Editor’s Note: Related Tickers: SandRidge Energy Inc. (NYSE:SD), Exxon Mobil Corporation (NYSE:XOM), Chesapeake Energy Corporation (NYSE:CHK), Transocean LTD (NYSE:RIG)
ANALYSIS – TPG-Axon won’t find quick fixes for SandRidge (Reuters)
Hedge fund TPG-Axon Capital has won nearly half the seats on SandRidge Energy Inc. (NYSE:SD)’s board but faces an uphill battle to reverse the oil and gas company’s slumping stock price. SandRidge shares have tumbled 20 percent this year to around $5 on disappointing forecasts for its wells in Oklahoma and Kansas, as well as investor uncertainty over its strategic direction. While natural gas prices have risen from last year’s 10-year lows, they remain depressed, adding pressure to SandRidge Energy Inc. (NYSE:SD) and peers like Chesapeake Energy Corp and Hess Corp to cut costs and improve well efficiency.
Exxon Mobil Corporation (NYSE:XOM) has now confirmed that on Tuesday, the Pegasus pipeline that has been out of service since it spilled thousands of barrels of oil into Mayflower, Arkansas in March spilled some more into a yard in Missouri. In the town of Doniphan about 190 miles north of Mayflower, a resident reported seeing some oil and dead vegetation in the yard. Though small in scope, perhaps as little as 42 gallons, the spill is a reminder that oil is messy, tar sands oil particularly so, and transporting it across the country is extremely risky. More pressing is the missing oil in Mayflower from the spill last month. The Sierra Club requested the accident incident report, which said that 3,000 barrels of oil (some 126,000 gallons) have not been recovered no matter how energetic Exxon Mobil Corporation (NYSE:XOM)’s response was.
Chesapeake pumping more oil (The Steubenville Herald-Star)
Chesapeake Energy Corporation (NYSE:CHK)’s Shawn Couch Well in Ohio County yielded daily averages of 505 barrels of oil and 290 barrels of natural gas liquids during the first three months of this year. “We are capitalizing on pad drilling efficiencies wherever possible and leveraging our substantial investments in roads, well pads, gathering lines and compression and processing facilities,” said Chesapeake’s Acting Chief Executive Officer Steven Dixon in announcing his company’s earnings report this week. The Oklahoma City-based driller, long-known as a natural gas producer, continues its shift toward developing crude oil and NGL, as company-wide oil production jumped 56 percent from last year to an average of 103,000 barrels per day. This helped Chesapeake earn $1.134 billion during the first quarter of 2013, an increase of 35 percent compared to the same period in 2012.
Transocean Releases Presentation Refuting Carl Icahn’s Inaccurate and Misleading Statements (Marketwire)
Transocean LTD (NYSE:RIG) today released a presentation to its shareholders addressing assertions made by Carl Icahn, including claims that Transocean believes to be inaccurate and misleading. Furthermore, the company believes Mr. Icahn’s proposals are misguided and highlight his poor understanding of the cyclical and capital-intensive nature of the offshore drilling industry. In addition to refuting Mr. Icahn’s claims, the presentation provides compelling support for the company’s highly qualified slate of Director nominees and reiterates that the Board’s proposed $2.24 per share dividend will maximize value creation for our shareholders.
SandRidge changes plans for new buildings (NewsOK.com)
SandRidge Energy Inc. (NYSE:SD) is halting expansion of its campus and converting two buildings under construction — the Braniff Building and the 120 Robert S. Kerr building — into leasable office space. Both buildings originally were intended to accommodate SandRidge Energy Inc. (NYSE:SD) as it was on track to employ 1,500 people. But with a cutback in spending taking place after a proxy fight waged with investor group TPG-Axon, the company has sold off its…
