Equinor ASA EQNR recently announced that the company has found oil in the Monument exploration well, located in the central U.S. Gulf of Mexico (GoM). This is the company’s first operated exploration well in the region in the last five years.
The exploration well was drilled with the help of the Pacific Khamsin rig at a water depth of 10,164 meters. It encountered around 60 meters of net oil pay, which provides early indications of the productive reservoir, belonging to the Paleogene sandstone. The company plans further appraisal drillings at the site to gauge the full potential of the finding.
Notably, the firm has significant upstream activities in the United States, which are managed from the Houston, TX office. It is a partner in nine producing fields in the GoM. The company’s output from the region is around 130 thousand barrels of oil equivalent per day. The metric is expected to grow further in the coming days, which can make Equinor one of the top five producers in the region during this year. Moreover, the Norwegian energy firm has invested in the country’s growing offshore wind industry, and has projects in both East and West coasts.
While Equinor holds a 50% operating stake in the prospect, Petronas’ subsidiary Progress Resources and Spanish energy giant Repsol, S.A. REPYY have 30% and 20% interests, respectively. Notably, this marks the first discovery of Petronas in the GoM region as well.
The stock has plunged 34.5% year to date compared with 28.3% fall of the industry it belongs to.
Zacks Rank & Stocks to Consider
Currently, Equinor has a Zacks Rank #3 (Hold). Some better-ranked stocks in the energy sector are Murphy USA Inc. MUSA and Covanta Holding Corporation CVA, each sporting a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Murphy USA’s bottom line for 2020 is expected to rise 7.7% year over year.
Covanta Holding beat earnings estimates thrice in the last four quarters, with the average positive surprise being 55%.
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