Monday, May 4, 2015

MDU Refinery News Hits Seeking Alpha -- May 4, 2015; EOG Earnings Triple Analysts' Forecasts! Building Still Going Up In The Bakken; Emerald's Production Up An Astounding 88%

  • MDU Resources and Calumet Specialty Products Partners  have started commercial production of diesel fuel and other products at its 20K bbl/day diesel refinery in North Dakota, the first greenfield fuels refinery built in the U.S. in nearly 40 years.
  • Designed to process locally sourced Bakken crude, the refinery is now producing diesel and scheduled to begin commercial fuel sales this month to local customers as the plant ramps up to its full diesel production capacity of up to 7K bbl/day; the refinery also will produce up to 6.5K bbl/day of naphtha for use as a diluent to transport heavy oil by pipeline or as a feedstock in gasoline production.
  • MDU says the cost of the plant, initially pegged at $300M, now has been revised to $425M-$435M.
Posted earlier from the press release.

From the 1Q15 earnings transcript regarding the refinery:
With more than two-thirds of North Dakota's diesel fuel currently imported into the state, the refinery is well positioned to meet strong regional demand and additionally local produce supplies of diesel fuel. We expect to begin sales of diesel fuel as the plant ramps up during the month of May.
Construction of the facility began just back in March 26 of 2013 and it is located 4 miles west of Dickinson, North Dakota.
We had more than 800 workers that were on site at peak construction and the plant was constructed with zero loss time accidents over the 2.1 million man hours worked to build the facility. The facility is designed to process some 20,000 barrels per day of locally sourced Bakken crude and the production slate includes up to 7,000 barrels per day of diesel, approximately 6,500 barrels per day of naphtha and about 6,000 barrels per day of atmospheric tower bottoms or ATBs. Naphtha will be used as a diluent to transport heavy oil by pipeline or as a feedstock in natural gas production and ATBs can be used as feedstock for lubricating oils and other refined products as well.
At least in this section, no mention that the project came in a) delayed; and, b) greatly over budget.


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EOG earnings slam analysts' forecasts. The AP is reporting:
EOG on Monday reported a first-quarter loss of $169.7 million, after reporting a profit in the same period a year earlier.
On a per-share basis, the Houston-based company said it had a loss of 31 cents. Earnings, adjusted for non-recurring costs, were 3 cents per share.
The results exceeded Wall Street expectations. The average estimate of 16 analysts surveyed by Zacks Investment Research was for earnings of 1 cent per share.

MDU today reported first quarter consolidated adjusted earnings of $22.8 million, or 12 cents per share, compared to $35.6 million, or 19 cents per share for the first quarter of 2014.
On a GAAP basis the company reported a loss of $306.1 million, or $1.57 per share, compared to first quarter 2014 earnings of $56.5 million, or 30 cents per share. GAAP results reflect a $315.3 million after-tax noncash write-down of oil and natural gas properties pertaining to a quarterly ceiling test.
Apparently misses by 7 cents, but I'm not sure about this.

Emerald Oil
  • First quarter production of 424,318 BOE increased 88% as compared to 225,905 BOE in the first quarter of 2014. Daily production averaged 4,715 BOEPD, 14% above the midpoint and 10% above the high end of Emerald's first quarter 2015 guidance range;
  • Completed semi-annual borrowing base redetermination resulting in an elected commitment of $200 million;
  • Semi-annual redetermination includes an expanded total debt to EBITDA covenant of 5.0x and a new senior secured debt to EBITDA covenant of 2.5x;
  • Hedging update: Recently initiated 2015 crude oil floors at $55.00 for 4,000 Bbl/d and 2016 crude oil floors at $60.00 for 3,000 Bbl/d while retaining all upside to future crude oil price increases;
Building In The Bakken

For the archives. The Dickinson Press is reporting that there is still building going on in the Bakken. Who wudda thought?

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