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India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Equities flat WoW while oil and gas
diverge in opposite directions
Energy Market Indices WoW Changes
⇒ S&P/TSX Energy Index: +0.3%
⇒ S&P 500 E&P Index: -0.3%
⇒ Oil Service Sector Index: -1.4%
⇒ UK FTSE Oil & Gas Producers Index: +0.5%
⇒ Asia Pacific Oil & Gas Producers Index: +1.6%
Weekly Market Recap
Last week, the Government of Alberta released its draft of the Lower Athabasca Integrated
Regional Plan which proposed to increase the conservation area in the region by more than
5m acres to 22% (from 6%) of the total area within the Lower Athabasca region of Alberta.
Although headline grabbing, there is negligible impact to our Oil Sands coverage universe
as a result of this announcement. The majority of leased projects are either outside the
defined scope of the conservation areas or are in areas not expected to be developed.
Surge Energy (SGY CN; O; TP: C$11.50) announced two acquisitions focused within
Bottineau County of North Dakota. Surge paid C$21.5m in cash to acquire 100bbl/d (100%
oil), and 6,000 net acres of land, which is prospective for 205 (120 net) Spearfish horizontal
development locations. To close the week, Western Energy Services (WRG CN; not rated)
entered into an agreement to purchase Stoneham Drilling (SDG-U CN; not rated) for C$24
per share in cash, or 61.538 Western common shares and Paramount (POU CN, not rated)
announced its intent to buy ProspEx (PSX CN; not rated) for C$180m in cash or shares.
Last week, members of our research team went on an investor trip to Poland to visit
Aurelian Oil & Gas (AUL LN; 72p; O; TP: 130p), FX Energy (FXEN US; US$9.02, O; TP:
US$15.00), Realm Energy (RLM CN; C$0.83, not rated), and BNK Petroleum (BKX CN;
C$5.74, O; TP: C$6.75). The official government line is clearly one of domestic gas
production growth being a strategic imperative. The unconventional gas plays we visited,
which aim to contribute to this production growth, are still at an early stage in terms of
definitive commerciality but the geology, services and regulatory environment are all
looking encouraging. It was also encouraging to see visible signs of a buoyant economy
in Poland (road construction, new houses everywhere, warehouses and factories).
In separate news, BP agreed to the sale of ARCO Aluminium to a conglomerate of
Japanese companies for US$680m and BG Group announced a third gas discovery
offshore Tanzania. In the European E&P Universe, Cairn Energy agreed to push back the
deadline to complete the Cairn India transaction with Vedanta due to ongoing delays to
approval from Indian authorities. Lundin Petroleum announced an oil discovery at the
Tellus prospect offshore Norway and Valiant Petroleum reported FY10 results with
increased 2011 production guidance.
This week, we have we have updated our commodity assumptions and our forecasts to
account for mark-to-market 1Q11 pricing. The marking to market has no impact on our
annual crude price forecasts while our natural gas forecast decreases US$0.14/mmbtu to
US$4.26/mmbtu.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Equities flat WoW while oil and gas
diverge in opposite directions
Energy Market Indices WoW Changes
⇒ S&P/TSX Energy Index: +0.3%
⇒ S&P 500 E&P Index: -0.3%
⇒ Oil Service Sector Index: -1.4%
⇒ UK FTSE Oil & Gas Producers Index: +0.5%
⇒ Asia Pacific Oil & Gas Producers Index: +1.6%
Weekly Market Recap
Last week, the Government of Alberta released its draft of the Lower Athabasca Integrated
Regional Plan which proposed to increase the conservation area in the region by more than
5m acres to 22% (from 6%) of the total area within the Lower Athabasca region of Alberta.
Although headline grabbing, there is negligible impact to our Oil Sands coverage universe
as a result of this announcement. The majority of leased projects are either outside the
defined scope of the conservation areas or are in areas not expected to be developed.
Surge Energy (SGY CN; O; TP: C$11.50) announced two acquisitions focused within
Bottineau County of North Dakota. Surge paid C$21.5m in cash to acquire 100bbl/d (100%
oil), and 6,000 net acres of land, which is prospective for 205 (120 net) Spearfish horizontal
development locations. To close the week, Western Energy Services (WRG CN; not rated)
entered into an agreement to purchase Stoneham Drilling (SDG-U CN; not rated) for C$24
per share in cash, or 61.538 Western common shares and Paramount (POU CN, not rated)
announced its intent to buy ProspEx (PSX CN; not rated) for C$180m in cash or shares.
Last week, members of our research team went on an investor trip to Poland to visit
Aurelian Oil & Gas (AUL LN; 72p; O; TP: 130p), FX Energy (FXEN US; US$9.02, O; TP:
US$15.00), Realm Energy (RLM CN; C$0.83, not rated), and BNK Petroleum (BKX CN;
C$5.74, O; TP: C$6.75). The official government line is clearly one of domestic gas
production growth being a strategic imperative. The unconventional gas plays we visited,
which aim to contribute to this production growth, are still at an early stage in terms of
definitive commerciality but the geology, services and regulatory environment are all
looking encouraging. It was also encouraging to see visible signs of a buoyant economy
in Poland (road construction, new houses everywhere, warehouses and factories).
In separate news, BP agreed to the sale of ARCO Aluminium to a conglomerate of
Japanese companies for US$680m and BG Group announced a third gas discovery
offshore Tanzania. In the European E&P Universe, Cairn Energy agreed to push back the
deadline to complete the Cairn India transaction with Vedanta due to ongoing delays to
approval from Indian authorities. Lundin Petroleum announced an oil discovery at the
Tellus prospect offshore Norway and Valiant Petroleum reported FY10 results with
increased 2011 production guidance.
This week, we have we have updated our commodity assumptions and our forecasts to
account for mark-to-market 1Q11 pricing. The marking to market has no impact on our
annual crude price forecasts while our natural gas forecast decreases US$0.14/mmbtu to
US$4.26/mmbtu.
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