Prompt Oil Price ($/bbl) $25.32 $2.72 12.0% Let’s follow these … · 2020-04-06 · Oil Prices...

1

April 6, 2020

IndicatorCurrent

Value

Week's

Change

%

Change Direction

Prompt Oil Price ($/bbl) $25.32 $2.72 12.0%

Prompt Gas Price ($/mmbtu) $1.55 ($0.09) (5.2%)

Wkly Trans. Value ($mm) $12 $11 nmf

Wkly Trans. Count 2 -- --

US Rig Count 664 (64) (8.8%)

US Oil Prod'n (mmbbl/d) 13.0 -- --

US Gas Prod'n (bcf/d)(1) 115.5 (1.0) (0.8%)

US Oil Storage (mmbbl) 469.2 13.8 3.0%

US Gas Storage (tcf) 2.0 (0.0) (0.9%)

$2.2

$8.0

$9.9 $10.7

$4.9

$15.8

$21.2 $21.9 $24.1

$17.0

$9.1 $9.2

$20.8

$8.2

$31.6

$19.5

$1.7

$17.0

$10.8

$0.9

--

50

100

150

200

250

300

350

400

450

500

--

$5

$10

$15

$20

$25

$30

$35

$40

1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20

61% 83% 74% 79% 39% 52% 62% 71% 93% 24% 68% 82% 91% 64% 46% 93% 51% 95% 74% 80% 63%

Nu

mb

er

of

Tra

ns

ac

tio

ns

Tra

ns

ac

tio

n V

alu

e (

$b

n)

Asset Corporate Number of Transactions

% Oil% Oil% Oil

$64.3

OPEC announced that it will call an emergency meeting on

Monday, April 6th, to discuss potential supply cuts; the

meeting will be held by video conference and will include

Russia and other producers outside of OPEC

President Trump announced that the U.S., Saudi Arabia,

and Russia will meet to discuss measures to relieve the

energy industry so badly affected by the coronavirus

With developments around COVID-19 in constant flux, BMO

Capital Markets has set up a dedicated page to provide

clients with the latest news and information, from the market

response to developments in the fight against the virus and

its spread – read more here

Debt

Markets

Five issuers priced five tranches for approximately $6.9 billion in proceeds last week

U.S. high yield funds reported an inflow of $7.1 billion

ETFs reported an inflow of $2.9 billion, while mutual funds reported an inflow of $4.2 billion

High yield index yield was 9.64%; high yield energy index yield was 20.37%

Source: BMO Transaction Database, Baker Hughes, BMO Commodity Products Group, Bloomberg, EIA, PLS

Note: Current quarter’s data is through the week covered by this issue.

1. EIA U.S. natural gas gross withdrawals and production reported monthly as of Jan 2020.

2. S&P E&P = S&P Oil & Gas E&P Select Industry, SPX = S&P 500 Index.

Key Industry Indicators

Quarterly Deal Activity

S&P E&P(2) outperformed last week 5.1% vs. SPX(2) (0.6)%

The U.S. equity indexes mostly finished down last week. Consumer discretionary, materials, real estate,

industrials, financials, and tech all finished down. Healthcare and consumer staples finished up

Equity

Markets

Oil ended last week up. Last Thursday, U.S. oil prices jumped 25% in their largest one-day rally.

Investors’ hopes rose due to the initial steps announced by Trump to end a global price war, offering a

relief to the energy industry. President Trump stated the U.S. will meet with Saudi Arabia and Russia to

stop the historic plunge in oil prices and stabilize the energy markets. The U.S. Energy Department

announced it withdrew a March 19 tender for the first part of its plan to purchase 77 mmbbls for the

reserve after failing to win funding from Congress. The Keystone XL pipeline, which has faced

environmental opposition and many court challenges for years, received approval to begin construction

following a surprise $5.3 billion financial aid package from Alberta. Construction will begin in April. U.S.

gasoline prices fell to their lowest average cost in four years – below $2 per gallon. The near-term

contract closed up $2.72, or 12.0%, at $25.32

Gas ended last week down. Concerns continued over the lack of demand caused by COVID-19

shutdowns. The EIA reported a smaller than expected withdrawal of 19 bcf. The near-term contract

closed down $0.09, or 5.2%, at $1.55

Commodities

Week in Review

Let’s follow these guidelines when sorting articles:

• First priority: Domestic A&D, ranked by size

• Next: Domestic M&A

• Then: US companies doing international deals (like

Noble’s Tamar)

• Then: Others (Cabot’s Lackawanna)

• Then: Prices, rig count, completions, etc.

