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nu awlins ag
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In reply to one MEEN Ag • 1:17p, 2/15/24
AG
one MEEN Ag said:
nu awlins ag said:
"IEA and OPEC are engaged in a battle of the experts, but the market always gives more credence to OPEC since this is the group that actually produces and trades oil, and therefore has better market insight," Manish Raj, managing direct at Velandera Energy Partners, told CNBC.


For those concerned with supply/demand for 2024. I believe the IEA is always more politically driven than anyone else.
At its base level, IEA doesn't gain anything by reporting accurately and doesn't suffer any consequences for being wrong. Your supermajors have their own internal models and trackers, your minor players are beholden to the price makers in trading and just use the commodity prices.

OPEC is incentivized to push numbers that increase the price of oil. IEA is incentivized to push numbers that decrease the price of oil. Being in oil is like being a landlord, whats good for you isn't seen as whats good for the largest swath of lowest information voters. Everyone always talks their book. IEA is allowed to be wrong in ways that reduce oil prices.


Well, I have spread sheet covering 10 years that points in a more political direction is terms of their weekly reporting. You can't and shouldn't be that off like they are. If my estimates were that off, I wouldn't have a job. OPEC protects their own but their numbers a way more valid than the IEA's numbers. You can't be wrong 63% of the time on your estimates. Traders use this as a signal as I'm sure you know. I trust the data from OPEC more than the IEA.
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one MEEN Ag
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In reply to nu awlins ag • 1:50p, 2/15/24
AG
Oh you need to get on twitter. IEA reports get blasted every thursday when they come out. Lots of comments showing the exact same thing you're saying. That they have gotten progressively worse when its been progressively convenient. They hide behind condensate blending as the reason but then have done some new funny business in their 'fix' that makes numbers better than they are. Something about double counting barrels. I haven't followed that new fix closely so if anyone knows more please share.
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nu awlins ag
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In reply to one MEEN Ag • 1:56p, 2/15/24
AG
one MEEN Ag said:
Oh you need to get on twitter. IEA reports get blasted every thursday when they come out. Lots of comments showing the exact same thing you're saying. That they have gotten progressively worse when its been progressively convenient. They hide behind condensate blending as the reason but then have done some new funny business in their 'fix' that makes numbers better than they are. Something about double counting barrels. I haven't followed that new fix closely so if anyone knows more please share.


I don't do twitter, and as a semi retired guy, I don't really care. They have been bad for longer than that, as my data shows. Thanks for the insight, maybe I'll check them out! Nothing but a political hack organization now along with a few big commodity companies I follow. Just follow the intel…..I mean bread crumbs and you'll see.
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Furlock Bones
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1:10p, 2/20/24
AG
NG continues to be a bloodbath.
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MAROON
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In reply to Furlock Bones • 1:29p, 2/20/24
AG
rigs have got to start falling off in that sector.
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Cyp0111
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In reply to MAROON • 1:43p, 2/20/24
I've been saying for a year now, the carry in the market is really distorting decisions. Seeing some smaller producers hedging 3-4 years out at flat price to bring forward some of the carry. Selling the future to stay solvent.
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MAROON
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In reply to Cyp0111 • 3:17p, 2/20/24
AG
RBC Richardson Barr : News & Research

CHK cutting CAPEX by 20% from previous announced budget, cutting rigs and deferring bringing wells into production..
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nu awlins ag
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In reply to Furlock Bones • 3:59p, 2/20/24
AG
Furlock Bones said:
NG continues to be a bloodbath.


Thanks to an administration that knows absolutely nothing about the O&G industry and any industry for that matter. They are only concerned with power, which should scare the hell out of people. Politics aside, do what's best for the country and national security and economy. It's not that hard…
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Chef Elko
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4:13p, 2/20/24
AG
Thanks CHK!
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Cyp0111
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In reply to nu awlins ag • 5:21p, 2/20/24
My man, current bloodbath has nothing to do with admin. Everything to do with 2 warm winters and record production thanks to Haynesville bois thinking they're the marginal swing mcf when that asset is best housed in a major and swing optionality in considerably higher markets.

The pure play Haynesville value is minimal outside of that integration value to an international LNG buyer like TGE.
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Chef Elko
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6:51p, 2/20/24
AG
Not everyone is working at Chevron or Exxon or in some boutique IB/consulting/law firm so we applaud CHK curtailing production and giving us life.

Napkin math looks like CHK could cut storage surplus in half. Looking like 700mmcf/d or so just from their initial figures. Tune in to the call tomorrow morning for the 1 million analyst questions haha. What will EQT production figures look like after this news? SWN reporting Thursday, hmmmm. This was really the first big domino to fall.

