Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

Noble Energy Inc.'s (NBL - Analyst Report) share price climbed 40 cents to close at $67.40 on Oct 14, 2013 on the back of the company's announcement of a planned investment of $10 billion in the next five years in the Niobrara play in the Denver-Julesburg (DJ) Basin.

The lofty investment is expected to bolster Noble Energy's production level in the coming years. Noble Energy will allocate 43% of its capital budget in the Niobrara Basin in 2013 and will exploit the asset to attain its annual production growth target of 17% through 2017.

Noble Energy's production volume might reach 540,000 barrels of oil equivalent per day (boe/d) by 2017, more than double the current production level of 260,000 boe/d, if the company accomplishes its target.

Roughly $1.7 million is being spent in 2013 for the development of the Niobrara play. This involves Noble Energy's plan of finishing 300 wells and ramping up production from 90,000 boe/d in 2012 to 110,000 boe/d by year-end 2013.

With more wells coming online, production is estimated to increase by 180,000 boe/d and would allow Noble to achieve its ambitious production goal. Noble Energy has already witnessed favorable drilling results in 9,500 horizontal well locations in the Niobrara play.

The company is enhancing its operational capabilities to pull off its plan of drilling 500 wells per year by 2017 which would accelerate production volume by 20% a year. We believe these investments will fetch lucrative returns for Noble Energy which in turn will lead to value accretion for the company's shareholders.

The Colorado mishap might however delay Noble Energy's production commitments in the short run. Over the long haul, significant oil discoveries in the company's prime Gulf of Mexico prospect and encouraging opportunities from the domestic natural gas assets will act as major catalysts to growth.

Another leading oil and gas operator expected to capitalize on the reserve-rich DJ Basin is Anadarko Petroleum Corp. (APC - Analyst Report) with its prospects in the adjacent Wattenberg play.

At the moment, Noble Energy carries a Zacks Rank #3 (Hold). However, other better-placed exploration and production players include Zacks Ranked #1 (Strong Buy) Matador Resources Co. (MTDR - Snapshot Report) and Stone Energy Corp. (SGY - Analyst Report).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
LAKE SHORE G LSG 0.77 +6.05%
QUESTCOR PHA QCOR 80.07 +2.47%
VIPSHOP HOLD VIPS 156.35 +1.82%
ENLINK MIDST ENLC 36.29 +1.60%
BNC BANCORP BNCN 17.33 +1.58%