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Noble Hits Oil in GoM Again - Analyst Blog

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Noble Energy Inc. ( NBL ) announced a discovery at its Troubadour exploration block in the deepwater Gulf of Mexico. Gross discovered resources in the area are currently estimated in the range of 50 to 100 million barrels of oil equivalent (MMboe).

The well located in 7,273 feet of water in the Mississippi Canyon Block 699 was drilled to a total depth of 19,510 feet. Reservoir and fluid measurements logs recognized a net natural gas pay of 50 feet in a rich Miocene reservoir. Almost 75% of the resource volumes comprised oil.

Noble Energy anticipates approval for this project by late 2013 with first production likely to begin by late 2015. The company owns a majority interest (54%) in the Big Bend as well as in the Troubadour (60%) prospect. Other Big Bend stake holders include Red Willow Offshore, LLC (15.4 %), Houston Energy Deepwater Ventures V, LLC (10.6%) and W&T Energy VI, LLC, a wholly owned subsidiary of W&T Offshore Inc. ( WTI ) (20%). W&T Energy VI, LLC and Deep Gulf Energy II, LLC each carries a 20% share in Troubadour.

Estimated results by Noble Energy indicate a higher oil recovery in the Rio Grande complex. The company is progressing on its plans of creating subsea tiebacks to an existing host facility. Troubadour follows closely on the heels of the successful Big Bend discovery.

However, Noble Energy for the moment has temporarily stalled development of the latest Troubadour well and intends to focus on the expansion of the Dantzler prospect on Mississippi Canyon 738/782.

The company will shift the rig to the Dantzler prospect, where Noble Energy has a 65% participating interest. The company expects exploration results from this well by late 2013 and is aiming to achieve a gross resource range of 50-220 MMboe.

The Gulf of Mexico is a prime operational center for Noble Energy and has an impressive exploration track record. The addition of evolving plays like the Big Bend and Troubadour will further augment growth opportunities, enriching the company's reserve basket.

Compared to declines in 2012, global oil consumption in 2013 and 2014 is forecast to increase fractionally by 0.7% and 0.2%, respectively, as per the Energy Information Administration, driven primarily by China.

Good things might also be in store for Noble Energy with Myanmar's announcement of natural gas imports from 2014. However, oil and gas prices would continue to be volatile in spite of record production from Saudi Arabia.

Noble Energy currently has a Zacks Rank #3 (Hold). Other well-placed operators include Zacks Ranked #1 (Strong Buy) Whiting Petroleum Corp. ( WLL ), Range Resources Corp. ( RRC ) and Matador Resources Co. ( MTDR ).

MATADOR RESOURC (MTDR): Free Stock Analysis Report

NOBLE ENERGY (NBL): Free Stock Analysis Report

RANGE RESOURCES (RRC): Free Stock Analysis Report

WHITING PETROLM (WLL): Free Stock Analysis Report

W&T OFFSHORE (WTI): Free Stock Analysis Report

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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.


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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