Form 10-Q, June 9, 2014:

Summary of operating and financial results for the three months ended April 30,2014:
  • Production volumes totaled 723,518 Boe for the three months ended April 30, 2014 compared to 241,525 Boe for the three months ended April 30, 2013, an increase of 200%
  • Oil and natural gas sales were $60.8 million compared to $21.1 million for the three months ended April 30, 2013
  • Our average realized oil price increased to $90.88 per barrel compared to $89.69 per barrel in the first three months of fiscal year 2014
  • Net income was $14.5 million for the three months ended April 30, 2014 compared to $5.2 million for the three months ended April 30, 2013
  • Cash flow provided by operating activities was $39.8 million for the period ended April 30, 2014 compared to $8.3 million for the three months ended April 30, 2013
  • Spud 13 gross (9.1 net) operated wells and completed nine gross (6.1 net) operated wells during the three months ended April 30, 2014
Remember: "three months ended April 30, 2014, included two "tough" North Dakota winter months, February, March, and a wet spring month of April.

From a press release, earnings, dated April 16, 2014, for full fiscal year 2014, ending January 31, 2014, for comparison:
1,929 mboe (300% increase; 488 mboe FY13);  net proved reserves, 40MMboe (175% increase); revenues increased 326% ($260 million); net income to $1.07 EPS; downspacing to 600' apart; initial well results from currently producing infill wells indicate an approximate 15% increase in production

For Investors Only -- June 9, 2014

WTI oil: $104/bbl. For a bit of background, see yesterday's post.

Trading at new highs: AAPL, BHI, CAT, CLR, EOG, HAL, HES, HK, JOY, NFX, NOV, SLB, SRE, UNP, WIN, WMB.

Earnings after market close: TPLM. I can't remember if I linked this Zack's article on TPLM. Zack's is bullish on TPLM. [Update, 4:15 p.m. central time: I don't see the earnings report/press release yet, but it must be a good report, or investors think it will be a good report. At 4:01 EDT, shares were up almost 1%, and then at 5:06 EDT, up almost another 2%. So, we'll see. Later: results here. At 6:03 EDT, up almost 2.5%.]

Disclaimer: this is not an investment site. Do not make any investment decisions based on anything you read here or anything you think you may have read here. 

Income inequality: I mentioned this the other day. It could be my imagination but it appears there are an increasing number of articles and/or books on "income inequality." It would be expected that this topic would be an important topic for President Obama, but ironically, it should have been an important topic when he was first running for president, not in the six year of his two-term presidency. I assume this was an issue under other administrations but I do not recall this much attention. When one reads the net worth of Joe Biden, Henry Reid, and Nancy Pelosi and chart out their net worth over the last 10 years it is a very interesting picture, especially when considering the source of their new-found wealth. Regardless, whatever, here's yet another story on income inequality being reported by Yahoo!Finance.

Barron's: EOG
  • EOG Resources' crude oil production surged 42% in Q1, and if business stays on course, as expected, the E&P company could enjoy a 32% jump in earnings this year, according to a weekend profile in Barron's.
  • EOG's enterprise value is 6.9x this year's estimated EBITDA, roughly in line with the EV/EBITDA multiples accorded competitors Chesapeake Energy and Devon Energy, but the story says it deserves a loftier multiple than the group, given its significant drilling inventory, superior production growth, lower debt ratio, and 15.6% return on equity vs. an average of 9.5% among peers.
  • EOG raised its 2014 goal for growth in crude oil production to 29% from a prior 27%, and for total energy production to 12% from an earlier 11.5%, but its estimates often prove conservative, sparking expectations for more upward revisions as the year unfolds.

HK Provides Operational Update , Additional Information Regarding The Tuscaloosa Marine Shale


June 9, 2014: Zeits' "take" on the press release over at Seeking Alpha:
Based on my estimate, the 4% overriding royalty interest in one well could have an NPV-10% in the $1.1-$1.7 million range, which may increase the total return to preferred stock investors to over 20% per annum. (This is an estimate based on certain assumptions: detailed terms of the preferred stock have not been disclosed yet).
The good news, the financing is structured to limit the effective sell-down of the TMS asset in the financing and may be the lesser of all possible "necessary evils."
Original Post

Halcon appears to be moving quickly in the Tuscaloose Marine Shale. Three items from this press release:

1. Halcon's midstream subsidiary, Halcón Field Services, has acquired rights to develop an oil handling terminal at the Port of Natchez, a location with direct access to more than two million barrels per day of refining capacity on the Lower Mississippi River.  The Port of Natchez has existing infrastructure including loading docks, pipelines and direct access to the Canadian National railroad.

