ConocoPhillips (COP - Free Report) recently agreed to acquire liquid-rich Montney acreage in British Columbia, Canada, from Kelt Exploration Ltd. for $375 million in cash. The acreage under consideration is adjacent to ConocoPhillips’ Montney assets. Moreover, the U.S. upstream energy major has agreed to assume around $30 million in financial obligations related to some of the infrastructure at the site.
With the acquisition of 140,000 net acres, the company’s acreage holding in the region will likely rise to 295,000 net acres, wherein it holds 100% working interest. The move adds more than 1 billion barrels of oil equivalent to its resource base. It has a cost of supply in mid-$30s on a West Texas Intermediate crude price basis. The move will likely add more than 1,000 high-quality well locations to the company’s portfolio.
The deal, which is expected to close in third-quarter 2020, will boost the company’s footprint in the core of the liquids-rich Montney acreage. The effective transaction date of the deal is Jul 1, 2020. The company stated that the acquired acreage has a production capacity of 15,000 barrels of oil equivalent per day (Boe/d). ConocoPhillips commenced production from the Montney development in the March quarter.
Notably, ConocoPhillips divested a chunk of Canadian assets three years back to Cenovus Energy Inc. (CVE - Free Report) . The upstream major reduced production at its Surmont Canadian site last April as oil prices tumbled to historic lows. The region is expected to witness a rise in production in the third quarter.
The company’s second-quarter production volumes are expected within 960-980 thousand Boe/d, indicating a decline from the year-ago period’s 1,290 thousand Boe/d (unadjusted). Combined with low oil prices, the curtailed production volumes are expected to have resulted in a decline in second-quarter profit levels.
Price Performance
The company’s shares have gained 13.3% in the past three months compared with 17.4% rise of the industry it belongs to.
Zacks Rank & Stocks to Consider
The company currently has a Zacks Rank #3 (Hold). Some better-ranked players in the energy space include NGL Energy Partners LP (NGL - Free Report) and Centennial Resource Development, Inc. , each holding a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
NGL Energy Partners’ bottom line for second-quarter 2020 is expected to rise 92.7% year over year.
Centennial Resource’s second-quarter earnings estimates have improved over the past 30 days, with two upward estimate revisions and no downward movement.
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ConocoPhillips (COP - Free Report) recently agreed to acquire liquid-rich Montney acreage in British Columbia, Canada, from Kelt Exploration Ltd. for $375 million in cash. The acreage under consideration is adjacent to ConocoPhillips’ Montney assets. Moreover, the U.S. upstream energy major has agreed to assume around $30 million in financial obligations related to some of the infrastructure at the site.
With the acquisition of 140,000 net acres, the company’s acreage holding in the region will likely rise to 295,000 net acres, wherein it holds 100% working interest. The move adds more than 1 billion barrels of oil equivalent to its resource base. It has a cost of supply in mid-$30s on a West Texas Intermediate crude price basis. The move will likely add more than 1,000 high-quality well locations to the company’s portfolio.
The deal, which is expected to close in third-quarter 2020, will boost the company’s footprint in the core of the liquids-rich Montney acreage. The effective transaction date of the deal is Jul 1, 2020. The company stated that the acquired acreage has a production capacity of 15,000 barrels of oil equivalent per day (Boe/d). ConocoPhillips commenced production from the Montney development in the March quarter.
Notably, ConocoPhillips divested a chunk of Canadian assets three years back to Cenovus Energy Inc. (CVE - Free Report) . The upstream major reduced production at its Surmont Canadian site last April as oil prices tumbled to historic lows. The region is expected to witness a rise in production in the third quarter.
The company’s second-quarter production volumes are expected within 960-980 thousand Boe/d, indicating a decline from the year-ago period’s 1,290 thousand Boe/d (unadjusted). Combined with low oil prices, the curtailed production volumes are expected to have resulted in a decline in second-quarter profit levels.
Price Performance
The company’s shares have gained 13.3% in the past three months compared with 17.4% rise of the industry it belongs to.
Zacks Rank & Stocks to Consider
The company currently has a Zacks Rank #3 (Hold). Some better-ranked players in the energy space include NGL Energy Partners LP (NGL - Free Report) and Centennial Resource Development, Inc. , each holding a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
NGL Energy Partners’ bottom line for second-quarter 2020 is expected to rise 92.7% year over year.
Centennial Resource’s second-quarter earnings estimates have improved over the past 30 days, with two upward estimate revisions and no downward movement.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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