Volkswagen Halts Planned Merger with Porsche

- Volkswagen Halts Planned Merger with Porsche



Sep 8, 2011

Volkswagen (ETR:VOW) says on Thursday it's planned merger with Porsche (ETR:PAH3) will not go through as planned, at least not yet.

The company said the merger could not be implemented within the time frame agreed upon due to uncertainty of the economy, legal hurdles, as well as proper valuation of Porsche.

In the announcement the company said, "From Volkswagen's perspective, the continuing legal hurdles mean that it is currently impossible to quantify the economic risks of a merger and therefore to perform the valuation of Porsche SE required to determine the exchange ratio. The main causes of uncertainty are the ongoing proceedings and actions brought against Porsche SE in Germany and the USA for alleged market manipulation. According to the information currently available, these legal hurdles are no longer expected to be removed in time. One factor influencing the Board of Management's assessment was an indication by the Stuttgart public prosecutors of the length of time needed for the preliminary investigations."

In the coming weeks, members of Volkswagen's Board of Management will analyze whether there are other potential avenues to explore to complete the agreement. Both companies still believe the planned merger will continue at a later time

Oil & Gas Post

Promote Your Page Too
LINK

ConocoPhillips Completes Shutdown of Bohai Bay Oilfield

- ConocoPhillips Completes Shutdown of Bohai Bay Oilfield



Sep 6, 2011

ConocoPhillips China (NYSE:COP) has completed the shutdown of its Bohai oilfield operations, as ordered by China marine authority.

The company says it will continue to work with CNNOC (NYSE:CEO), which holds a 51% stake of in the oil field, to develop a plan to reduce reservoir pressure to ensure the safety of the field

ConocoPhillips (NYSE:COP) has a potential upside of 24.6% based on a current price of $66.44 and an average consensus analyst price target of $82.8.

Oil & Gas Post

Promote Your Page Too
LINK

Integrys Energy Group Announces Two Acquisitions

- Integrys Energy Group Announces Two Acquisitions



Sep 1, 2011

Integrys Energy Group (NYSE:TEG) announced the acquisition of two operating businesses involved in the compressed natural gas fueling business, Pinnacle CNG Systems and Trillium USA, previously owned by Wagner & Brown, Ltd.

Charlie Schrock, Integrys Chairman, President and Chief Executive Officer said, "Expansion into this business is consistent with our mission of providing customers with the best value in energy and related services. Our decision to enter this market is in response to customer needs, and this is complementary to our existing skill sets in regulated and nonregulated natural gas and electric services."

Integrys Energy has a potential upside of 2.4% based on a current price of $49.79 and an average consensus analyst price target of $51.

Oil & Gas Post

Promote Your Page Too
LINK

Halliburton Planning To Hire 11,000 In 2011

- Halliburton Planning To Hire 11,000 In 2011



Aug 25, 2011

Halliburton (NYSE:HAL) plans to hire 11,000 workers in North America in 2011, according to a top executive who told Jim Cramer on CNBC's Mad Money on Wednesday.

The president of the Western Hemisphere, Jim Brown said many of the new hires will be sent to North Dakota's oil-rich Bakken shale, which is one of the largest oil finds in the U.S.

Brown commented, "If you have a willingness to work and an aptitude to learn with a high school education, within a year-and-a-half to two years, you can become a front-line supervisor. That job will pay $125,000 to $130,000 a year. It's a tremendous opportunity. You gotta come to North Dakota, but what we're doing here, we're replicating across the nation."

Halliburton (NYSE:HAL) has a potential upside of 79.6% based on a current price of $40.27 and an average consensus analyst price target of $72.31.

Oil & Gas Post

Promote Your Page Too
LINK

Legacy Reserves Enters Equity Distribution Agreement for Up to $60 Million In Units

- Legacy Reserves Enters Equity Distribution Agreement for Up to $60 Million In Units



Aug 25, 2011

Legacy Reserves (NASDAQ:LGCY) entered into an Equity Distribution Agreement with Knight Capital Americas. Pursuant to the terms of the Agreement, the Partnership may sell from time to time through Knight, as the Partnership's sales agent, the Partnership's common units representing limited partner interests having an aggregate offering of up to $60 million.

Sales of the units, if any, will be made by means of ordinary brokers' transactions on the Nasdaq Global Select Market at market prices, in block transactions or as otherwise agreed by the Partnership and Knight.

Legacy Reserves (NASDAQ:LGCY) has a potential upside of 27.5% based on a current price of $26.68 and an average consensus analyst price target of $34.

Oil & Gas Post

Promote Your Page Too
LINK

GM and LG to Jointly Develop Electric Vehicles

- GM and LG to Jointly Develop Electric Vehicles



Aug 25, 2011

General Motors and LG Group will join forces in design and engineer future electric vehicles, expanding a relationship built on LG's work as the battery cell supplier for the Chevrolet Volt and Opel Ampera extended-range electric vehicles.

The definitive agreement will assist GM expand the number and types of electric vehicles it makes and sells by using LG's proven expertise in batteries and other systems.

Timing of the launch of the first vehicles resulting from the partnership will be announced closer to market readiness. The agreement does not involve an exchange of equity between the companies.

