SM Energy Maintains Borrowing Base -- April 16, 2015

From Yahoo!In-Play:

SM Energy announces that Q1 production is expected to be 16.8 MMBOE, or 186.4 MBOE/d; borrowing base maintained at $2.4 bln : Co announces that production for the first quarter of 2015 is expected to be 16.8 MMBOE, or 186.4 MBOE/d. This represents 6% sequential growth in average daily production from the fourth quarter of 2014, and exceeds the Company's guidance.

The Company also announces that the borrowing base under its senior secured revolving credit facility was maintained at $2.4 billion following its lenders' regularly scheduled semi-annual redetermination. SM Energy has elected to leave the aggregate commitment amount from the bank group unchanged at $1.5 billion. The redetermination was made under the terms of the existing facility and there were no other changes to the terms of the credit facility resulting from this borrowing base redetermination.

Another company maintains borrowing base, keeping with the story line. See tag. 

Also from Yahoo!In-Play:

Schlumberger beats by $0.15, reports revs in-line; co further reduces headcount: Reports Q1 (Mar) earnings of $1.06 per share, excluding non-recurring items, $0.15 better than the Capital IQ Consensus Estimate of $0.91; revenues fell 8.8% year/year to $10.25 bln vs the $10.35 bln consensus.

• Co's Q1 revenue decreased 19% sequentially driven by the severe decline in North American land activity and associated pricing pressure. International operations were impacted by reduced customer spend in addition to seasonal effects in the Northern Hemisphere and the fall in value of the Russian ruble and the Venezuelan bolivar. Three-quarters of the overall sequential decline was due to lower activity and pricing, while the remainder was the result of currency effects and non-recurring year-end sales.
• "Despite the severity of the sequential revenue decline, we have been able to minimize its impact on our margins through prompt and proactive cost management as well as through acceleration of our transformation program across product lines and GeoMarkets. These actions have successfully improved financial performance compared to previous industry cycles, with an overall sequential decremental operating margin of 33% as North America and the International Areas reported 39% and 25%, respectively.
• "The largest drop in E&P investment is occurring in North America, where 2015 spend is expected to be down by more than 30%. We believe that a recovery in US land drilling activity will be pushed out in time, as the inventory of uncompleted wells builds and as the re-fracturing market expands. We also anticipate that a recovery in activity will fall well short of reaching previous levels, hence extending the period of pricing weakness."
• As a result of the severe fall in activity in North America combined with the impact of lower international activity due to customer budget cuts driven by lower oil prices, Schlumberger took the decision to further reduce its headcount by approx. 11,000 employees.

Oasis Maintains/Increases Borrowing Base At Mid-Year Redetermination -- April 14, 2015

From a press release:

Oasis Petroleum Inc. today announced that the lenders under its revolving credit agreement completed their regular semi-annual redetermination of the borrowing base, resulting in a borrowing base of $1,700 million.  The Company increased the lenders' aggregate elected commitment to $1,525 million from $1,500 million.  The lenders' aggregate commitment can be increased to the full $1,700 million borrowing base by increasing the commitment of one or more lenders. 

Additionally, the Company extended the maturity date of the facility from April 2018 to April 2020, provided that the Company's 2019 Senior Notes are retired or refinanced 90 days prior to the maturity of the 2019 Senior Notes.  Oasis' borrowing base facility is supported by 18 financial institutions.  The next redetermination of the borrowing base is scheduled for October 1, 2015.

This is so cool. Fits the story line that was first posted some weeks ago. 

A thank you to Don for this link as well as the link regarding EOG's share of the 900 wells waiting to be fracked.

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Very, Very Interesting -- Saudi Arabia Watching With Anxiety

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

From Seeking Alpha:

• The price of oil will recover but not back to triple-digits, Citigroup says, leading the firm to recommend ConocoPhillips, Devon Energy, Total, and Statoilwhile downgrading BP.
• Many companies have not left enough headroom to deal with a lower oil price environment after the hot pursuit of growth in recent years, the firm says, believing those most challenged in the new paradigm are players focused on liquefied natural gas and heavy oil, as well as most of the big oil names.
• Citi says “shale is the core of the survivors' party,” and that investors can get "good value exposure” by buying COP and DVN; self-help also will be part of surviving $60-$75 oil, pointing to TOT and STO as having the most potential.
• The firm cuts BP to Neutral because it thinks all its potential self-help has been priced into the stock.