2. Signs a joint venture to expedite development of the TMS: Halcón announced the signing of a definitive agreement with credit funds and accounts managed by affiliates of Apollo Global Management, LLC, which will invest up to $400 million in the Company's wholly owned subsidiary, HK TMS, LLC.  Upon closing, HK TMS will hold all of Halcón's acreage in Mississippi and Louisiana that is prospective for the TMS formation.  The Company holds 100% of the common shares of HK TMS and is the sole manager of HK TMS.  Apollo will contribute $150 million in cash consideration for 150,000 of HK TMS preferred shares, and under certain circumstances, may acquire up to an additional 250,000 preferred shares of HK TMS on the same terms.  Holders of the HK TMS preferred shares will receive quarterly cash dividends of 8% per annum.    

3. Operational update: The Horseshoe Hill 11-22H-1 (92% WI) well in Wilkinson County, MS, achieved a 24-hour average initial production rate of 1,208 barrels of oil per day and 1.1 million cubic feet per day of 1,551 BTU natural gas on a 19/64 inch choke.  Based on gas composition analysis and assuming full ethane recovery, Halcón estimates that the well would produce an additional 212 barrels of NGLs per day for a total 24-hour average initial production rate of 1,548 barrels of oil equivalent per day.  The well has a 7,060' effective lateral and was completed with 24 frac stages, 21 of which were effectively pumped and 3 of which were partially pumped (less proppant placed than designed).  Halcón drilled this well in 39 days (spud to TD).

Disclaimer: this is not an investment site. Do not make any investment decisions based on anything you read here or what you think you may have read here.

Whiting Has Several Spectacular Wells; WTI Oil Back Up Over $103/Bbl (Posted The Day Before The Iraqi Insurgency)

Wow, wow,wow: Cleveland Clinic chief declines VA job. Smart man.

Moving the goal posts: I could be wrong but it was always my understanding that "full" employment was an unemployment rate of 4% or less. The mainstream media is changing "full" employment to "the norm." The mainstream media has also moved the goal posts from 4% to 5% unemployment. I do believe most folks now know that the "new norm" is 6% unemployment, and "full" employment will never again be seenag in my investing lifetime. In fact, the linked article suggests the unemployment rate is likely to rise, giving us a "new norm," but never mentioning "full" employment. The AP is reporting:
The unemployment rate has been on a slow downward trajectory since the recession ended nearly five years ago. While the overall jobless level has dropped to non-recession levels, the number of the working-age people with jobs is barely over 6 in 10, hovering at a level reminiscent of the late 1970s.
In May, the U.S. workforce-participation rate — the combination of those with jobs and unemployed workers actively seeking them — was just 62.8 percent, the same as the month before. Job markets have been essentially flat since October. [MDW has been noting this for two years despite what Reuters and the AP were saying previously.]
It may be quite a while before the jobless rate falls back to 5 percent and below, long the informal standard pegged by economists as a typical employment level for non-recession times.
But 5 percent may no longer be the norm.
Wal-Mart wages in Williston, via Carpe Diem.
Whiting: In case you missed it, Whiting reports a number of good wells today:
  • 25354, 1,179, Whiting, Mork Trsut 21-17-5H, Pleasant Hill, t12/13; cum 39K 4/14;
  • 25355, 2,061, Whiting, Mork Trust 21-17-4H, Pleasant Hill, t11/13; cum 36K 4/14:
  • 25356, 2,065, Whiting, Mork Trust 21-17-3H, Pleasant Hill, t11/13; cum 49K 4/14;
  • 25357, 2,069, Whiting, Mork Trust 21-17-2H, Pleasant Hill, t11/13; cum 49K 4/14:
  • 25389, 887, Whiting, Kessel 41-26PH, Zenith, t12/13; t12/13; 45K 4/14;
  • 25390, 1,117, Whiting, Kessel 21-26PH, Zenith, t12/13; cum 40K 4/14;
  • 25391, 1,263, Whiting, Kessel 11-26PH,  Zenith, t12/13; cum56K 4/14:
Oil is up over a dollar/bbl; trading above $103/bbl again.

Renewable energy. This graph says it all

Active rigs:

Active Rigs193189213169120

RBN Energy: takeaway capacity in the Permian; the series continues.

Disclaimer: this is not an investment site. Do not make any investment decisions based on what you read here or what you think you may have read here.

AAPL. Wow, this guy is in trouble

The Wall Street Journal

General Motors' recall related to defective ignition switches is attracting lawyers who forged some of the biggest civil settlements ever, from the landmark tobacco litigation to the Exxon Valdez.

Bergdahl. Loser.

Obama will expand student-loan forgiveness program. By executive order.