General Motors (NYSE:GM) has a potential upside of 85.6% based on a current price of $22.3 and an average consensus analyst price target of $41.38.

Oil & Gas Post

Promote Your Page Too
LINK

Royal Dutch Shell Trying to Stop Oil Leak in North Sea

- Royal Dutch Shell Trying to Stop Oil Leak in North Sea



Aug 18, 2011

Royal Dutch Shell (NYSE:RDS.A) is trying to stop an oil spill leak in the North Sea.

In the first phase of the operation to shut down the leak, engineers have lowered five giant concrete "blankets" on to a stretch of pipeline to place it back on the seabed after it lifted 4 feet off the sea floor.

Work is ongoing to lay concrete blankets to secure the pipeline, Shell spokesman Steve Harris said.

"First, we have to make a risk assessment ... to make sure that we can find a safe way to shut it off. We expect the result of the risk assessment very quickly and then divers will go down 300 feet (90 meters) and turn off the remaining amount of oil that is leaking into the sea."

Nearly 1,300 barrels of oil has leaked from its Gannet Alpha platform since August 12.

Royal Dutch Shell (NYSE:RDS.A) has a potential upside of 32.6% based on a current price of $63.21 and an average consensus analyst price target of $83.83.

Oil & Gas Post

Promote Your Page Too
LINK

Noble Energy Pays $3.4 Billion For 50% Stake in Consol's Marcellus Assets

- Noble Energy Pays $3.4 Billion For 50% Stake in Consol's Marcellus Assets



Aug 18, 2011

Noble Energy (NYSE:NBL) agreed to pay $3.4 billion to Consol Energy (NYSE:CNX) for a 50% interest in Consol's Marcellus Shale assets.

The two companies will create a joint venture to develop Consol's 663,350 acres in the region.

In early trading, Consol rose $1.80, or 4.24%, to $42.22. In spite of the deal between Consol and Noble, most companies with property in the Marcellus region are declining along with the broader market.

Noble Energy (NYSE:NBL) has a potential upside of 33.4% based on a current price of $83.39 and an average consensus analyst price target of $111.25.

Oil & Gas Post

Promote Your Page Too
LINK

Rockwell Awarded $4 Million Order from Grizzly Oil Sands

- Rockwell Awarded $4 Million Order from Grizzly Oil Sands



Aug 16, 2011

Grizzly Oil Sands, and independent oil sands company, has awarded a $4 million order to Rockwell (NYSE:ROK) and its Global Solutions team.

Global Solutions will use the company's PlantPax process automation system to help Grizzly produce more than 5,000 barrels of oil per day at the first phase of its Algar Lake Project.

The solution supports steam-assisted gravity drainage, an enhanced oil recovery technology for producing heavy crude oil and bitumen.

Rockwell Automation is currently below its 50-day moving average (MA) of $77.93 and below its 200-day MA of $79.74.

Oil & Gas Post

Promote Your Page Too
LINK

NRG Energy Inc. To Purchase Energy Plus

- NRG Energy Inc. To Purchase Energy Plus



Aug 16, 2011

NRG Energy Inc. (NYSE:NRG) plans to purchase a Philadelphia retail electricity and natural-gas provider for $190 million in cash.

Based in Princeton, New Jersey NRG announced Tuesday that acquiring Energy Plus Holdings LLC would give the company an opportunity to widen its retail business in the Northeast.

The deal requires regulatory approvals from the Justice Department and the Federal Energy Regulatory Commission. It is expected to close in October.

NRG Energy (NYSE:NRG) has a potential upside of 21.1% based on a current price of $22.57 and an average consensus analyst price target of $27.33.

Oil & Gas Post

Promote Your Page Too
LINK

Caza Spotlights Operational, Financial Results for 2Q11

- Caza Spotlights Operational, Financial Results for 2Q11

Monday, August 15, 2011
Caza O&G Inc.

Caza O&G provided its unaudited financial and operational results for the six months ended June 30, 2011.

Second Quarter Financial Highlights

• Caza's production increased 32% to 18,130 Boe for the three-month period ended June 30, 2011, from 13,712 Boe for the comparative period in 2010. This represents an average daily production rate increase of 48 Boe/d for the three month period ended June 30, 2011, 199 Boe/d as compared to 151 Boe/d for the comparative period. As anticipated, Q2 2011 production was slightly lower than Q1 2011 (which was 23,974 Boe) due to standard production curve declines in certain wells. Recently drilled wells that are in various stages of completion are expected to more than make up for the decline (see "Second Quarter Operational Highlights" below).
• Caza had a cash balance of $24,533,451 as of June 30, 2011, as compared to $9,375,345 at June 30, 2010 and $33,885,900 at December 31, 2010. The increase is attributable to the placing announced on Nov 15 2010. Caza's working capital balance at June 30, 2011, was $20,870,708 as compared to $26,612,514 at March 31, 2011. The decrease in Caza's working capital balance primarily represents the investments made to drill the O.B. Ranch #2 development well in Wharton County, Texas, the Caza Elkins 3401 & 3402 wells in Midland County, Texas, and the Caza 158 #3 in Upton County, Texas.
• Revenues from oil and gas sales increased 112% to $843,836 for the three-month period ended June 30, 2011, up from $398,883 for the comparative period in 2010. The increase in revenues was primarily due to the additional wells brought on since the comparative period. The average combined price received by Caza increased 60% to $46.54 per Boe during the three-month period ended June 30, 2011, from $29.09 per Boe during the comparative period in 2010.
• General and Administrative expenses were $1,435,156 ($1,403,088 net of reimbursements) for the three-month period ended June 30, 2011, as compared to $1,188,962 ($1,078,739 net of reimbursements) for the comparative period in 2010. The change in General and Administrative costs are a result of additional costs incurred and changes in reporting requirements as a result of converting to the International Financial Reporting Standards. During the three month period ended June 30, 2010, the Company received reimbursements that resulted from certain joint venture agreements that provided reductions in overhead costs that expired April 8, 2010.