Strip is popping but where will it close tomorrow? I think we hold the gains but every pop has been sold off.
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nu awlins ag
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In reply to Cyp0111 • 8:26a, 2/21/24
AG
Cyp0111 said:
My man, current bloodbath has nothing to do with admin. Everything to do with 2 warm winters and record production thanks to Haynesville bois thinking they're the marginal swing mcf when that asset is best housed in a major and swing optionality in considerably higher markets.

The pure play Haynesville value is minimal outside of that integration value to an international LNG buyer like TGE.


Ok…
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Sims
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8:51a, 2/21/24
AG
This may have been covered but maybe you guys can indulge me in the case of a rehash from anyone with specific knowledge. Is there a clear path/timeline forward with folding pxd into xom?

Context of the question is I'm a custom fabricator for both with a significant history with pxd. We have many new faces from xom that we're speaking with but I'd like to facilitate a conversation between our CEO and someone who would appreciate a conversation with higher level strategy and longer time window in mind.

It probably makes sense to wait and let that process play out so that we can identify the correct people but if we can do that sooner than later, I would certainly appreciate the help! So far I'm just sitting back and watching people take separation packages even though I thought they may have been "the guy." I also fully expect some, take a number, you and everyone else are interested replies and I deserve that for asking
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Cyp0111
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In reply to nu awlins ag • 8:58a, 2/21/24
You may not like this but the LNG pause has nothing to do with next 24 month pricing, maybe some weakness in the backs and basis out the curve.

Can blame the admin as it is easy but the fact is you have companies like Comstock and Aethon etc. all running rigs on swing volumes in the Haynesville at sub economic near term pricing chasing and in part crashing the forward market.

I've said the carry in the market is the death nail to natty.

Marcellus is what it is but you're seeing privates pull back out of necessity (solvency) and if prices pull down in 24/25, you will see the big guys. For an IG balance sheet, EQT has a lot of risk there 12 months forward if prices do not behave.

The fact remains that only two of the publics have announced any form of restraint (AR, CHK) with CHK being the only meaningful cut.
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sts7049
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In reply to nu awlins ag • 9:32a, 2/21/24
AG
nu awlins ag said:
Cyp0111 said:
My man, current bloodbath has nothing to do with admin. Everything to do with 2 warm winters and record production thanks to Haynesville bois thinking they're the marginal swing mcf when that asset is best housed in a major and swing optionality in considerably higher markets.

The pure play Haynesville value is minimal outside of that integration value to an international LNG buyer like TGE.


Ok…
feel free to elaborate on what admin decisions have specifically contributed to the current price environment
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MAROON
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In reply to Cyp0111 • 9:32a, 2/21/24
AG
Comstock has also dropped two rigs and stopped their dividend.
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LRHF
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9:38a, 2/21/24
AG
Current admin definitely hates you guys BUT…. The current problems are self induced. We've done this to ourselves since Thanksgiving Day 2014 (at least with regards to the last major down cycle).

LRHF
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Ag CPA
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10:02a, 2/21/24
AG
If prices stay depressed the real fun for NG producers starts in 9-12 months when the hedges roll off.
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Cyp0111
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In reply to MAROON • 10:40a, 2/21/24
Looking at Comstocks latest presentation. I do not know if their credit agreement covenant is Secured Debt or Total Debt when calculating the Leverage Ratio.

If it is total debt, they have a 2.9x as of FYE 23 and imagine EBITDA is going to be further impacted this year and could have a real issue on their hand in 25 if prices do not recover.

I say that as the availability of the revolver which is the main source of liquidity with only $17MM cash on hand could become a real issue.


If the calculation is only Secured Debt/ LTM EBITDA, they have running room but imagine they're going to need to further curtail capex.

Tough to see any scenario where that divy comes back in mid/near term.
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Dreigh
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10:43a, 2/21/24
The beautiful thing about America is anyone with the resources can go drill a gas well.

The terrible thing about America is anyone with the resources can go drill a gas well.
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Furlock Bones
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In reply to Cyp0111 • 1:26p, 2/21/24
AG
If they draw that revolver, it's to position themselves for ch 11.
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Cyp0111
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In reply to Furlock Bones • 1:42p, 2/21/24
Agree- been there, done that, got the prize (err Kirkland bill).


I'm not going to spend time in one of their filings to try and find the credit agreement or covenant calc but I expect most leverage ratios these days to be Total Debt after the mid 2010's and the OCC.

