Utica/Marcellus condensate being produced at a MarkWest Energy processing plant in OH is being exported out of the country via a ship docked on a Hudson River port in New Jersey. So far, exported condensate which the gov ruled late last yr exempt from the export ban has come from terminals along the Gulf Coast fed by Texas oil fields The condensate is transported to NJ via railroad in specially designed rail cars.
The first ship loaded with 300,000 bbl of condensate left the port one month ago heading to the Netherlands. No word yet on where the second load is heading, but sources say exporting condensate from NJ is now set up to become a routine thing, which is fantastic news for drillers in Ohio, PA and WV that produce it.
What the heck is condensate? It’s a type of ultralight oil that’s flowing in huge quantities out of shale plays from Texas to Pennsylvania. When underground condensate is mostly a gas, but it condenses into a liquid when pumped to the surface.
The condensate exported from New Jersey is sourced from a stabilizer in Cadiz, Ohio. It is owned by MarkWest Energy Partners, which is being bought by Marathon Petroleum Corp .
in its latest market analysis dated Sep 24. The world’s safety cushion to compensate for sudden disruptions of global production is historically low, as Saudi Arabia’s spare crude production capacity stands at only 1.1 mm bbl/d.
Current spare capacity is far lower than the 2.1 million bpd of spare capacity the Kingdom held in 2009 when the oil market last demonstrated a significant mis-balance in supply and demand. Rystad Energy located in Norway is an O&G data firm offering consulting and research products.
There’s been too much emphasis on oversupply. “The market is very focused on oversupply, meanwhile the margin of error is small and it remains a volatile world,” says Ann Hittle at energy consultancy Wood. Mackenzie.
I read through his facebook postings too and found a visit to Ohio once a month. That may not be enough to micro manage a company but he may have confidence in the ability of his team to do the field work. Ha, he probably travels with an ipad computer regardless of where he’s vacationing. “Go to meeting” software provides people the chance to work from home nowadays.
Gary has filed registration statements with the SEC for 17 subsidiaries. There are also additional subsidiaries, such as Hunter Aviation and Hunter Real Estate, on the list attached to the 10-K but not registered. Unrestricted subsidiaries’ finances are not included with MHR on its balance sheet, and their financial status is not known. These subsidiaries may have funds available for MHR's use. A subsidiary’s cash flows and assets can be used to service the debt of the parent company as citied in “The Companies Act 2013” and explained by Ernest & Young LLP..
or was the Board saying, “Hey Gary, you NEED some help” when Yankowsky was hired? It appears a new position was created for him, shifting some of the responsibility for day to day operations off of Gary’s plate and onto Yankowsky’s plate
OPEC feels that the oil market is improving on higher demand for the commodity and a drop in supply growth from non-members.
A list of analysts predicting a price reversal is growing. A Sanford Bernstein & Co. survey of 160 investors in September showed the majority of respondents expected prices to rise by at least 19% during the next 12 months. Bernstein is an investment research firm.
“We believe the current price environment is on par with 2008/2009 and 1998/1999 in terms of severity,” said Bob Brackett. “In both cases, the rebound was significant. We believe oil prices are significantly below marginal cost and as they rise, E&Ps will benefit.”
MHR has hedged its nat gas and oil production to keep running smoothly until the EH sale and joint ventures are announced. Meanwhile, hedges – oil and gas sold for a locked in price – protect operating revenue and cash flow. "Also production companies have sharpened their ability to hold back NG and release it quickly when they can sell at a better price," writes Timothy Puko in a Sep 6 WSJ article. Efficiency gains (annual spuds per rig, avg stages per well, etc) have come more pronounced in the gas window than the oil and NGL window and have held costs down. Low cash costs, doing more with less, is the norm.
of nat gas because of a costless collar hedge. This means MHR will get $2.66 and will gain for every penny below $2.66. Based on current NG price at 2.49, MHR will get 0.17 more per MMBtu up to 80,000/d of gas produced. In Q2, MHR produced 126 MMcfe/d.
If anyone knows how to convert MMcfe to MMBtu, (one Mcf = 1.028 MMBtu is as far as I got)) you’ll know the amount of profit from the collar in Q2. Q2 production can be used as an estimate for the rest of the year (the collar is in effect thru Dec.) By the way, the collar ceiling is 3.15. The premium paid for this part of the collar is usually offset from premium earned for the call MHR sold, the other half of the costless collar.
PRC Williston is a subsidiary of MHR with acreage in N Dakota. The last 10-Q states MHR completed 100% ownership of PRC Williston, which isn’t a significant asset or liability at this time as it contains inactive wells. (post was deleted?)
PRC Williston LLC is a subsidiary of MHR that owns 154 inactive wells and acreage. I just read in the 10Q the subsidiary is not a significant asset or liability. Only the areas in the Williston Basin where MHR has active wells are of value.
Carley was basing her projections from interpretation of the chart pattern oil has followed over a certain timeframe. That's how she nailed the price of the decline.
She didn't give a date - just said ultimately she expects it to recover toward $62.50. IMO the price of oil is affected by geopolitical events, the economy and the weather - not easy to pin down a date!
Yes, conflicting reports today from Zachs, one says buy at 12:16 p.m., the other hold, no time given. Funny they changed their mind that quickly! Dakota reports 5 analysts have rated the stock a buy, 3 analysts a sell rating, and 9 have given a hold rating. MHR has an average rating of “Hold” and an average price target of $3.48.
I’ll rely on EIA’s report for natural gas to avg $3.11 per MMBtu in 2016. Evans said MHR can be profitable on $3.00 gas, and he has access to the data. I don’t have an opinion on specific dates, nor the price of oil. I’ve read various predictions re price for oil over $50. Carley Garner of DeCarley Trading correctly charted the drop in oil, and she expects oil to recover to 62.50. If it breaks 62.50, she thinks it will go to mid 70s or low 80s.