| | | Beach Energy Limited (BPT.AX), National Oilwell Varco (NOV), Precision Drilling Corporation (PDS),
Range Resources Corp (RRC), Saipem (SPMI.MI), Subsea 7 S.A. (SUBC.OL),
Talisman Energy Inc. (TLM), Level 3 sectoral sanctions on Russia?
Beach Energy Limited (BPT.AX)
Good Jun-Q result, but FY15 production guidance a little weak
29 July 2014 ¦ 14 pages ir.citi.com
National Oilwell Varco (NOV)
On Track with Expectations
29 July 2014 sendspace.com
Precision Drilling Corporation (PDS)
Strong Execution and Expansion
28 July 2014 sendspace.com
Range Resources Corp (RRC)
Q2’14 Results: Many Moving Parts; Bottom-Line Estimates Fall
29 July 2014 ¦ 10 pages ir.citi.com
Citi's Take – Range reported recurring Q2’14 EPS/CFPS of $0.36/$1.53, below our
$0.46/$1.61 estimates and Consensus of $0.44/$1.69. Total production came in
above our forecast and the top-end of guidance but this was driven by much higher-
than-expected natural gas volumes while oil/liquids production (33% of the mix vs.
guidance of 30-35%) was below our projections. Also, NGL price realizations were
well below our forecast (24% of WTI vs. our 28% estimate). The lower liquids mix
and NGL price realizations were largely due to unplanned plant and pipeline
outages during the quarter. These more than offset lower-than-projected per-unit
costs across the board with per-unit LOE below the low-end of guidance.
Saipem (SPMI.MI)
Broad targets set
30 July 2014 sendspace.com
Still rated Underperform
Subsea 7 S.A. (SUBC.OL)
Confidence booster required
30 July 2014 sendspace.com
Talisman Energy Inc. (TLM)
Slow Progress On Transition... Downgrade to Neutral
30 July 2014 sendspace.com
Level 3 sectoral sanctions on Russia?
Alert: New US/EU sanctions on Russia impact short- & long-term
energy prospects; persistent Russia/West tensions to continue
29 July 2014 ¦ 6 pages ir.citi.com
The impact on energy should be minimal in the short term, but could be
significant in the long term. Energy sector sanctions may include previously
touted "scalpel sanctions" limiting high-technology transfers which could affect
Arctic, deep water, and shale/tight oil development in Russia; technologies related
to LNG would also be impactful, but may not yet be targeted given European
sensitivity to sanctions on Russia’s gas sector. Thus, high-technology energy
projects could be delayed, meaning declining oil production at mature fields may not
be replaced as easily. Near-term oil supplies should not be affected. To clarify, these
are not sanctions on oil sales/payments/SWIFT which would affect Russian
hydrocarbons exports.
A multi-year low in natural gas prices may have made European decision-
makers more sanguine about the ability of Europe to withstand a gas-halting
standoff with Russia, but if Jack Frost shows up this year, natural gas prices
in Europe could yet spike. Although European gas prices have rebounded
somewhat from the $6/MMBtu range to above $7, inventories still remain elevated
and LNG supply to UK has been robust as well. Low Asian LNG prices also reflect a
currently loose supply-demand balance that means Europe can obtain alternative
gas supplies (that is, LNG) at a lower cost than previously might have been
expected, for now. But there is little prospect of a gas agreement between Russia
and Ukraine before winter, and the likely consequences of an interruption of gas
supply under normal weather conditions point to higher prices, let alone a colder-
than-expected European winter |
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