SM Energy Update - Nov 28

[dan_s]

I just posted an updated profile and forecast/valuation model for SM to our website.

SM has made a lot of progress this year. There balances sheet is now in good shape after some non-core asset sales. Well results in their Rockstar area in the Permian continue to be very strong.

SM produces a lot of high BTU natural gas that sells at a premium to Henry Hub prices. Their realized for gas in the 3rd quarter was $3.53/mcf. ~85% of their Q4 crude oil is hedged, so the recent pullback in oil prices will have very impact on their revenues.

This is a sizable company with over 125,000 Boepd of current production and they expect to increase production by 15% to 20% in 2019.

[ChuckGeb]

Isn’t the high gas price for Q3 because they don’t break out ngls?

[ChuckGeb]

Nope. Answered my own question. Price is for mcf only. Nice. I guess this is their Eagleford production.