W&T Offshore, Inc.
) subsequent to raising its 2013 capex plans on Monday has
witnessed a northward boost of 4.4% to its shares to close at
$18.50 per share on Wednesday.
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W&T OFFSHORE (WTI): Free Stock Analysis
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The company increased its 2013 capital budget to $550 million
from the earlier guidance of $450 million. The revised budget
includes increased deepwater activity, completion costs on
successful exploration wells, additional onshore drilling at
Yellow Rose field, as well as additional seismic and leasehold
cost. The revised budget is split 60% for exploration and
40% for development.
Of the $550 million, 65% would be for offshore projects, while
35% for onshore ventures. In the first half of 2013, the company
had invested $299.2 million in capital projects. Capital
expenditures comprised $109.3 million for exploration activities,
$168.1 million for development activities, and $21.8 million for
leasehold and other costs.
W&T Offshore is an independent oil and natural gas producer
with offshore operations in the GoM and onshore activities in the
Permian Basin of West Texas and in East Texas. The company has
grown through acquisitions, exploration and development, and
currently holds working interest in approximately 71 offshore
fields in federal and state waters (65 producing and six fields
capable of producing).
W&T Offshore currently has under lease over 1.4 million gross
acres, including over 710,000 gross acres on the Gulf of Mexico
shelf, over 480,000 gross acres in the deepwater and over 220,000
gross acres onshore in Texas. A substantial majority of daily
production is derived from wells it operates offshore.
The company currently retains a Zacks Rank #3 (Hold). While we
prefer to remain on the sidelines for W&T Offshore, there are
other stocks in the sector that appear rewarding. Among these,
Abraxas Petroleum Corp.
Stone Energy Corp.
Matador Resources Company
) are expected to outperform the broader market over the next few
months and carry a Zacks Rank #1 (Strong Buy).