Noble Energy Inc.
) released revised production volume estimates for its
Denver/Julesburg (DJ) Basin operation for the upcoming quarters
after the impact of the devastating northern Colorado flood in
early Sep 2013. About 4% of the company's operated wells are
Noble Energy expects overall net production loss for the third
quarter 2013 of approximately 2 thousand barrels of oil
equivalent per day (MBoe/d), on an average. Of the total
production loss, 70% comprises crude oil, condensates and natural
Access to certain operational areas is still limited delaying
Noble Energy's completion activities. Operational lag and well
shut-ins will jointly impact the company's fourth quarter 2013
volumes by roughly 5 to 7 MBoe/d on an average. About 80% of this
will be liquid volumes.
However, Noble Energy's post-flood operation scenario looks
encouraging as drilling activities have returned to normal levels
with every rig operating at full capacity. In addition, the
company is functioning at production levels higher than the
pre-flood volumes owing to prolific drilling in the basin.
Noble Energy completion activities are progressing well and
will eliminate its backlog by the end of the first quarter 2014.
The company is currently focused on restarting production at the
wells that were closed prior to the floods as soon as
The adverse impact from the flood will be at most short lived.
Noble Energy's timely restoration of activities in the DJ basin
bears testimony to its efficient management skills.
We believe additional discoveries in the Gulf of Mexico and
promising natural gas prospects from the company's Eastern
Mediterranean operations will support Noble Energy's future
Other potential domestic assets that will likely drive the
company's long-term growth include the Kyoto gas plant in
northern Colorado and the Tioga gas plant in North Dakota, which
are expected to come into service by 2014 and 2015,
Nonetheless, volatility in oil and natural gas prices will
remain a concern for Noble Energy. Currently, the company carries
a Zacks Rank #3 (Hold).
However, other better-placed industry players include Zacks
Ranked #1 (Strong Buy)
Matador Resources Co.
Stone Energy Corp.
Devon Energy Corp.
DEVON ENERGY (DVN): Free Stock Analysis
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