Energy Prospectus

Here is what Stifel had to say about the company in this morning's report. As you can read below, there is a lot of news that will be coming with their Q4 report. Adding the Permian Basin as another core area of production growth is very important. - Dan

Matador Resources (MTDR-Buy, $19.71)
 Upbeat on first Wolfcamp well. Management appears very upbeat on
the Dorothy White #1, which is in the early stages of flowing back fluids
from the Wolfcamp A zone in Loving County, TX. Initial rates are likely
to be reported with 4Q13 results during the second week of March.
 Permian plan on track. Matador is currently drilling the lateral portion
of its first horizontal well in the Indian Draw prospect in Eddy County,
NM. The well will test the Wolfcamp B horizon. This year’s plan
contemplates 12 Permian Basin horizontals, including three in Indian
Draw, two in Wolf (excluding the Dorothy White), six in Ranger (southern
Lea County) and one in Twin Lakes (central Lea County). The latter will
be a vertical well drilled in late 3Q14. The Wolfcamp D appears to be
the best horizontal candidate at Twin Lakes, although horizontal drilling
in the area has been sparse.
 Efficiency driving Eagle Ford costs lower. Eagle Ford well costs
continue to decline due to efficiency gains. The company is routinely
completing 5,000 foot laterals on its western acreage (LaSalle County)
for less than $6 mn in part due to shorter drilling and mobilization times
experienced with a new Patterson walking rig.
 Borrowing base expansion soon. Management anticipates that an
upward revision to the $350 mn borrowing base on its line of credit will
be completed soon. The revision will be reported with 4Q13 results.

COVERAGE INITIATED: Matador Resources (MTDR) initiated by Northland Capital. Initial rating Outperform. 01/30 11:08 AM PT > $24