Second Quarter Operational Highlights

• Drilling commenced on the O.B. Ranch #2 development well in Wharton County, Texas in May 2011. The well reached its target depth of 13,210 feet in June 2011, and electric logs were obtained through the target depth indicating potential pay in the Frio and targeted Cook Mountain formations. The well was fracture stimulated at the end of July 2011, and is currently being flowed back in order to clean up the fracture fluids. The well has been placed on an extended well test, and the market will be updated once stabilized flow rates have been achieved.
• The Caza Elkins 3401 well in Midland County, Texas, reached a total depth of 11,854 feet in June 2011. The rig was immediately moved to the Caza Elkins 3402 location, which reached a total depth of 11,852 feet in July 2011. Log data from both wells indicated multiple potential pay sands for both oil and gas in the Spraberry, Wolfcamp, Strawn, Atoka and Mississippian/Devonian formations. The fracture stimulation program for the Caza Elkins 3401 well began on July 28, 2011. The fracture stimulation program for the Caza Elkins 3402 well began earlier than anticipated on August 12, 2011. Both wells are currently being flowed back in order to clean up the fracture fluids. Caza will update the market once initial flow rates have been established for each well.
• The Caza 158 #3 well on the Windham property reached its target depth of 9,824 feet in June 2011, and Caza elected to participate in the operator's proposal to complete the well. The well has been fracture stimulated across all potentially productive intervals seen on the logs, which include the Spraberry/Wolfcamp, Penn and Strawn formations. The Caza 158 #3 was the fourth well drilled and completed on this property. The Caza 158 #1, 158 #2 and 162 #1 wells are currently at various stages in their respective fracture stimulation programs, but are all producing oil and natural gas.

W. Michael Ford, Chief Executive Officer commented, "I am very pleased with the progress that we have made in 2011, both operationally and from a financial perspective. In the three months to June 30, 2011, Caza has continued to progress a busy work program, which should add further production, reserves and cash flow to the solid platform that we have created through our endeavors to date.

"Revenues have materially risen due to increased oil and gas production levels and a supportive price environment. As we add production through our exploration and development campaign, the Company and the shareholders should continue to benefit.

"I look forward to updating the market on future exploration activities and established flow rates associated with wells that are currently in various stages of completion operations."

Oil & Gas Post

Promote Your Page Too
LINK

TNK-BP Touts Financial Results for 1H 2011

- TNK-BP Touts Financial Results for 1H 2011

Tuesday, July 26, 2011
TNK-BP

TNK-BP reported its results for the first half of 2011.

Commenting on the results, Mikhail Fridman, Executive Chairman of TNK-BP Ltd., said, "This was an exceptional first half performance for TNK-BP. Thanks to management's continuous efforts to enhance operational efficiency and further develop our key business streams, the Company was able to deliver robust results. We have increased production, significantly expanded our resource base and nearly doubled net profit for the period. Growing our international business is a key priority for TNK-BP and we've made great progress thus far in 2011 by closing the deal to acquire BP's upstream assets in Venezuela and identifying several additional acquisition targets abroad."

1H11 OPERATIONAL HIGHLIGHTS

• In 1H11, oil and gas production (excluding JVs) continued to grow and reached 1,765 mboe/d, up 1.2% on 1H10. This growth was primarily driven by further production increases at our producing greenfields, Uvat and Verkhnechonskoye, and also by continued success in developing our Orenburg fields as well as increasing gas production at Rospan. We have developed and started implementation of a long-term West Siberia efficiency improvement program targeting a decrease in the annual production decline rate from the current 7% to approximately 2-3% per year.
• We have made good progress in our exploration and appraisal program aimed at growing the company’s resource base. Over 200 million boe of resources were added in 1H11 through exploration and appraisal. We have also demonstrated our ability to obtain new acreage by successfully acquiring 3 licenses through the federal auctions in the Orenburg region with estimated resources of 149 million boe.
• On the international front, we have closed the acquisition of upstream assets from BP in Venezuela in June, while the Vietnam deal close is expected in 3Q pending approval by the Vietnamese Ministry of Industry and Trade. We will now focus on the integration of these assets into our portfolio and ensuring their operational and financial efficiency. We have also just announced the signing of a Farm-out Agreement with Brazilian Petra Energia for the acquisition of a 45% stake in 21 blocks in the Brazilian Solimoes Basin. We hope to have the necessary agreements finalized before the end of August.
• Refining throughput was at 761 mb/d, increasing 11% y-o-y as a result of continuing debottlenecking efforts.
• We have progressed with expansion of our retail chain by opening the first two new-format highway service stations under the BP brand in Tver region within the framework of our long-term retail business development strategy. Opening these new service stations is the first step in implementing a strategy to develop highway retail sites in the European part of Russia. The operations of the sites have been very successful with initial fuel sale volumes exceeding the plan by 2-3 times.
• We also continued to reinforce our position in B2B by signing a long-term formula-based jet fuel supply agreement signed with Transaero Airlines, in line with the company’s strategy to strengthen its presence in Russia’s jet fuel market and increase transparency of fuel sales.
• Finally on the corporate side, we have embarked on an important initiative of improving the organizational structure of our business, led by Deputy Chairman of the Management Board, Maxim Barskiy. This involves switching from an asset-based management system, where local management has both wide functional and operational responsibility, to a functional governance model (or matrix model), with clear segregation of functions and more streamlined decision making. The first practical steps of this transition were the integration of Technology and Supply Chain Management streams into Upstream, as well as development and enactment of the new Delegation of Authority Matrix. The new organizational structure will improve decision-making, focus local management on its area of expertise, and improve our competitive advantage, as we continue our transformation into a global oil and gas player.