To paste the arrows with colors,

• FactSet

• Settings

• Presentation Linking and Formatting

• Import

• Colors

• Change Color Font Covering the Week of March 27 to April 2, 2020

This is the final issue for 2018. The Market Monitor will

return on Monday, January 7th. Happy Holidays from the

BMO Capital Markets team!

BMO is marketing PayRock Energy’s divestiture of South

Texas Eagle Ford assets (see page [x])

The October issue of BMO Calgary’s A&D (Canadian) Market

Monitor went live last week – read more here

One E&P deal priced last week

WPX Energy (b1/BB-) priced $600 million of x% Senior

Notes due 2027

One E&P issuer priced last week

Noble Energy priced $500 million of 3.25% senior notes

due 2029 and $500 million of 4.20% senior notes due

2049. BMO Capital Markets acted as a Joint

Bookrunner on this transaction

All references to last week in the comments below are through Thursday

Equities continued sharply down once again, seemingly on an every-other-day schedule, due to coronavirus concerns. The U.S. cut rates by 50

bps, which seemed to catch the market off guard. The U.S. 10 year yield reached a low of sub-0.90%. OPEC made a proposal to cut production

by 1.5 mmbpd, albeit without Russia on board. If Russia doesn’t commit that puts the heavy lifting on Saudi Arabia, although Saudi Arabia

threatened to abandon cuts altogether if Russia doesn’t join the party. With regards to the virus, U.S. fatalities are still limited. For perspective,

the CDC estimate for flu-related deaths in the U.S. just this season is 18,000. Crude oil inventory numbers in the U.S. were mixed between

bullish and bearish.

It was another volatile week across markets as cash prices fell and then continued trending down based on a lower than expected gas draw.

The weather is expected to be warmer than normal with warmer changes shifting from the Southwest toward the East, while very large colder

changes develop across the Western Halt.

[TBU]

[TBU]

[TBU]

[TBU]

https://capitalmarkets.bmo.com/en/covid-19-insights/

http://click.bmocapitalmarkets.bmo.com/?qs=06431ffcb9e46ff9ceb552c71599979cce1497589a985c6f6db2bcdad857fec824bec1ef9245eef7759c94d656a26e446b38de2e8b6d3a20

2

April 6, 2020

y = 21.998e-0.061x

R² = 0.2683

--

$10

$20

$30

$40

$50

$60

-- 5.0x 10.0x 15.0x 20.0x 25.0x 30.0x

Sa

les

Pri

ce

/ P

rove

d R

es

erv

es

($

/bo

e @

15

:1)

R / P

R / P

Sales Value /

Proved Reserves

(15:1)

(ratio) ($ / boe) ($ / mcfe)

8x $13.56 $0.90

10x $12.01 $0.80

15x $8.88 $0.59

20x $6.56 $0.44

$5.1

$15.3 $11.4

$1.7 $0.9

$0.0

$8.8 $9.6

$0.1 $0.0

$5.2

$24.1 $21.0

$1.8 $0.9

2016 2017 2018 2019 2020

239 450 367 60 30

Asset Corporate

Deal Count

Public Company

46%

PE / PE-Backed

18%

Private10%

Other26%

LTM By Buyer Type

Ann'd

Date Buyer Seller Area Asset Description Value(1)

Proved

Multiple

Prod.

Multiple Net Acres

($mm) ($/boe) ($/boe/d) ($/acre)

26-Feb-20 Undisclosed Buyer HighPoint Resources Multi-Region Multi-region non-op assets $27 n.a. $13,500 n.a.

14-Feb-20 Undisclosed Buyer Lilis Energy Inc Permian 1,185 net acres in Delaware Basin $25 n.a. n.a. $21,013

12-Feb-20 Laredo Petroleum Inc Undisclosed Seller Permian 1,100 net acres in Midland Basin $23 n.a. n.a. $20,455

04-Feb-20 Alpine Energy Capital Approach Resources Permian 113,000 net acres in Midland Basin $193 $1.07 $20,522 $1,704

31-Jan-20 Undisclosed Buyer ConocoPhillips Other Rockies 98,000 net acres in DJ Basin $380 $27.14 $34,545 $3,878

24-Jan-20 KeyBank EdgeMarc Energy Holdings Marcellus/Utica 32,217 net acres in Pennsylvania $70 $0.53 $4,806 $2,163

09-Jan-20 Kimbell Royalty Partners Springbok Energy Partners Multi-Region 2,160 net royalty acres across the U.S. $175 n.a. $69,088 nmf

31-Dec-19 Brigham Minerals LLC Undisclosed Seller Multi-Region 3,000 net royalty acres in multiple basins $38 n.a. n.a. nmf

31-Dec-19 BCE-Mach III LLC Alta Mesa Resources Mid-Continent 128,000 net acres in STACK $232 $3.36 $6,610 $1,813

22-Dec-19 Navitas Petroleum LP Denbury Resources Other 50% WI in conventional Texas assets $50 $13.51 $47,619 n.a.