If that is the case, they're pretty illiquid if you dont continue to drop capex and turn to atleast cf neutral, that is still a ton of risk unhedged into 2025.
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Ag CPA
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2:50p, 2/21/24
AG
CHK announces intent to cut production and NG jumps 12%.
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Cyp0111
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In reply to Ag CPA • 2:52p, 2/21/24
Yes, now you need some of the privates (that's happening bc credit) and big public's to pull back.
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nosoupforyou
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7:00p, 2/21/24
AG
Thought Devon bought them… but nope!


https://www.prnewswire.com/news-releases/chord-energy-and-enerplus-to-combine-in-11-billion-transaction-creating-premier-williston-focused-ep-company-with-top-tier-shareholder-returns-302068077.html
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Chewy
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In reply to Sims • 6:30a, 2/22/24
AG
Sims said:
This may have been covered but maybe you guys can indulge me in the case of a rehash from anyone with specific knowledge. Is there a clear path/timeline forward with folding pxd into xom?

Context of the question is I'm a custom fabricator for both with a significant history with pxd. We have many new faces from xom that we're speaking with but I'd like to facilitate a conversation between our CEO and someone who would appreciate a conversation with higher level strategy and longer time window in mind.

It probably makes sense to wait and let that process play out so that we can identify the correct people but if we can do that sooner than later, I would certainly appreciate the help! So far I'm just sitting back and watching people take separation packages even though I thought they may have been "the guy." I also fully expect some, take a number, you and everyone else are interested replies and I deserve that for asking
Can't comment directly but used to work for a large O&G equipment company with XOM as a customer.

I think you're just going to have to wait this one out unless you get lucky and find the right person that knows what their role is and is sticking around.

My guess is no matter what is stated publicly there's no clear integration plan. Lots of people sitting around wondering their future roles. Because of that, they're not going to take much initiative with an external supplier. They're focused internally on their future.

Have an in-law that works for XOM in the Permian. Was talking to their Father in Law over Christmas and sounded like they hadn't been communicated much. Two months later I'm going to guess that hasn't changed.

I have other friends at other major operators. Some of the feeling I get from them is there's a big state of flux as a whole. You have older folks trying to figure out if they're going to work 6 months or 5+ years depending on what gets offered to them.

Meanwhile, you have lots of younger folks getting promoted that aren't quite ready for it and just trying to get their head above water.

Lots of generalization there but that's what I've seen and currently hear with my limited data set.

Maybe you'll get lucky and find the right horse. If not, just sit back and enjoy a mint julep while you watch the horses position themselves while staying as relevant as you can to both parties.
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Furlock Bones
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In reply to Chewy • 8:03a, 2/22/24
AG
this. i talked to a counterpart at Pioneer 2 weeks ago, and they had no idea what the future was just yet.
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Maverick06
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In reply to Furlock Bones • 8:33a, 2/22/24
AG
This. There are maybe a handful of people at PXD that know their future with XOM. I'd go so far as to say they only know they have a job and don't know what that job is at this point. My contacts there have said it's radio silence.
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Jbob04
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In reply to Cyp0111 • 9:02a, 2/22/24
AG
Comstock is steady punching new holes in my county. They are blowing and going right now and still have several pads built and ready for a rig.
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Cyp0111
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In reply to Jbob04 • 9:13a, 2/22/24
Yah, it's just poor mgmt and fiduciary to shareholders at this point. If that leverage ratio is total debt, they're insolvent with current capex. Cutting the divvy is triage.
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Swollen Thumb
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In reply to nosoupforyou • 9:36a, 2/22/24
AG
nosoupforyou said:
Thought Devon bought them… but nope!


https://www.prnewswire.com/news-releases/chord-energy-and-enerplus-to-combine-in-11-billion-transaction-creating-premier-williston-focused-ep-company-with-top-tier-shareholder-returns-302068077.html

Big move. Didn't see this coming as they have been touted as the obvious player for Grayson. Assume that's no longer the case?
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MAROON
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In reply to Cyp0111 • 9:49a, 2/22/24
AG
Their leverage ratio is basically Total net debt to EBITDAX.
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Cyp0111
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10:37a, 2/22/24
So, they're essentially insolvent in 12 months if they don't cut capex or if prices dip in 25.

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MAROON
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In reply to Cyp0111 • 10:56a, 2/22/24
AG
they have already cut CAPEX from $1.2bil (2023 actual) to $850mil (2024 budget). I assume they can cut further if prices stay this low. But yes, if prices continue to be this low and their higher prices hedges roll off they would have a problem.
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Comeby!
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11:16a, 2/22/24
AG
Well they may have drilling obligations. They may DUC these wells. You don't just shut down in a day. Lads are build, title run, frac crews scheduled or contracted.
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