Commenting on the financial results, Jonathan Muir, Chief Financial Officer of TNK-BP Ltd., said, "In the first half 2011, TNK-BP continued to demonstrate strong financial results, supported by a favorable market environment, sustainable production growth and refinery throughput improvement. EBITDA increased by 59% y-o-y to USD 7.4 bn, underpinned by a 42% rise in the oil price, partially offset by cost increases due to higher excise rates, rising electricity and transportation tariffs, and continuing rouble appreciation. Our net income increased by 87% y-o-y to USD 4.5 bn on the back of EBITDA growth. Healthy cash flows from operations allowed us to raise organic capital expenditure by 33% y-o-y to USD 2.2 bn with particular focus on our key growth assets: Uvat, Verkhnechonskoye and Orenburg. Our financial discipline remained strong with good cash flow and successful debt portfolio management giving us the flexibility to pursue strategic inorganic opportunities."

1H11 FINANCIAL HIGHLIGHTS

• Revenues for 1H11 increased by 41% relative to 1H10 reflecting a 42% higher Urals price and 21 mboe/d (1.2%) production growth partly offset by a decrease of export sales in favor of the domestic market to avail of higher netbacks.
• Export duties and taxes other than income tax increased by 38% for 1H11 relative to 1H10 as a result of the impact of higher Urals prices on export duty and mineral extraction tax rates as well as the growth in excise rates in Russia partly offset by a significant duty lag benefit.
• Underlying materials, service and payroll inflation on cash costs amounted to only 4% year-on-year. However, electricity and transport tariff growth inflated cash costs by 8%. Rouble appreciation added 4% year-on-year. In addition, a one-off increase on an environmental provision in 2Q11 related to reassessment of some legacy issues increased costs by 3%.
• EBITDA for 1H11 amounted to USD 7.4 bn which is 59% higher compared to 1H10 largely due to the higher prices and duty lag benefit supported on the operations side by higher production and sales volumes. These positive factors were partly offset by a negative exchange rate impact as well as tariff and excise rates growth.
• 1H11 Net income amounted to USD 4.5 bn which is 87% up on the same period of 2010. This increase outpaced the EBITDA growth primarily due to relatively flat DD&A.
• Operating cash flow for 1H11 totaled USD 5.9 bn, up 51% compared to 1H10. This is a reflection of the higher EBITDA (adjusted for non-cash provisions), partly offset by a USD 0.5 bn increase in working capital primarily due to a price-driven growth in inventory and accounts receivable balances.
• Net debt increased by USD 0.6 bn compared to year end 2010 resulting in gearing growing to 22%.
• Organic capital investment in 1H11 amounted to USD 2.2 bn, 33% above 1H10, largely associated with increased investments in our growth greenfields (VCNG, Uvat) and Orenburg.

2Q11 RESULTS

• Revenues for 2Q11 increased by 11% relative to 1Q, reflecting primarily the increase in Urals price.
• Export duties and other taxes increased 20% q-o-q driven by a 12% increase from the price effect on export duties and MET and a decrease in duty lag benefit in 2Q, partly offset by the effect of lower export sales volumes.
• Cash costs (operating expenses, transportation and SG&A) increased by 15% largely due to rouble appreciation, increase in wellwork, contracting and other activities compared to a seasonally slower 1Q as well as increased environmental provisions.
• EBITDA for 2Q11 was 12% lower compared to 1Q. The most significant reason is the decrease of duty lag benefit further exacerbated by price-driven growth in duties, taxes and costs of purchases that effectively eliminated all q-o-q benefit of higher prices on revenues. Other factors include a comparative negative impact of one-offs - disposal gains in 1Q and higher provisions in 2Q, as well as rouble appreciation and increased spending on well-work together with annual wages and salary indexation and Moscow offices relocation cost.
• 2Q11 Net Income decreased by 14%, generally following the EBITDA trend.
• Operating cash flow in 2Q increased by 55% compared to 1Q attributed primarily to lower working capital. This is mainly due to a comparative USD 1.3 bn reduction in accounts receivable balances driven by a general decrease of trade accounts receivable due to lower crude export sales in June as well as shorter receivables collection terms.
• Organic capital investments were $0.4bn higher than in 1Q11, representing primarily a seasonally higher activity level.
• Compared to the 2Q 2010 results, 2Q 2011 EBITDA and net income increased by 45% and 81%, respectively. This reflects a stronger external environment with the Urals price increasing by 48% and a higher duty lag benefit supported by an increase in trading volumes and an improvement in trading mix, including in particular a 6% higher share of refined products. These positive factors were partly offset by the effect of a stronger rouble and inflationary pressure on costs and a USD 0.1 bn comparative net loss related to one-off impacts.

