HK
Re: HK
Investor love hedges when the oil & gas prices are going down and the hate them when commodity prices are going up.
There is not much that Halcon can do about the hedges except ride them out and keep growing production. If they hit the midpoint of their production guidance for 2018 (~17,500 Boepd), this one has a lot of upside for us.
Note that the natural gas price that I am using in their forecast is way too low now that ngas prices have firmed up.
There is not much that Halcon can do about the hedges except ride them out and keep growing production. If they hit the midpoint of their production guidance for 2018 (~17,500 Boepd), this one has a lot of upside for us.
Note that the natural gas price that I am using in their forecast is way too low now that ngas prices have firmed up.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: HK
On May 2nd this is what they said:
Floyd C. Wilson commented "Our revised 2018 guidance includes the impact of our recently acquired West Quito properties and the addition of a fourth rig in May. It's important to note that our revised 2018 production guidance assumes we don't bring a second spot frac crew in until Mid-August of 2018. This timing results in back-end weighted production growth for us in 2018 with a fourth quarter production rate expected to be around 24,000 boe/d. This sets us up nicely as we head into 2019. I also want to emphasize that our 2018 drilling plan consists of almost entirely long laterals in excess of 9,000 feet. Although long lateral development results in longer cycle times, long laterals are a more capital efficient way to develop assets over the long-run. We are well positioned to withstand any takeaway issues in the Permian through 2019 with takeaway contracts in place for oil and gas. We are evaluating ways to create value and have options available to us including joint venture and infrastructure divestiture opportunities. We continue to focus on execution and efforts to control costs while optimizing drilling and completion programs."
Net of cash settlements on their hedges, Halcon got $54.52/bbl for their oil in Q1. I am forecasting that the will get high $50's per barrel for their oil this year (net of cash settlements on hedges).
Floyd C. Wilson commented "Our revised 2018 guidance includes the impact of our recently acquired West Quito properties and the addition of a fourth rig in May. It's important to note that our revised 2018 production guidance assumes we don't bring a second spot frac crew in until Mid-August of 2018. This timing results in back-end weighted production growth for us in 2018 with a fourth quarter production rate expected to be around 24,000 boe/d. This sets us up nicely as we head into 2019. I also want to emphasize that our 2018 drilling plan consists of almost entirely long laterals in excess of 9,000 feet. Although long lateral development results in longer cycle times, long laterals are a more capital efficient way to develop assets over the long-run. We are well positioned to withstand any takeaway issues in the Permian through 2019 with takeaway contracts in place for oil and gas. We are evaluating ways to create value and have options available to us including joint venture and infrastructure divestiture opportunities. We continue to focus on execution and efforts to control costs while optimizing drilling and completion programs."
Net of cash settlements on their hedges, Halcon got $54.52/bbl for their oil in Q1. I am forecasting that the will get high $50's per barrel for their oil this year (net of cash settlements on hedges).
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group