After missing last week’s update, I’m showing price changes
from the past two weeks below. There has
been quite a big sell off in E&P companies over the period, especially
those most exposed to natural gas, which was down almost 10% on the nymex. Brent crude also continued to sell off as
worries about Iraq supplies receded and Libyan production looks set to
increase. The Marcellus companies have been totally walloped, as has Chesapeake
and Southwestern, all quite dependent on gas sales.
The one bright spot has been Whiting, my biggest
position. The market cheered the
takeover of Kodiak at almost no premium.
The combined company should be able to realize efficiencies in their
drilling program and improve their return on capital. Kodiak has a much smaller acreage position
than Whiting, but much of it is very much in the core of the Bakken. I hope to do some posts on Kodiak/Whiting and
the Bakken in general over the next few days.
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