Oil & Gas Post

Promote Your Page Too
LINK

Encana Delivers Solid Financial Results on Hedging Gains

- Encana Delivers Solid Financial Results on Hedging Gains

Thursday, July 21, 2011
Encana Corp.

Encana delivered strong operational performance and solid financial results in the second quarter of 2011, growing natural gas and liquids production by 4 percent per share from the second quarter in 2010. Cash flow was US $1.1 billion, or $1.47 per share. Operating earnings were $166 million, or 22 cents per share. As a result of commodity price hedging in the second quarter, Encana's cash flow was $131 million, after tax, or 18 cents per share, higher than what the company would have generated without its commodity price hedging program. Second quarter total production was approximately 3.46 billion cubic feet equivalent per day (Bcfe/d), up 111 million cubic feet equivalent per day (MMcfe/d) from the same quarter in 2010.

"Encana delivered another quarter of strong operating performance and achieved solid cash flow and operating earnings in the face of natural gas prices that remain at levels that we believe are unsustainably low in the long term. We are on track to meet our annual guidance for cash flow and production, which is expected to grow between 5 and 7 percent per share in 2011. We remain firmly focused on being among the lowest-cost producers in the natural gas industry, diligently applying capital discipline, risk management and increased operational efficiencies in all of our decision making," said Randy Eresman, President & Chief Executive Officer.

Pursuing cost savings through operating efficiencies and supply chain optimization

"We have adapted to this prolonged period of soft natural gas prices by taking meaningful steps and applying advanced technologies to manage costs over the long term as we pursue margin maximization on all of the natural gas that we produce. On our Haynesville resource play hubs, we have reduced well drilling times in the last year by 20 percent to 40 days, and a number of wells this year have been drilled in 35 days. To counter the high demand and inflationary rates for well completion equipment, we have established long-term, efficiency-based contracts with four new, dedicated completions crews. In addition, by applying effective logistics management and leveraging Encana's demand, we have reduced our cost of commodities by self-sourcing steel, sand and fuel. These are proactive cost management programs that we expect will result in significant and ongoing cost savings. Our integrated supply chain approach also helps eliminate bottlenecks and optimize cycle times. We now have 15 rigs fueled by natural gas, about one-third of our current drilling complement, generating fuel savings of between $300,000 and $1 million per rig per year, depending on the rig's size and fuel system. While industry cost inflation this year is expected to average about 10 percent, we expect our inflation rate to average approximately half that level – which we expect will be more than offset by improvements in efficiencies," Eresman said.

Encana establishes sizable positions in two promising liquids rich plays – Duvernay and Tuscaloosa

In keeping with the company's first-mover strategy of quietly assembling meaningful land positions to capture large resource opportunities, Encana has established two more sizable land positions in prospective liquids rich plays. In western Alberta, the company has accumulated more than 365,000 net acres in the Duvernay play, where preliminary drilling results by Encana and other operators show significant potential. Two more Duvernay exploration wells are planned for this year. In Mississippi and Louisiana, Encana has captured more than 250,000 net acres of the Tuscaloosa marine shale lands and the company plans to evaluate the play's potential this year.

"Both of these plays are in their early days, but we are encouraged by our exploration results to date. Duvernay and Tuscaloosa are just two of a handful of exciting opportunities that we are pursuing on the more than 2.1 million net acres we hold with strong potential for liquids production. The Niobrara formation in Colorado and the Collingwood shale in Michigan, plus our well-established land positions in the Alberta Deep Basin and the Montney formation in Alberta and British Columbia, provide us with a diverse and promising portfolio of prospective opportunities to grow liquids production over the long term," Eresman said.

Several divestiture and joint venture initiatives moving forward

Encana's non-core divestiture program is well underway towards achieving the company's 2011 net divestitures goal of between $1 billion and $2 billion. Encana is actively engaged with a number of parties in a competitive process to divest of non-core midstream and upstream assets in Canada and the U.S. – transactions that include the northern portion of Encana's Greater Sierra resource play, midstream assets in the Cutbank Ridge resource play which straddles the British Columbia-Alberta border, the company's interest in the Cabin Gas Plant in Horn River and midstream assets in the Piceance basin of Colorado. In its joint venture initiatives to accelerate the value recognition of its enormous resource potential, Encana is also pursuing investment partners in its undeveloped Horn River lands and producing properties in the south portion of Greater Sierra. In addition, competitive marketing of joint venture opportunities on Encana's extensive undeveloped lands in its Cutbank Ridge resource play will commence this summer. Proceeds from these planned transactions are expected to supplement 2011 cash flow generation in the current low price environment and strengthen the company's balance sheet, providing financial flexibility going into 2012.