Blue = BMO provided transaction advisory services Green = BMO provided acquisition financing or related services

Purple = BMO provided both transaction advisory services and acquisition financing or related services

Permian20%

Rockies (ex. Bakken)

7%

Bakken4%

Appalachia7%

Mid-Con13%

Eagle Ford6%

Ark-La-Tex4%

Gulf of Mexico8%

Other31%

LTM By Region

Oil54%

Gas46%

LTM By Commodity

The 10 Most Recent Asset Transactions Over $20 Million

A&D Valuation Trends(3)

Source: BMO Transaction Database, Baker Hughes, BMO Commodity Products Group, Bloomberg, PLS

1. Represents total enterprise value. 2. Calculated as percentage of total LTM transaction count (number of transactions, not dollar value).

3. 68 transactions from January 2015 to 2019 with transaction value >$20mm. Adjusted for changes in price outlooks. Recalculated boe reserves are on a 15:1

(gas:oil) basis. Acreage transactions excluded by using deals with PDP of >= 40% of total proved.

4. Year-to-date data is through this week’s date for each respective year.

(2) (2) (2)

Confirm number of transactions weekly --->

Deal Activity – YTD ($bn)(4)

[TBU]

[TBU]

[TBU]

[TBU]

3

April 6, 2020

4/2/2020

Appalachia 2

Ark-La-Tex 1

Bakken 2

Eagle Ford 6

Mid-Con 4

Other 3

Permian 4

Rockies 5

27

Select Significant Deals on the Market

Disclaimer: The foregoing links are for convenience only and relate to materials that were not prepared or reviewed by BMO Capital Markets. BMO Capital Markets takes

no responsibility for and makes no representations with respect to the contents thereof. These materials may be inconsistent with the views of BMO Capital Markets.

Source of Select Significant Deals on the Market: BMO Transaction Database

Source of Headlines: Press releases

Industry Headlines

(Click headline to link to the full article)

M&A&D Headlines

Appalachia

2 Deals

Mid-Con

4 Deals

Eagle Ford

6 Deals

Permian

4 Deals

Other

3 Deals

Rockies

5 Deals

Bakken

2 Deals

Ark-La-Tex

1 Deals

BMO Deals (Status)

Siltstone Appalachia (In Market) – See page 6

Oil Prices March Higher as OPEC Calls For

Emergency Meeting on Monday

U.S., Saudi, and Russia to Meet on Market Crash

18-Year Low Oil Prices Prompt U.S.-Russia Talks

Plan

Goldman Sachs Sees Shale Ultimately Victorious in

the Oil War

Oil Industry Experts Say Shale Will Rise Again

U.S. Renewable Energy Increased in 2019

Energy Department Withdraws Tender to Fill Strategic

Petroleum Reserve

Talos Energy Announces Full Year 2019 Operating

and Financial Guidance (includes A&D

announcement)

+ the EQT mineral/JV Deal

+ Antero ORRI deal

[TBU]

[TBU]

[TBU]

https://www.cnn.com/2020/04/03/business/oil-prices-opec-meeting/index.html

https://www.cnn.com/2020/04/03/business/oil-prices-opec-meeting/index.html

https://www.rigzone.com/news/wire/us_saudi_and_russia_to_meet_on_market_crash-01-apr-2020-161599-article/



https://www.cnbc.com/2020/03/31/oil-markets-us-russia-oil-market-talks-in-focus.html







https://www.worldoil.com/news/2020/4/1/goldman-sachs-sees-shale-ultimately-victorious-in-the-oil-war

https://www.worldoil.com/news/2020/4/1/goldman-sachs-sees-shale-ultimately-victorious-in-the-oil-war

https://www.rigzone.com/news/wire/oil_industry_experts_say_shale_will_rise_again-27-mar-2020-161547-article/

https://www.reuters.com/article/us-global-oil/oil-jumps-5-to-over-28-on-fed-steps-to-support-economy-idUSKBN21915O

https://nawindpower.com/2019s-u-s-renewable-energy-increases

https://www.worldoil.com/news/2020/3/26/energy-department-withdraws-tender-to-fill-strategic-petroleum-reserve

https://www.worldoil.com/news/2020/3/26/energy-department-withdraws-tender-to-fill-strategic-petroleum-reserve

https://www.prnewswire.com/news-releases/talos-energy-announces-full-year-2019-operating-and-financial-guidance-300779250.html



4

April 6, 2020

Saudi Arabia has announced their aim to deliver 12.3 mmbbl/d beginning in April, while their 10

year peak production at any point has been 11 mmbbl/d

Saudi Arabia has never managed to sustainably produce over 10.1 mmbbl/d; can they deliver a

sustainable 20% increase?

