OAS
Re: OAS
2nd quarter production beat my forecast by over 2,000 boepd.
"Our team has exceeded all of our expectations during the first half of 2015, with production averaging over 50,000 Boepd and LOE trending below $8.50 per Boe year to date," said Thomas B. Nusz, Oasis' Chairman and Chief Executive Officer. "Production is ahead of schedule as we continue to see excellent performance from our high intensity completions along with high volume lift systems and reduced downtime. Lease operating expenses on a per barrel basis improved again sequentially with the benefit of growth in critical infrastructure. Oasis Midstream Services ("OMS") increased pipeline connections resulting in the amount of produced water flowing through our system to our disposal wells increasing significantly from 48% to 65% during the second quarter of 2015. Additionally, well costs continue to decrease as we optimize pad operations, improve drilling efficiency, and reduce the cost of source water with OMS infrastructure. Wells completed with slickwater in Indian Hills are now approximately $7.8 million, which is 13% lower than where they were in May 2015. Our team has done a tremendous job driving cost improvement through both efficiency gains and service cost reductions."
"We released a rig at the end of the second quarter, dropping down to three rigs running, as the team increased drilling efficiencies throughout the first half of the year," Mr. Nusz added. "By lowering drilling cycle times, we ended the second quarter with a backlog of wells drilled and not completed of 93, which was higher than originally planned. Given the current commodity backdrop, we have not changed our original completion plan of 79 gross (63.3 net) operated wells during 2015. With this pace of completions coupled with lower well costs, we are now planning on investing $670 million in CapEx during 2015 compared to our board approved budget of $705 million. Taking into consideration this completion program and improved operational performance, we are also increasing our production guidance range for the year from 46,000 to 49,000 Boepd up to 49,000 to 50,000 Boepd."
Michael Lou, Oasis' Chief Financial Officer also commented, "Based on operational performance and cost savings in the first half of 2015, we were cash flow positive in the second quarter and expect to be cash flow positive for the remainder of 2015. Our employees have done a great job of positioning Oasis to be able to grow within cash flow in the current pricing environment in the coming years."
"Our team has exceeded all of our expectations during the first half of 2015, with production averaging over 50,000 Boepd and LOE trending below $8.50 per Boe year to date," said Thomas B. Nusz, Oasis' Chairman and Chief Executive Officer. "Production is ahead of schedule as we continue to see excellent performance from our high intensity completions along with high volume lift systems and reduced downtime. Lease operating expenses on a per barrel basis improved again sequentially with the benefit of growth in critical infrastructure. Oasis Midstream Services ("OMS") increased pipeline connections resulting in the amount of produced water flowing through our system to our disposal wells increasing significantly from 48% to 65% during the second quarter of 2015. Additionally, well costs continue to decrease as we optimize pad operations, improve drilling efficiency, and reduce the cost of source water with OMS infrastructure. Wells completed with slickwater in Indian Hills are now approximately $7.8 million, which is 13% lower than where they were in May 2015. Our team has done a tremendous job driving cost improvement through both efficiency gains and service cost reductions."
"We released a rig at the end of the second quarter, dropping down to three rigs running, as the team increased drilling efficiencies throughout the first half of the year," Mr. Nusz added. "By lowering drilling cycle times, we ended the second quarter with a backlog of wells drilled and not completed of 93, which was higher than originally planned. Given the current commodity backdrop, we have not changed our original completion plan of 79 gross (63.3 net) operated wells during 2015. With this pace of completions coupled with lower well costs, we are now planning on investing $670 million in CapEx during 2015 compared to our board approved budget of $705 million. Taking into consideration this completion program and improved operational performance, we are also increasing our production guidance range for the year from 46,000 to 49,000 Boepd up to 49,000 to 50,000 Boepd."
Michael Lou, Oasis' Chief Financial Officer also commented, "Based on operational performance and cost savings in the first half of 2015, we were cash flow positive in the second quarter and expect to be cash flow positive for the remainder of 2015. Our employees have done a great job of positioning Oasis to be able to grow within cash flow in the current pricing environment in the coming years."
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: OAS
My valuation on OAS has gone up by $2.65/share to $22.65. Compares to First Call's target price of $16.21, which I am sure will be going up.
My forecast model will be posted to the EPG website this afternoon.
> 65% of 2H 2015 oil production is hedged at $75.61/bbl
> LOE expense has come way down
> Production forecast going up and capex budget going down.
> OAS will be cash flow positive, even if oil stays at current level
OAS was written off as dead, but it has a solid balance sheet, plenty of liquidity and a ton of upside even if oil only rebounds to $60/bbl in 2016.
Cash flow per share this year will be over $4.50, so the current share price is ridiculous.
IMO Oasis is a Screaming Takeover Target.
My forecast model will be posted to the EPG website this afternoon.
> 65% of 2H 2015 oil production is hedged at $75.61/bbl
> LOE expense has come way down
> Production forecast going up and capex budget going down.
> OAS will be cash flow positive, even if oil stays at current level
OAS was written off as dead, but it has a solid balance sheet, plenty of liquidity and a ton of upside even if oil only rebounds to $60/bbl in 2016.
Cash flow per share this year will be over $4.50, so the current share price is ridiculous.
IMO Oasis is a Screaming Takeover Target.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: OAS
Oasis Petroleum (OAS) was up more than 17% in Thursday afternoon trading, following an upgrade from Wunderlich on the heels of its mixed second-quarter earnings.
U.S. Department of Energy
Analysts Irene Haas and Vedran Vuk upgraded the shares from Hold to Buy and increased their price target by $3, to $14.
They write that the company’s production came in above guidance for the third straight quarter, so while revenues were below consensus, EPS, cash flow per share and EBITDA were above expectations. They also applaud lower lease operating expense costs and write that the company “continues to get better on all fronts with each quarter.”
Read: http://blogs.barrons.com/stockstowatcht ... s&ru=yahoo
U.S. Department of Energy
Analysts Irene Haas and Vedran Vuk upgraded the shares from Hold to Buy and increased their price target by $3, to $14.
They write that the company’s production came in above guidance for the third straight quarter, so while revenues were below consensus, EPS, cash flow per share and EBITDA were above expectations. They also applaud lower lease operating expense costs and write that the company “continues to get better on all fronts with each quarter.”
Read: http://blogs.barrons.com/stockstowatcht ... s&ru=yahoo
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group