Deep Panuke project gearing up to begin production in fourth quarter

After sailing from its Abu Dhabi construction site in the Middle East, the production field center (PFC) for Encana's Deep Panuke natural gas development offshore Nova Scotia arrived in the port of Mulgrave on the Strait of Canso in late June. Crews are completing pre-commissioning work before the PFC is towed to the field location for installation about 250 kilometres southeast of Halifax. Deep Panuke is expected to deliver its first natural gas to market in the fourth quarter of 2011, with production ramping up to about 200 million cubic feet per day (MMcf/d). Offshore work this fall includes commissioning of all the operational systems, hooking up the four production wells to the PFC and connecting production facilities to the 176 kilometer pipeline that will deliver natural gas to shore at Goldboro, Nova Scotia.

"Our Deep Panuke project is gearing up to begin delivering clean natural gas to prime markets along the Eastern seaboard of North America," said Michael Graham, Encana's Executive Vice-President & President, Canadian Division.

Natural gas hedges help protect cash flow generation

For the next 18 months, Encana has about half of its expected production hedged at attractive prices – about 1.8 billion cubic feet per day (Bcf/d) at an average NYMEX price of $5.75 per thousand cubic feet (Mcf) for the last half of 2011 and approximately 2.0 Bcf/d of expected 2012 natural gas production at an average NYMEX price of about $5.80 per Mcf.

"Our risk management programs increase the certainty of our cash flow generation and help ensure stability for our capital programs and dividend payments – prudent measures that continue to underpin Encana's financial strength," Eresman said.

Oil & Gas Post

Promote Your Page Too
LINK

Sevan Marine Briefs Financial Position

- Sevan Marine Briefs Financial Position

Monday, July 11, 2011
Sevan Marine ASA

The Board of Directors of Sevan Marine continues to hold constructive dialogue with bondholders and other relevant parties regarding a global restructuring of the Company's balance sheet. In particular, the Board is in dialogue with the advisors to Norsk Tillitsmann ASA (the bond trustee for the Company's bond issues) and an informal group of the Company's largest bondholders. The dialogue with the bondholder group regarding a global restructuring currently assumes that the restructuring would involve:

• a full equitisation of the Company's existing unsecured bonds;
• a partial but reasonably material equitisation of each of the series of the Company's existing secured bonds;
• a corresponding substantial dilution of the Company's existing shareholders;
• a capital raise for the Company, likely in the form of new equity, currently estimated to be at least USD 200 million, to be funded primarily by bondholders, but with a right for existing shareholders to participate;
• extension of maturities for the Company's existing secured bonds; and
• a revision of interest rates and amortization schedules of the Company's secured bonds to correspond with the Company's cash flow profile and debt service capacity.

The above assumptions, and the detailed terms and conditions of a global restructuring proposal, remain to be finally determined and negotiated, and will, inter alia, be affected by the contents of a revised business plan currently being prepared by the Company, and the final cost estimate and schedule developments for the FPSO Sevan Voyageur upgrade project. Any global restructuring proposal will be subject to obtaining necessary agreements with, and consents from, the Company's bondholders, shareholders and other key stakeholders and counterparties to the Company and its subsidiaries.

The Company continues to be under serious short term liquidity pressure, and the Board is currently in discussions regarding bridge financing of at least USD 35 million. Further, the Company intends to request deferrals of interest payments due under the relevant bond loans up to at least end of September 2011, and bondholders who have been approached on a confidential basis have expressed their support in principle to such proposal. The Board is optimistic that its short-term liquidity issues will be resolved and that a long-term solution to the financial challenges facing the Company can be obtained by the end of September 2011.

As for the FPSO Sevan Voyageur upgrade project, further detailed project reviews and assessments have identified additional costs to be incurred by the Company, resulting in a current cost estimate for the project in the range of USD 160-170 million. The increase from the previously announced cost estimate of USD 135 million is mainly a result of time related costs due to additional delays, certain increased procurement costs for equipment, yard services and additional contingencies. First oil is currently expected to take place during the second quarter of 2012. The review is ongoing in close cooperation with the charterer.

The Company's financial situation remains challenging. In connection with the ongoing processes, renewed scrutiny and assessment of booked assets has been required. The Board has initiated a process to impairment test the Company's asset base, which is expected to result in substantial write-downs in the closing of half-year accounts of 2011.

Notwithstanding the ongoing dialogue with lenders, FPSO Sevan Voyageur stakeholders and others, no assurance can be given that a viable global solution can be found in a timely manner, failing which the Board will be required to file for bankruptcy.

Oil & Gas Post

Promote Your Page Too
LINK

JA Solar Announced It Entered Into A Definitive Agreement To Acquire Silver Age Holdings Limited

- JA Solar Announced It Entered Into A Definitive Agreement To Acquire Silver Age Holdings Limited



Jul 1, 2011

JA Solar (NASDAQ:JASO) announced that it has entered into a definitive agreement to acquire 100% ownership interest in Silver Age Holdings Limited. At the time of closing JA Solar will issue 30.901 million ordinary shares as consideration at a price of $5.825 per share.