While 12 mmbbl/d may be possible for a limited period (3-6 months?), sustaining these levels

may prove challenging, especially in light of Aramco’s decision to cut spending by ~23%

President Trump announced on Thursday, April 2nd, that the U.S., Saudi Arabia, and Russia will

meet to discuss ways to end the current global price war – potentially leading to a production cut

agreement

Market Insight: Saudi Production Over the Past Decade

Sources: Bloomberg, EIA

SAUDI ARABIA OIL PRODUCTION (MMBBL/D)

20

40

60

80

100

120

140

6

7

8

9

10

11

12

13

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Bre

nt P

rice (

US

$ /

bbl)

Saudi A

rabia

Pro

ductio

n (

mm

bbl /

d)

Brent Price Saudi Arabia Saudi Arabia 2020

Mid 2011-2015

Average: 9.7 mmbbl/d

2015-2019

Average: 10.1 mmbbl/d

Saudi announce plans to

increase production to 12

mmbbl/d in April 2020

4

2

OPEC cut

OPEC agrees to cut oil

production by 1.2 mmbbl/d

Attack on Saudi Aramco

facilities by Iranian

forces

3

OPEC cut

OPEC reaches agreement to cut

oil production to 32.5 mmbbl/d

1

No OPEC Production Cuts from 2008-2016

5

April 6, 2020

Historical Prices as of 02-Apr-20 Close ($/gal)

NGLs Current Last Wk. 6 Mo. Ago 1 Yr. Ago

Ethane $0.10 $0.11 $0.19 $0.21

Propane $0.27 $0.24 $0.43 $0.64

Butane $0.27 $0.26 $0.53 $0.64

Iso-butane $0.33 $0.31 $0.81 $0.79

Pentane+ $0.36 $0.41 $1.05 $1.28

25%

35%

45%

55%

65%

Jan-17 Jul-17 Jan-18 Jul-18 Jan-19 Jul-19 Jan-20

% o

f W

TI

NGL as % of WTI

NYMEX Gas Futures as of 02-Apr-20 Close ($/mmbtu)

Period(1) Current Last Wk. 6 Mo. Ago 1 Yr. Ago

12 Mo. Strip $2.20 $2.16 $2.39 $2.85

2020 $1.98 $2.00 $2.42 $2.75

2021 $2.50 $2.44 $2.45 $2.66

2022 $2.40 $2.35 $2.52 $2.67

2023 $2.39 $2.38 $2.59 $2.76

2024 $2.40 $2.40 $2.66 $2.87

$1

$2

$3

$4

$5

Apr-19 Oct-19 Apr-20 Oct-20 Apr-21

($/m

mb

tu)

NYMEX WTI Futures as of 02-Apr-20 Close ($/bbl) NYMEX Gas Futures as of 02-Apr-20 Close ($/mmbtu)

Period(1) Current Last Wk. 6 Mo. Ago 1 Yr. Ago

12 Mo. Strip $31.63 $30.78 $51.25 $61.69

2020 $30.41 $29.25 $50.80 $59.77

2021 $35.20 $35.16 $49.63 $56.69

2022 $37.92 $38.14 $49.90 $54.51

2023 $39.96 $40.10 $50.64 $53.45

2024 $41.93 $41.71 $51.45 $53.09

$20

$30

$40

$50

$60

$70

$80

Apr-19 Oct-19 Apr-20 Oct-20 Apr-21

($/b

bl)

NGL PRICING(2)

HENRY HUB NATURAL GAS (HISTORICAL / FORECAST)

Commodity Prices

Source: BMO Commodity Products Group, Bloomberg, FactSet

1. Future prices are calendar year average unless stated otherwise.

2. Assumes typical Gulf Coast barrel composition.

WTI OIL (HISTORICAL / FORECAST)

Links:

http://www.nasdaq.com/markets/crude-oil.aspx

http://www.bloomberg.com/quote/CL1:COM

http://www.nasdaq.com/markets/natural-gas.aspx

http://www.bloomberg.com/quote/NG1:COM

Link to Detailed

Futures Data

Link to Detailed

Historical Graph

Link to Detailed

Futures Data

Link to Detailed

Historical Graph [TBU]

[TBU]

