Oil & Gas exploration and production (E&P) company, Denbury Resources Inc (DNR - Free Report) ,has temporarily abandoned operations and all productions at its Houston area fields.
The rampage caused by Tropical Storm Harvey was beyond expectation, leading to shut down of production of about 16,000 barrels of oil equivalent per day by Denbury. Denbury’s affected fields comprises ofHastings, Oyster Bayou, Conroe, Thompson, Webster and Manvel.
While no major harm outside of localized flooding has been accounted at any of these fields, it will be impossible to establish the full brunt of the storm for several days. As a precautionary measure, the company has completed the evacuation of employees and contractors.
Harvey is only a little more than half the magnitude of Cyclone Debbie, the largest tropical storm witnessed by the world this year. The storm has exceeded even the most pessimistic of forecasts, discarding record amounts of rain and creating a devastating flood of unbelievable extent.
The storm developed swiftly in the Gulf of Mexico, where it had all the correctelements — an area of low pressure combined with warmer-than-average waters and favorable atmospheric conditions. All these factors strengthened Harvey from a category one system to a category four. Average sustained wind speeds increased to 215 kilometer per hour (kph) from 140kph in just over 24 hours.
Communities in Southern Texas are expected to receive heavy rain and damaging winds from Category four Hurricane Harvey. Another factor contributing to Harvey's mass destruction is its lack of movement.
Denbury is a growing E&P company engaged in the acquisition, development, operation, and exploration of oil and natural gas properties in the Gulf Coast and Rocky Mountain regions of the U.S. As Denbury operates extensively in the Gulf area, the extent of damage to its assets in the area would be evaluated only after several days. Moreover, over the last three months, shares of Denbury have lost 42.7% compared with the industry’s decrease of 12.4%.
Zacks Rank & Stock Picks
Currently, Denbury carries a Zacks Rank #3 (Hold). A few better-ranked players in the energy sector include TransCanada Corporation (TRP - Free Report) , Transmontaigne Partners LP (TLP - Free Report) and Range Resources Corporation (RRC - Free Report) . All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Headquartered in Calgary, Canada, TransCanada is a midstream energy firm in North America. The company delivered an average positive earnings surprise of 4.06% over the last four quarters.
Transmontaigne, headquartered in Denver, CO, involves in transporting and storing refined petroleum products. The firm delivered an average positive earnings surprise of 6.60% over the last four quarters.
Based in Fort Worth, TX, Range Resources is an independent oil and gas company, engaged in the exploration, development and acquisition of U.S. oil and gas resources. The company’s 2017 earnings are estimated to grow 1587.17%.
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