Saudi won't do well on $60 oil. 

Monday, April 13, 2015

Active rigs:

	4/13/2015	04/13/2014	04/13/2013	04/13/2012	04/13/2011
Active Rigs	93	189	186	208	173

RBN Energy: five Marcellus / Utica midstream players.

MarkWest Energy Partners is clearly the big dog in the Marcellus/Utica, with by far the largest gas processing and fractionation capacity there. But several other significant players in the region--Blue Racer Midstream, Utica East Ohio Midstream, Williams Partners and Pennant Midstream among them—have also been developing the region’s midstream infrastructure, enabling producers to ramp up their output of natural gas and NGLs. Today we continue our review of NGL-related assets in the Upper Ohio River Valley with a look at five additional midstream companies in the hunt. 

Producer interest in the Marcellus in southwestern Pennsylvania and northern West Virginia and in the Utica in eastern Ohio has been rising quickly since 2011--and it’s expected to continue as more take-away capacity for natural gas and NGL comes online, offering producers access to markets as far away as Texas. In our series on the region’s NGL-related infrastructure, we’ve describe the region’s history and hydrocarbon potential generally (in Episode 1) and in more detail (Episode 2). 

Next, (in Episode 3) we discussed the eight major pipelines that move natural gas through and out of the region; considered the gas processing and fractionation assets of MarkWest (Episode 4 and Episode 5); and described the pipeline interconnections between MarkWest’s eight (and soon nine) gas/NGL complexes in the region—and then explained how the elements of MarkWest’s “machine” are designed to function efficiently, even in the event of NGL-takeaway disruptions (Episode 6). In our last blog in this series, we started our look at other providers of midstream services in the Marcellus/Utica by considering the assets of Blue Racer, a joint venture of Caiman Energy II and Dominion (Episode 7). This time, we look at the remaining players in the region and list their gas processing plants, fractionators, and NGL pipelines that link those facilities to the outside world.

In addition to its 49% stake in UEO (thanks to its February 2015 merger with Access Midstream), Williams Partners owns 100% of Appalachian Midstream, which operates (and owns between one-third and two-thirds of) 11 natural gas gathering systems in the Marcellus—some in the dry-gas part of the Marcellus in northeastern Pennsylvania and some in the wet-gas part in southwestern Pennsylvania and northern West Virginia. Appalachian Midstream also owns the gas processing plants and pipelines shown in the southeastern part of Figure #1 [at the linked article]. The company’s 700 MMcf/d of gas processing capacity is split between two sites in Marshall County, WV--500 MMcf/d at Fort Beeler and 200 MMcf/d at Oak Grove—that together can produce up to 87 Mb/d of mixed, y-grade NGLs (blue dots). Its fractionation assets include a 40 Mb/d de-ethanizer at Oak Grove (green dot); the residual mixed NGLs then is fractionated at Williams’ 42 Mb/d C3+ fractionator at Moundsville—also in Marshall County (orange dot). Ethane separated out at Oak Grove is delivered to market via Williams’ 50-mile, 12-inch-diameter Ohio Valley Ethane Pipeline (OEVP, green line) from Oak Grove to MarkWest’s NGL hub at Houston, PA (shown in black since it is not owned by UEO). From there, ethane can flow into Mariner East, Mariner West and/or ATEX. 

We should note that Williams Partners holds a 58% stake in Caiman II, which owns half of Blue Racer. In Episode 7 we covered how Blue Racer moves ethane from its Natrium complex to Oak Grove via a 15-mile (Blue Racer-owned) ethane-only pipeline, and that from there the ethane moves to Houston (PA) via Williams’ OEVP.

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NOG

NOG press release: Northern Oil and Gas, Inc. today announced that its bank syndicate group reaffirmed and maintained the existing $550 million borrowing base under Northern's revolving credit facility during the semi-annual redetermination period.

Comment: this is in-line with earlier posts on "redeterminations."