Energy Sector Update for 10/05/2018: TRP,TRP.TO,DCP,PTEN,PDS,BHGE

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Top Energy Stocks

XOM -0.53%

CVX +0.02%

COP -0.01%

SLB +0.11%

OXY -0.93%

Energy stocks were ending lower Friday afternoon, with the NYSE Energy Sector Index (^NYE) falling almost 0.5% while shares of energy companies in the S&P 500 ( XLE ) were down slightly less than 0.25% as a group. West Texas Intermediate crude oil for November delivery settled a penny higher at $74.34 per barrel at the New York Mercantile Exchange. November natural gas futures were 1 cent lower at $3.15 per 1 million BTU. Among energy-related ETFs, United States Oil ( USO ) was rising down more than 0.15% in recent trading while United States Natural Gas ( UNG ) was dropping about 1.0%. The Philadelphia Oil Service Sector index (^OSX) also was down nearly 0.1% today.

In industry news:

U.S. oil companies pulled another two drill-rigs out of the field during the seven days ended Oct. 5, dropping to 861 rigs in use throughout the country and marking the third week in a row the rig count declined, according to energy-services firm Baker Hughes ( BHGE ). The number of oil rigs in use also fell again in Canada this week, with three rigs idled and leaving 119 oil rigs operating. The number of natural gas rigs in the United States remained steady this week at 189 rigs while Canadian operators added seven gas rigs for a total of 63. The North American total increased by two rigs to 1,234 compared with 1,145 rigs operating in the U.S. and Canada during the same week in 2017.

Among energy stocks moving on news:

(+) TransCanada Corp (TRP,TRP.TO) was fractionally higher in late Friday trading, with the Canadian pipeline company getting a small lift after saying the Western Build of its WB XPress pipeline connecting shale natural gasfields in West Virginia with processing plants on the U.S. Gulf Coast is now operating. The pipeline upgrade was designed to move 760 million cubic feet of gas to a delivery point on the Broad Run System of the Tennessee Gas Pipeline. The project also included a compressor station in Clendenin, W.V., as well as associated pipeline and facilities.

In other sector news

(+) DCP Midstream LP ( DCP ) was maintaining most of its 3% Friday advance, after late Thursday saying it received about $96.1 million in net proceeds from the initial sale of 4 million 7.95% Series C fixed-to-floating rate cumulative redeemable perpetual preferred stock units at $25 apiece by a group of underwriters led by RBC Capital Markets. The pipeline and gathering partnership also issued a 30-day options to the underwriters to buy up to 600,000 preferred-stock offering on the same terms of the firm units. Net proceeds will be used to fund capital projects and repaying existing debt as well as other general partnership purposes.

(-) Patterson-UTI Energy (PTEN) rose almost 3% at one point on Friday only to give back all of that prior gain that followed analysts at Bernstein beginning coverage of the contract driller with an Outperform stock rating and a $21 price target.

(-) Precision Drilling (PDS) dropped 3% on Friday after it announced plans to acquire rival Trinidad Drilling (TGD.TO) in a deal valued at CAD1.03 billion ($797 million), including the assumption of debt.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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