Energy stocks are set for a mixed start, weighed down by weakness in the underlying commodities while U.S. stock index futures were steady as focus shifts to the upcoming Federal Reserve meeting that could lay the groundwork for an interest rate cut later this year.
Oil futures slid in early trading as signs of an economic slowdown as international trade disputes began to outweigh supply fears which were stoked by attacks on two oil tankers in the Gulf of Oman last week. Meanwhile, Saudi Energy Minister said on the sidelines of a G20 Energy and Environmental Ministerial meeting that OPEC will probably meet the first week of July and hoped it would reach consensus on extending the current output agreement. He added that the oil market was well supplied, although concerns about geopolitical risks remained high. Also weighing on prices was the dim outlook for oil demand growth in 2019 projected by the IEA on Friday, citing worsening prospects for global trade.
Natural gas futures are off more than 1% this morning, weighed down by milder temperatures this week which should limit cooling demand while North Dakota on Friday reported April natural gas production in the state was at a new all-time high.
Reuters - Production at Iraq's giant West Qurna 1 oilfield in the south has reached 465,000 barrels per day (bpd) after the completion of new crude processing facilities and oil storage tanks. West Qurna 1 oilfield, developed by Exxon, was previously producing about 440,000 bpd, officials working at the field told Reuters on the sideline of a ceremony to launch the new installations.
Reuters - Petroleo Brasileiro has made natural gas discoveries in six deep-water fields in the Sergipe Basin. Petrobras said it is now looking at drawing up a budget plan to finance production from the potential wells that were discovered "in the last few years."
(Late Friday) Reuters - Royal Dutch Shell said that Martinez California refinery experienced unit upset on June 12 and it’s now stable.
Reuters - Total’s Saft signed deal to provide batteries to equip AVIC's MA700 plane.
Press Release - Denbury Resources announced the early participation results of its exchange offers to: Eligible Holdersof its 6⅜% Senior Subordinated Notes due 2021 and its 5½% Senior Subordinated Notes due 2022 (the “2022 Notes” and, together with the 2021 Notes, the “Old Subordinated Notes”) (the “Subordinated Notes Exchange Offers”); and Eligible Holders of its 7½% Senior Secured Second Lien Notes due 2024 (the “Old Second Lien Notes” and, together with the Old Subordinated Notes, the “Old Notes”) (the “Second Lien Notes Exchange Offer” and, together with the Subordinated Notes Exchange Offers, the “Exchange Offers”).
Stephens assumed coverage of SM Energy at ‘Overweight.’
Press Release - Ultra Petroleum announced that, with respect to the previously announced private offer to exchange outstanding 7.125% Senior Notes due 2025 of its wholly owned subsidiary, Ultra Resources, for up to $90.0 million aggregate principal amount of new 9.00% Cash / 2.50% PIK Senior Secured Third Lien Notes due 2024 of Ultra Resources, it has extended the Early Participation Date and the Withdrawal Deadline to 5:00 p.m., New York City time, on Friday, June 21, 2019. All other terms and conditions of the Exchange Offer as set forth in the confidential offering memorandum dated May 9, 2019 and related letter of transmittal (together, the “Offering Documents”) remain unchanged.
(PRNewswire) – Lonestar Resources announced today an increase in its borrowing base and the addition of crude oil and natural gas hedges for 2020 and 2021. Citibank, as agent for Lonestar's Senior Secured Credit Facility, informed the Company that the bank group has approved an increase in the Borrowing Base from $275 million to $290 million.
Credit Suisse initiated coverage in Diamondback Energy with ‘Outperform.’
Williams Capital initiated coverage in Jagged Peak Energy with ‘Buy.’
SunTrust Robinson assumed coverage of Viper Energy Partners at ‘Buy.’
(Late Friday) Press Release - Peyto Exploration & Development confirmed that the monthly dividend with respect to June 2019 of $0.02 per common share is to be paid on July 15, 2019, for shareholders of record on June 30, 2019. The ex-dividend date is June 27, 2019.