Dr. Fang Peng, CEO of JA Solar, commented, "This agreement represents another important step in JA Solar's strategy of optimizing our cost structure through selective vertical integration. In today's solar market, it is essential for producers to improve costs while maintaining a relentless focus on technology and product quality. By boosting JA Solar's internal wafer capacity through this acquisition, we expect to achieve greater economies of scale and improve the company's profitability. Furthermore, Solar Silicon Valley has key technologies which can be leveraged to provide superior quality wafer substrates for our high-efficiency solar cell products. As a low cost leader in the solar industry, we expect that this transaction will enhance JA Solar's leadership position and enable us to meet strong global demand for our high-quality, high-efficiency solar products."

Oil & Gas Post

Promote Your Page Too
LINK

Chrysler Group Reports June Sales Up 30% From June 2010

- Chrysler Group Reports June Sales Up 30% From June 2010



Jul 1, 2011

Chrysler Group LLC reported U.S. sales of 120,394, a 30% increase over June of 2010 and its best month since 2007.

Reid Bigland, Head of U.S. Sales for Chrysler said, "Thanks to our alliance with Fiat, we now have 12 models that have EPA-rated highway fuel economy of 25 miles per gallon or higher, and four of those models get 30 mpg or more. This business is all about product and consumers are rapidly discovering everything we now have. Each Chrysler Group brand is contributing to our success and driving our 46 percent retail sales growth."

The company's Jeep brand posted a 74% year-over-year sales increase, the largest of Chrysler Group brands.

For the first six months of the year, Chrysler's sales are up 21% from 2010.

The company finished the month with a 68-day supply of inventory, 314,065 units. Chrysler estimates industry-wide sales figures for the month of June were at a seasonally adjusted annual rate of 11.8 million.

Oil & Gas Post

Promote Your Page Too
LINK

Ford's June Sales Grow 13.6% Year-Over-Year

- Ford's June Sales Grow 13.6% Year-Over-Year



Jul 1, 2011

Ford Motor's (NYSE:F) June sales totaled 194,114, growing 13.6% from June 2010, the company reported today.

Ken Czubay, Ford vice president, U.S. Marketing, Sales and Service said, "Strong demand for Ford's fuel-efficient cars and crossovers continues, and we now are seeing truck buyers return to the market with significant appetite for our fuel-efficient V6 engines. The Fiesta and Focus are driving Ford's retail share gains in markets beyond our traditional geographic areas of strength. In California, Ford's retail share is the highest since 2006. We also have seen gains in the East and Southeast."

Ford's small cars powered the sales figures, as the all-new Fiesta and the Ford Focus accounted for 26,920 sales in June, up 66% from a year ago. The Fiesta and Focus recently were named to Kelley Blue Book's 2011 Top 10 Coolest New Cars Under $18,000.

Ford's utilities were also strong, with 6-month sales now totaling 280,875, a 25% increase over the first six months of 2010, making it the top selling utility brand in the U.S.

Shares of Ford Motor are trading up 1.16% at $13.95.

Oil & Gas Post

Promote Your Page Too
LINK

Niko Updates Financial, Operational Results for Year-End

- Niko Updates Financial, Operational Results for Year-End

Wednesday, June 29, 2011
Niko Resources Ltd.

Niko reported its financial and operating results, including consolidated financial statements and notes thereto, as well as its managements' discussion and analysis, for the year ended March 31, 2011. The operating results are effective June 28, 2011. All amounts are in U.S. dollars unless otherwise indicated.

FINANCIAL HIGHLIGHTS

• There was a year-over-year increase of 32 percent in funds from operations.
• In October 2010, Niko repaid all of its outstanding long-term debt.
• At March 31, 2011, the Company's unrestricted cash totaled $108 million.
• In January 2009, the Company announced that the Canadian authorities were engaged in a formal investigation into allegations of improper payments in Bangladesh. The Company cooperated in the investigation, which was concluded on June 24, 2011. The Company pleaded guilty to one count of bribery under the Corruption of Foreign Public Officials Act, was fined Cdn$9.5 million and is subject to a 3-year Probation Order. In early 2009, the Company adopted a full anti-corruption compliance program.

EXPLORATION HIGHLIGHTS

• Indonesia: Four new offshore exploration blocks were added and the Company farmed out 45 percent of its working interest in the Seram and East Bula blocks and 40 percent of its working interest in the North Makassar Strait, West Papua IV and Halmahera-Kofiau blocks. Seismic acquisition activity continued during the year and the planning of drilling has commenced.
• Trinidad: The Company increased its exploration acreage in Trinidad with three new offshore blocks, all of which are in proximity to producing gas fields, and entered into an agreement, which closed subsequent to year-end, to acquire a 25 percent working interest in Block 5(c), located 94 kilometres off the east coast of Trinidad.
• Madagascar: Seismic acquisition has been completed and processing is underway.
• Kurdistan: Drilling was completed to a depth of 3,908 meters in May and testing is underway and expected to continue into July 2011.

PRESIDENT'S REPORT

The Company's strategy of accumulating a highly prospective exploration portfolio continued.