[TBU]














http://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude.html

http://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude.html



http://www.cmegroup.com/trading/energy/natural-gas/natural-gas.html

http://www.cmegroup.com/trading/energy/natural-gas/natural-gas.html



6

April 6, 2020

($3.57)

$25.32

$1.55

Clearbrook

Midland

Cushing

St. James

(LLS)

East Coast

U.S. (Brent)

Midland Sweet-

Sour Spread

EMS

AECO

Northern

California

Sumas

Southern

California

El Paso - SJ

Waha

HSC

Henry Hub

Panhandle

CIG Chicago

Dominion

Transco

NATURAL GAS PRICING & DIFFERENTIALS TO HENRY HUB ($ / MMBTU) – AS OF 2-APR-20

Commodity Prices (cont’d)

OIL PRICING & DIFFERENTIALS TO CUSHING WTI ($ / BBL) – AS OF 2-APR-20

Legend

Price

Diff.

Legend

Price

Diff.

$29.94

$4.62

$2.20

$0.65$1.39

($0.16)

$0.99

($0.56)$1.10

($0.45)

$1.10

($0.45)

$1.16

($0.39)

$9.32

($16.00)

$1.29

($0.26)

$1.12

($0.43)

$22.50

($2.82)

Source: BMO Commodity Products Group, Bloomberg

Note: Prices and differentials are for prompt month futures except for Clearbrook which is based on spot prices.

MAPS IN

MASTER VIEW

$21.36

($3.96)

$1.09

($0.46)

$1.54

($0.01)

$1.08

($0.47)

$0.46

($1.09)

[TBU]

$12.72

($12.60)

[TBU]

[TBU]

7

April 6, 2020

Item Value Wkly Change Last Week Item Value Wkly Change Last Week

Rig Count 351 (31) 382 Oil Differential ($4.50) -- ($4.50)

Permitting Activity 90 (69) 159 Gas Differential ($1.06) $0.35 ($1.41)

0%

10%

20%

30%

40%

50%

60%

--

100

200

300

400

500

Jan-15 Jan-16 Jan-17 Jan-18 Jan-19 Jan-20

H V+D % of Total Rigs

-$4.80

-$3.20

-$1.60

$0.00

$1.60

Jan-15 Jul-16 Jan-18 Jul-19

-$18.00

-$12.00

-$6.00

$0.00

$6.00

$ /

mm

btu

$ /

bb

l

Midland Waha

1,050

1,256

900784

753595

851 744 803966

840696

11

Apr-19 Jun-19 Aug-19 Oct-19 Dec-19 Feb-20 Apr-20

H V+D

--

$20,000

$40,000

$60,000

$80,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

1Q

20

1 2 8 8 6 6 12 13 15 7 2 2 7 2 5 4 1 2 0 4 0

$ /

acre

# Deals

$24,791

--

$50,000

$100,000

$150,000

$200,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

1Q

20

1 2 6 9 5 7 11 9 9 6 1 0 7 2 5 4 1 2 4 4 1

$ /

bo

e/d

# Deals

$85,855

GROSS PRODUCTION

TRANSACTION ACTIVITY (EXCLUDES CORPORATE DEALS)

TRANSACTION PRODUCTION MULTIPLES(3) TRANSACTION ADJUSTED NET ACRE MULTIPLES(3,4)

PERMITTING ACTIVITY BY MONTH

DIFFERENTIALS

Permian Snapshot

RIG COUNT

Ann'd

Date Buyer Seller Asset Description Value(1)

Proved

Multiple

Prod.

Multiple Net Acres

($mm) ($/boe) ($/boe/d) ($/acre)(2)

14-Feb-20 Undisclosed Buyer Lilis Energy Inc 1,185 net acres in Delaware Basin $25 n.a. n.a. $21,013

12-Feb-20 Laredo Petroleum Inc Undisclosed Seller 1,100 net acres in Midland Basin $23 n.a. n.a. $20,455

04-Feb-20 Alpine Energy Capital Approach Resources 113,000 net acres in Midland Basin $193 $1.07 $20,522 $1,704

09-Dec-19 Laredo Petroleum Inc Undisclosed Seller 4,475 net acres in Midland Basin $65 n.a. $46,429 $14,525

05-Nov-19 Laredo Petroleum Inc Cordero Energy 7,360 net acres in Permian $130 n.a. n.a. $17,697

Mean $87 $1.07 $33,475 $15,079

Median $65 $1.07 $33,475 $17,697



Source: BMO Transaction Database, Baker Hughes, BMO Commodity Products Group, Bloomberg, Drilling Info, PLS


1. Represents total enterprise value. Excludes transactions with deal value <$20 million. 2. $/acre multiple not adjusted for value associated with production.

