Eight Wells Coming Off The Confidential List Today; Surging E&P Profits -- RBN Energy -- April 2, 2019

OPEC: lowest production 2015 -- Reuters.

The combined production of all 14 OPEC members stood at 30.4 million bpd last month, down by 280,000 bpd compared to February and the lowest level of OPEC production since February four years ago, according to the survey.

Production in March beat the previous four-year-low record of the cartel’s oil production from February 2019. As per Reuters survey last month, OPEC’s oil production fell by 300,000 bpd in February compared to January to stand at 30.68 million bpd.

Platts forecast:

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Back to the Bakken

Wells coming off the confidential list today -- Tuesday, April 2, 2019: 12 wells for the month; 12 wells for the quarter

• 35502, SI/NC,  RimRock Oil & Gas, MC MHA 24-10-3H, Moccasin Creek, no production data,
• 35391, SI/NC, Newfield, Dahl 150-98-5-8-7H, Siverston, no production data,
• 34959, 363, Lime Rock Resources, Federal Staael 2-32-5H-160-90L, Dimond, t10/18; cum 49K 2/19;
• 34412, drl, Crescent Point Energy, CPEUSC Dorothy 4-19-18-158N-98W MBH, Rainbow, no production data, 
• 34411, drl, Crescent Point Energy, CPEUSC Dois 7-19-18-158N-98W TFH, Rainbow, no production data,
• 34409, drl, Crescent Point Energy, CPEUSC Dois 6-19-18-158N-98W MBH, Rainbow, no production data, 
• 33668, 3,278, MRO, Fannie USA 21-1H, Reunion Bay, t2/19; cum 31K after 18 days;
• 29891, 316,  Lime Rock Resources, William Sadowsky 7-4-9H-142-96, Manning, t1/19; bcum 12: 2/19;

Active rigs:

$61.91	4/2/2019	04/02/2018	04/02/2017	04/02/2016	04/02/2015
Active Rigs	65	60	50	29	94

RBN Eenrgy: surging E&P profits, lower costs belie negative sentiment. Archived.

Crude oil and natural gas prices went through a lot of ups and downs in the 2014-18 period, but the general trend was down. The average price of WTI crude topped $100/bbl in the first half of 2014; by year-end 2018 it stood at $45/bbl. Similarly, the NYMEX natural gas price topped $6.00/MMBtu in early 2014 but fell to a low of about $2.50/MMBtu last year and averaged little more than $3.00/MMBtu. The 44 major U.S. E&P companies we track sought to weather this storm of declining prices by drastically repositioning their portfolios and slashing costs to stay competitive in a new, lower price environment. Their efforts appear to have worked: 2018 profits surged in comparison with 2017 results and approached returns recorded in 2014, when commodity prices were much higher. So why are E&P stock prices languishing? Today, we look at the divergence between investor sentiment and the actual financial performance of U.S. E&P companies.

U.S. exploration and production companies (E&Ps) have found it very difficult to shake the aura of doom and gloom that shrouded the industry after the 2014-15 oil price crash brought many to the brink of insolvency. Investor sentiment, as reflected in the S&P Oil and Gas E&P stock index, tells the tale. After reaching a high of more than 12,000 in mid-2014, the index plunged to as low as 3,600 in early 2016. With crude prices and profits rising after that, the index climbed back to about 6,600 in the fall of 2018, but plummeted nearly 40% to 4,000 — one-third of the 2014 high — in the second half of December (2018) on fears of a return to red ink as oil prices dipped to $45/bbl. But recently released 2018 financial results from our universe of 44 major U.S. E&Ps provided strong evidence that belied the negative sentiment about the sector.

Despite the fourth-quarter oil price decline, the industry roared back to profitability in 2018. More tellingly, the industry has streamlined its cost structure so dramatically that overall 2018 profits were just 20% below those generated in the $100+/bbl environment in 2014. Remarkably, the Diversified E&P Peer Group — whose portfolios are roughly balanced between oil and gas — generated $14.10 per barrel of oil equivalent (boe) in profits in 2018, 7% higher than the $13.20/boe the group netted in 2014, when revenues were much higher. And with first-quarter 2019 oil prices rising 30% — the largest quarterly increase since 2009 — the industry appears to be on track for solid profitability again in 2019.