Press Release - C&J Energy Services and Keane Group announced that they have entered into a definitive agreement whereby the companies will combine in an all-stock merger of equals. The combined company will be positioned as an industry-leading, diversified oilfield services provider with a pro-forma enterprise value of approximately $1.8 billion, including $255 million of net debt. The combined company will be led by a proven management team that reflects the strengths and capabilities of both organizations. Upon close, Patrick Murray, Chairman of the C&J Board of Directors will serve as Chair of the combined company's Board of Directors, and Robert Drummond, Chief Executive Officer of Keane, will serve as President and Chief Executive Officer of the combined company. Jan Kees van Gaalen, Chief Financial Officer of C&J, will serve as Executive Vice President and Chief Financial Officer of the combined company, and Gregory Powell, President and Chief Financial Officer of Keane will serve as Executive Vice President and Chief Integration Officer of the combined company. Additional senior executives for the combined company will be selected from top talent at both companies and named prior to the close of the transaction.
Press Release - Seadrill Partners has secured a one well contract with Kosmos Energy Gulf of Mexico Operations, LLC, for the West Capricorn in the US Gulf of Mexico. Backlog for the contract is expected to be approximately $10 million and commencement is expected in Q4 2019.
MLPS & PIPELINES
(Late Friday) Press Release - Targa Resources Partners announced its monthly distribution on the Partnership’s 9.00% Series A Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units ("Series A Preferred Units") for June 2019. Targa Resources Partners announced that the board of directors of its general partner has declared a monthly cash distribution of 18.75¢ per Series A Preferred Unit, or $2.25 per Series A Preferred Unit on an annualized basis, for June 2019. This cash distribution will be paid July 15, 2019 on all outstanding Series A Preferred Units to holders of record as of the close of business on June 28, 2019.
JP Morgan upgraded Gibson Energy to ‘Overweight’ from ‘Neutral.’
Stifel downgraded Kinder Morgan to ‘Hold’ from ‘Buy.’
Bank of America initiated coverage in Equitrans Midstream with ‘Neutral.’
Piper Jaffray and JP Morgan initiated coverage in Rattler Midstream Partners with ‘Overweight.’
Goldman Sachs, SunTrust Robinson, and Seaport Global Securities initiated coverage in Rattler Midstream Partners with ‘Buy.’
Wells Fargo and Northland Capital initiated coverage in Rattler Midstream Partnerswith ‘Outperform.’
Barclays initiated coverage in Rattler Midstream Partners with ‘Equal-weight.’
RBC Capital initiated coverage in Rattler Midstream Partners with ‘Sector Perform.’
Credit Suisse and Citi initiated coverage in Rattler Midstream Partners with ‘Neutral.’
Futures for U.S. stock indexes were little changed as investors braced for the U.S. Federal Reserve meeting this week. A fall in airlines following a profit warning from Germany's Lufthansa weighed on European shares, offsetting a rise in banking shares led by Deutsche Bank and HSBC. Asian shares ended mixed as political tensions in the Middle East and Hong Kong kept risk appetite in check. The dollar inched lower against a basket of major currencies after hitting a two-week high. Signs of an economic slowdown pushed oil prices lower and gold prices slipped.
NASDAQ ENERGY TEAM THOUGHT LEADERSHIP
- 5/2/19 - CNBC Worldwide Exchange – Energy sector M&A
- 4/23/19 - Bloomberg Daybreak Asia – Iran sanctions implications
- 3/26/19 - CNBC World Wide Exchange – Energy sector performance
- 3/18/19 - Bloomberg Daybreak Asia – OPEC meeting, Iran sanctions
Nasdaq Advisory Services Energy Team is part of Nasdaq's Advisory Services -- the most experienced team in the industry. The team delivers unmatched shareholder analysis, a comprehensive view of trading and investor activity, and insights into how best to manage investor relations outreach efforts. For questions, please contact Tamar Essner.
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