3. Red line denotes average since 01-Jan-18. Calculated as the weighted average of each quarter’s transactions.

4. Production valued at $45,000/boepd in 2014, $30,000/boepd in 2015, $35,000/boepd in 2016 & 2017, $40,000/boepd in 2018 & 2019, and $35,000/boepd in 2020.

5,000

7,000

9,000

11,000

13,000

15,000

17,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

Jan-15 Oct-15 Jul-16 Apr-17 Jan-18 Oct-18 Jul-19

mm

cf/

d

mb

bl/

d

Oil Gas 4,498

15,967

[TBU]

[TBU]

[TBU]

8

April 6, 2020


Rig Count 62 (6) 68 Oil Differential ($3.25) ($0.75) ($2.50)


0%

5%

10%

15%

20%

--

100

200

300



-$0.30

-$0.20

-$0.10

$0.00

$0.10

$0.20

$0.30

$0.40

$0.50


-$6.00

-$4.00

-$2.00

$0.00

$2.00

$4.00

$6.00

$8.00

$10.00

$ /

mm

btu

$ /

bb

l

MEH HSC

351401

222173 201 188

221204

204

301

170 180

0


H V+D

6,000

6,500

7,000

7,500

8,000

1,000

1,200

1,400

1,600

1,800


mm

cf/

d

mb

bl/

d

Oil Gas

1,439

7,448

Ann'd

Date Buyer Seller Asset Description Value (1)

Proved

Multiple

Prod.

Multiple Net Acres

($mm) ($/boe) ($/boe/d) ($/acre)(2)

12-Nov-19 Kimbell Royalty Partners Buckhorn Resources 400 net royalty acres in Eagle Ford $32 n.a. $117,752 nmf

07-Nov-19 Repsol Equinor 100% ow nership in former Eagle Ford JV $325 n.a. $9,559 $7,476

06-Nov-19 Marathon Rocky Creek & Delago 18,000 net acres in Eagle Ford $185 n.a. $26,429 $10,278

17-Jul-19 Undisclosed Buyer Sundance Energy 6,100 net acres in Dimmit County $30 n.a. $28,069 $4,836

19-Nov-18 Lonestar Resources Inc Sabine Oil & Gas Corp 2,706 net acres in Eagle Ford $39 $2.98 $48,375 $14,302

Mean $122 $2.98 $46,037 $9,223

Median $39 $2.98 $28,069 $8,877

Blue = BM O provided transaction advisory services Green = BM O provided acquisit ion f inancing or related services

Purple = BM O provided both transaction advisory services and acquisit ion f inancing or related services

--$10,000$20,000$30,000$40,000$50,000$60,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

0 1 2 1 2 2 0 4 2 3 1 2 4 2 1 3 0 0 0 0

$ /

acre

# Deals

$8,045

--

$50,000

$100,000

$150,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

1 1 3 1 2 2 2 4 4 3 1 2 7 2 0 3 0 0 1 3

$ /

bo

e/d

# Deals

$66,216

Eagle Ford Snapshot



DIFFERENTIALS RIG COUNT







GROSS PRODUCTION

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

9

April 6, 2020

-$10.00

-$5.00

$0.00

$5.00

$10.00


-$10.00

-$5.00

$0.00

$5.00

$10.00

$ /

mm

btu

$ /

bb

l

LLS Henry Hub



Permitting Activity 10 (5) 15 Gas Differential -- -- --

0%

5%

10%

15%

20%

--

20

40

60

80



116132

100119

198 215

86

141

72 66 62 68

0


H V+D

5,000

6,500

8,000

9,500

11,000

12,500

14,000

60

70

80

90

100

110

120


mm

cf/

d

mb

bl/

d

Oil Gas

77

12,690

--$2,000$4,000$6,000$8,000

$10,000$12,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

0 0 5 1 1 3 2 3 0 2 2 0 1 1 2 1 0 1 1 1

$ /

mcfe

/d

# Deals

$3,983

--

$5,000

$10,000

$15,000

$20,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

0 0 3 1 1 2 1 3 0 1 2 0 1 1 1 1 0 1 1 0

$ /

acre

# Deals

$3,180

Ann'd


Proved

Multiple

Prod.

Multiple Net Acres

($mm) ($/mcfe) ($/mcfe/d) ($/acre)(2)

20-Dec-19 Undisclosed Buyer Riviera Operating LLC 75,873 net acres in East Texas $34 $0.17 $1,213 $448

29-Jul-19 Osaka Gas Sabine Oil & Gas Corp 175,000 net acres in East TX $610 n.a. $2,905 $9,136

19-Dec-18 Comstock Shelby Shale LLC 6,023 net acres in Haynesville $21 n.a. n.a. $3,404

19-Nov-18 Aethon III QEP Resources Inc 49,700 net acres in Haynesville $735 $0.77 $2,475 $14,789

05-Sep-18 Viking Energy Group Multiple Sellers Texas and Louisiana assets $100 n.a. n.a. n.a.

