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SECTOR COMMENTARY:
Energy stocks are set to open higher, lifted by higher broader equity futures and despite weaker oil prices. Earnings continue to come in across the E&P, driller and downstream space. Falling yields and expectations for a more moderate, if any, recession in 2023 are continuing to add support to equities and risk assets early in 2023.
Oil prices dipped in U.S. trading hours on Thursday after the country’s oil inventories hit their highest in months and on signs that the Federal Reserve could keep raising interest rates. “Relentlessly rising U.S. commercial inventories and potentially entrenched inflation limit any immediate upside potential,” said PVM analyst Tamas Varga. He said recovering Chinese demand and falling inflation were set to support oil prices in the second half of the year.
Natural gas futures are higher by 2 cents ahead of weekly inventory data. Analysts expect a draw of 125 bcf in today’s weekly inventory report.
BY SECTOR:
US INTEGRATEDS
No significant news.
INTERNATIONAL INTEGRATEDS
Investors in Saudi Aramco‘s gas pipelines network, led by BlackRock have begun a sale of dollar bonds in three tranches to refinance a multi-billion dollar loan that backed their stake purchase, a bank document showed.
Vaar Energi, majority owned by Italy’s Eni, said it has made an oil discovery near its Goliat field in the Arctic Barents Sea.
Pareto Securities upgraded Equinor to Buy from Hold.
Petrobras said its total sales volumes grew slightly in the last three months of 2022, up 0.6% from a year earlier.
CANADIAN INTEGRATEDS
No significant news.
U.S. E&PS
APA announced the successful drilling and flow testing of the Sapakara South-2 (SPS-2) appraisal well, the second appraisal well to test the previously announced discovery. The well is located approximately 4.6 kilometers (3 miles) south of the Sapakara South-1 (SPS-1) appraisal well.
EOG Resources announced the appointment of Lynn A. Dugle to its Board of Directors, effective March 1, 2023. Dugle served as Chief Executive Officer of Engility Holdings, a publicly traded engineering and technology consulting company, from 2016 until the sale of the company in 2019. Dugle previously served more than a decade in senior management positions at Raytheon Company, including Vice President, Engineering, Technology and Quality, and President of Intelligence, Information and Services. Before joining Raytheon in 2004, Dugle held international and officer-level positions with ADC Telecommunications. Dugle began her career at Texas Instruments.
Benchmark started with Kosmos Energy with a Buy rating.
RANGE RESOURCES announced that fourth quarter 2022 production averaged approximately 2,204 Mmcfe per day. In addition, Range realized $24.5 million in contingent derivative settlement gains in fourth quarter 2022.
Talos Energy announced that all of the proposals related to its previously announced acquisition of EnVen Energy Corporation were approved by the requisite holders of Talos common stock at the Company’s special meeting of stockholders held on February 8, 2023. The final voting results from the Special Meeting will be reported in a Current Report on Form 8-K to be filed with the Securities and Exchange Commission after certification by the Company’s inspector of elections.
CANADIAN E&PS
No significant news.
OILFIELD SERVICES
No significant news.
DRILLERS
PATTERSON-UTI ENERGY reported financial results for the quarter ended December 31, 2022. The Company reported net income of $100 million, or $0.46 per share, for the fourth quarter of 2022, compared to net income of $61.5 million, or $0.28 per share, for the third quarter of 2022. Revenues for the fourth quarter of 2022 were $788 million, compared to $728 million for the third quarter of 2022.
Precision Drilling announced 2022 fourth quarter and year-end financial results. Realized $511 million of revenue during the quarter, an increase of 73% over the same period last year and 19% compared with the third quarter of 2022. Achieved Adjusted EBITDA of $91 million, a 43% increase from the 2021 quarter as we continue to maximize our operating leverage in a growing activity environment. Current quarter Adjusted EBITDA included $75 million of share-based compensation charges.
REFINERS
The board of directors of Phillips 66 has declared a quarterly dividend of $1.05 per share on Phillips 66 common stock, representing an 8% increase. The dividend is payable on March 1, 2023, to shareholders of record as of the close of business on Feb. 21, 2023.
MLPS & PIPELINES
DCP Midstream reported its financial results for the quarter and year ended December 31, 2022. For the respective quarter and year ended December 31, 2022, DCP had net income attributable to partners of $261 million and $1,052 million, net cash provided by operating activities of $607 million and $1,882 million, adjusted EBITDA of $347 million and $1,699 million, and distributable cash flow of $213 million and $1,243 million. Record financial performance resulting in increases in adjusted EBITDA of 32%, distributable cash flow of 43%, and excess free cash flow of 23%, year-over-year.
Plains All American Pipeline and Plains GP Holdings reported fourth-quarter and full-year 2022 results, announced 2023 guidance and provided the following highlights: Fourth-quarter and full-year 2022 Net income attributable to PAA of $263 million and $1.04 billion, respectively, and 2022 Net cash provided by operating activities of $335 million and $2.41 billion, respectively. The company expected full-year 2023 Adjusted EBITDA attributable to PAA of $2.45 – $2.55 billion and year-end 2023 leverage of +/- 3.5x.
MARKET COMMENTARY
U.S. stock index futures rose, and European shares hit record highs as a slew of earnings euphoria offset worries that the Federal Reserve will continuing its rate hike cycle. Japan’s Nikkei ended lower, tracking downbeat overnight performances on Wall Street. China and Hong Kong shares eked out small gains on hopes of China’s economic recovery and upbeat U.S.-China relations. A fall in dollar helped gold gain momentum as traders wait for cues on Fed’s policy path from U.S. economic data next week.
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.
This communication and the content found by following any link herein are being provided to you by Corporate Solutions, a business of Nasdaq, Inc. and certain of its subsidiaries (collectively, “Nasdaq”), for informational purposes only. Nasdaq makes no representation or warranty with respect to this communication or such content and expressly disclaims any implied warranty under law. Sources include Reuters, TR IBES, WSJ, The Financial Times and proprietary Nasdaq research.
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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