In Indonesia, four new blocks were added and farm-outs occurred in five blocks. Farm-outs are a part of the Company's exploration strategy. Partners in Indonesia now include Exxon/Mobil, Marathon, Repsol and Statoil.

In Trinidad & Tobago, four new blocks were added. Partners in this country include Centrica and RWE.

From a drilling perspective, in Trinidad and Tobago, the Company has contracted an offshore rig that is expected to spud the Company's first offshore well in the country in October. In Indonesia, Niko has established an extremely strong drilling organization staffed with seasoned professionals that bring extensive deep-water drilling experience.

During the past year, uncertainty regarding D6 production, reserves and gas price has been a concern. This uncertainty has been largely removed by an independent reserve report that shows that the revision to the Company's worldwide net proved plus probable reserves was approximately 6.8 percent. Operationally, the D6 field's gross gas production averaged approximately 2 billion cubic feet per day over the year with no downtime.

Due to a pre-emptive right, Niko expects to have the opportunity to increase its net interest by 30 percent in each or all of the D6, NEC-25 and D4 blocks in India. Niko expects this opportunity would be financed with debt.

Niko has a strong production base and an extensive portfolio of exploration prospects. Two thousand and twelve could prove to be Niko's most exciting year ever.

Production from the D6 Block has increased year-over-year and is the primary reason for total production increases of 25 percent compared to production in the prior year. The D6 Block is also the primary reason for improved operating netbacks as the D6 Block has higher realized prices and lower profit petroleum than the average of the Company's other properties.

Gas sales volumes from the D6 Block for the year averaged approximately 198 MMcf/d versus a budget of 210 MMcf/d due to well performance. Current gas sales volumes from the block are approximately 167 MMcf/d. Production from the D6 Block is expected to decline until additional wells are drilled and tied-in.

The Company is forecasting total production of 236 MMcfe/d for Fiscal 2012, which assumes that no additional wells will be tied in at D6 during the year and is consistent with the estimated production from total proved reserves in the Company's reserve report.

Operating cashflow increased in Fiscal 2011 primarily as a result of increased oil and gas sales from the D6 Block. Forecast operating cashflow for the coming year is expected to decrease with the decrease in production described above. In addition, maintenance of the onshore terminal and subsea systems for the D6 Block are expected to result in a decreased operating netback.

Exploration expenditures for Fiscal 2011 were for drilling activities on three exploration wells in the D6 Block, seismic acquisition in Indonesia and Madagascar, drilling of the first exploration well in Kurdistan and seismic on Block 2AB in Trinidad and carrying costs of the Trinidad blocks. Forecast expenditures for Fiscal 2012 include drilling on the D6 and D4 Blocks in India; seismic activity and preparation for drilling activities in Indonesia; completion of drilling the well in Kurdistan, and seismic activity in Trinidad on all blocks and commencement of drilling on Block 2AB.

Development expenditures forecast for Fiscal 2012 are primarily for workovers, drilling new wells and acquisition of compression equipment for the D6 block.

In addition to exploration and development expenditures, the Company's acquisition of Block 5(c), located 94 kilometres off the east coast of Trinidad closed in June 2011 for a purchase price of $78.1 million.

Funds from operations improvements resulted from improved volumes and operating netbacks partially offset by higher current income taxes, higher interest expense related to the Company's convertible debentures, a Cdn$9.5 million (US$9.7 million) fine described previously herein and lower other income as the prior year periods benefited from a favorable arbitration ruling related to a pipeline dispute.

Net income increased year-over-year as a result of the increase in funds from operations. The benefit from improved funds from operations was offset by higher non-cash charges related primarily to depletion and a loss on short-term investments.

Exploration Acreage

Niko has increased its exploration acreage with the addition of three blocks in Trinidad and four blocks in Indonesia. In addition, Niko farmed out 45 percent of its working interest in two blocks in Indonesia to Repsol and 40 percent of its working interest in three blocks in Indonesia to Statoil.

Oil & Gas Post

Promote Your Page Too

UBS Initiates Coverage of Western Refining With $17 Target, Neutral Rating

- UBS Initiates Coverage of Western Refining With $17 Target, Neutral Rating



Jun 28, 2011

UBS initiated coverage of Western Refining (NYSE:WNR) today with a $17 price target and a neutral rating on the company.

Shares of Western Refining are trading up 3.13% at $17.12.

Western Refining has a potential upside of 23.2% based on a current price of $17.12 and an average consensus analyst price target of $21.1.

Western Refining is currently above its 50-day moving average (MA) of $16.38 and above its 200-day of $12.42.

Oil & Gas Post

Promote Your Page Too

Energy Sector Update: June 14, 2011

- Energy Sector Update: June 14, 2011



Jun 14, 2011

Energy shares are higher mid-day as the broader market is looking to regain lost ground. Light, sweet crude oil for July delivery traded up 1.5% to $98.78 a barrel. Cloud Peak Energy (NYSE:CLD), a U.S. coal producer, today, announced an agreement with Westshore Terminals LP to permit coal shipments through the Westshore Terminal in Vancouver, BC for ten years. Cloud Peak Energy exported 3.3 mln tons to Asian customers in 2010 through the terminal. The contract will commence in 2013 once the current contract ends, pending a definitive agreement between the parties.

Oil & Gas Post

Promote Your Page Too