Mean $300 $0.47 $2,198 $6,944

Median $100 $0.47 $2,475 $6,270



Ark-La-Tex Snapshot








4. Production valued at $3,000/mcfepd in 2014, and $2,000/mcfepd in 2015, 2016, 2017, 2018, 2019, and 2020.


GROSS PRODUCTION

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

10

April 6, 2020


Rig Count 48 -- 48 Oil Differential $5.15 $1.41 $3.74


0%

5%

10%

15%

20%

--

50

100

150



-$3.00

-$2.00

-$1.00

$0.00

$1.00

$2.00

$3.00


-$15.00

-$10.00

-$5.00

$0.00

$5.00

$10.00

$15.00

$ /

mm

btu

$ /

bb

l

Brent Dominion

419384

335 348303 295

258232

188150

226 213

0


H V+D

15,000

20,000

25,000

30,000

35,000

80

100

120

140

160


mm

cf/

d

mb

bl/

d

Oil Gas

144

32,228

--$2,000$4,000$6,000$8,000

$10,000$12,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

1Q

20

0 1 0 0 1 2 2 4 2 4 1 3 1 3 2 0 0 0 0 0 0

$ /

acre

# Deals

$564

--$5,000

$10,000$15,000$20,000$25,000$30,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

1Q

20

0 1 0 0 1 2 2 3 2 5 1 4 3 4 3 1 1 0 2 1 1

$ /

mcfe

/d

# Deals

$5,207

Ann'd


Proved

Multiple

Prod.

Multiple Net Acres

($mm) ($/mcfe) ($/mcfe/d) ($/acre)(2)

24-Jan-20 KeyBank EdgeMarc Energy Holdings 32,217 net acres in Pennsylvania $70 $0.09 $801 $2,163

19-Dec-19 Undisclosed Buyer Gulfport Energy Corp Non-op Utica assets $29 n.a. n.a. n.a.

21-Oct-19 Heritage Resources Inc Range Resources Southwest Applachia ORRIs $150 n.a. $15,337 nmf

24-Jul-19 Diversified Gas & Oil EdgeMarc Energy Holdings 12,730 net acres in Ohio Utica $50 $0.32 $769 $3,928

19-Jul-19 Multiple Range Resources Corp Southwest Applachia ORRIs $600 n.a. $15,790 nmf

Mean $180 $0.20 $8,174 $3,045

Median $70 $0.20 $8,069 $3,045



Appalachia Snapshot








4. Production valued at $3,000/mcfepd in 2014, and $2,000/mcfepd in 2015, 2016, 2017, 2018, 2019, and 2020.


GROSS PRODUCTION

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

11

April 6, 2020



Permitting Activity 7 (9) 16 Gas Differential ($0.27) -- ($0.27)

0%

5%

10%

15%

20%

--

50

100

150

200



-$1.00

-$0.50

$0.00

$0.50


-$20.00

-$10.00

$0.00

$10.00

$ /

mm

btu

$ /

bb

l

Clearbrook CIG

138 145 144 154138

110

157

83 80 7965 72

0


H V+D

1,500

1,800

2,100

2,400

2,700

3,000

3,300

3,600

900

1,000

1,100

1,200

1,300

1,400

1,500

1,600


mm

cf/

d

mb

bl/

d

Oil Gas

1,535

3,162

--

$20,000

$40,000

$60,000

$80,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

0 1 1 4 0 2 3 3 0 1 3 3 0 6 3 0 0 1 0 0

$ /

bo

e/d

# Deals

$45,752

--

$5,000

$10,000

$15,000

$20,000

$25,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

0 0 1 2 0 0 2 3 1 0 3 2 0 5 2 0 0 1 0 0

$ /

acre

# Deals

$1,751

Ann'd


Proved

Multiple

Prod.

Multiple Net Acres

($mm) ($/boe) ($/boe/d) ($/acre)(2)

22-Apr-19 Northern Oil and Gas Flywheel Energy LLC 18,000 net acres in Williston Basin $310 n.a. $47,014 $17,238

31-Jul-18 Northern Oil and Gas W Energy Partners 10,600 net acres in Williston Basin $288 n.a. $42,708 $27,196

18-Jul-18 Northern Oil and Gas Pivotal Petroleum Partners LP Producing assets in Williston Basin $152 n.a. $37,032 n.a.

12-Jul-18 PetroShale Inc Slawson Exploration Co 1,981 net acres in Williston Basin $55 $6.04 $100,000 $27,764

06-Jul-18 Energy Resources 12 LP Bruin E&P Partners LLC 2.8% non-operated WI in Bakken assets $83 n.a. n.a. n.a.

Mean $178 $6.04 $56,688 $24,066

Median $152 $6.04 $44,861 $27,196



Bakken Snapshot










GROSS PRODUCTION

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

12

April 6, 2020



Permitting Activity 62 2 60 Gas Differential ($0.27) -- ($0.27)

0%

5%

10%

15%

20%

--

50

100

150



-$1.00

-$0.50

$0.00

$0.50


-$20.00

-$10.00

$0.00

$10.00

$ /

mm

btu

$ /

bb

l

Clearbrook CIG

328

164

306 286

434

327296

168

213267

197

285

2


H V+D

--

$5,000

$10,000

$15,000

$20,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

1Q

20

0 0 3 3 0 1 1 0 1 0 1 5 2 0 2 1 0 0 0 0 0

$ /

acre

# Deals

$2,380

Ann'd


Proved

Multiple

Prod.

Multiple Net Acres

($mm) ($/boe) ($/boe/d) ($/acre)(2)

31-Jan-20 Undisclosed Buyer ConocoPhillips 98,000 net acres in DJ Basin $380 $27.14 $34,545 $3,878

09-Dec-19 YTEF Drilling Capital LLC Bayswater E&P LLC DJ Basin JV $125 n.a. n.a. n.a.

03-Sep-19 Undisclosed Buyer Crescent Point 224,000 net undeveloped acres in Uinta $525 n.a. $32,051 $2,344

14-Feb-19 Undisclosed Buyer Harvest Oil & Gas Corp San Juan Basin assets $43 $1.57 $10,835 n.a.

31-Jan-19 Undisclosed Buyer Extraction Oil & Gas 5,000 net acres in Powder River $22 n.a. n.a. $4,480

Mean $219 $14.36 $25,811 $3,567

Median $125 $14.36 $32,051 $3,878



--$20,000$40,000$60,000$80,000

$100,000$120,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

1Q

20

2 0 4 4 1 6 2 0 1 6 3 9 3 1 3 1 1 0 2 0 1

$ /

bo

e/d

# Deals

$36,112



DIFFERENTIALS

Rockies (excl. Bakken) Snapshot

RIG COUNT







GROSS PRODUCTION

[TBU]

13,000

13,500

14,000

14,500

15,000

15,500

500

600

700

800

900

1,000


mm

cf/

d

mb

bl/

d

Oil Gas976

14,073

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

13

April 6, 2020


Rig Count 33 (10) 43 Oil Differential -- -- --


0%

5%

10%

15%

20%

--

100

200

300

400



-$1.00

-$0.75

-$0.50

-$0.25

$0.00

$0.25


-$1.00

-$0.75

-$0.50

-$0.25

$0.00

$0.25

$ /

mm

btu

$ /

bb

l

Cushing Panhandle

389

298

374 351 326 348 343342 293 283

250191

0


H V+D

--

$5,000

$10,000

$15,000

$20,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

1 3 1 2 0 3 3 2 4 1 2 1 0 0 0 1 0 0 0 0

$ /

acre

# Deals

$4,284

--

$50,000

$100,000

$150,000

$200,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

1 4 1 3 1 6 3 1 4 2 4 5 2 2 5 4 2 0 4 3

$ /

bo

e/d

# Deals

$18,809

Ann'd


Proved

Multiple

Prod.

Multiple Net Acres

($mm) ($/boe) ($/boe/d) ($/acre)(2)

31-Dec-19 BCE-Mach III LLC Alta Mesa Resources 128,000 net acres in STACK $232 $3.36 $6,610 $1,813

10-Dec-19 Dow Devon Energy STACK Basin JV $100 n.a. n.a. n.a.

27-Sep-19 Contango White Star Petroleum LLC 314,800 net acres in Mid-Con $133 $1.57 $8,833 $421

12-Sep-19 Contango Will Energy Corporation TX Panhandle, W. Anadarko, and N.LA $23 n.a. $16,429 $144

28-Aug-19 Scout Energy Partners Riviera Resources Inc Hugoton Basin assets $295 $2.30 $17,020 $295

Mean $157 $2.41 $12,223 $668

Median $133 $2.30 $12,631 $358



Mid-Continent Snapshot










GROSS PRODUCTION

[TBU]

12,000

13,200

14,400

15,600

16,800

18,000

600

650

700

750

800

850


mm

cf/

d

mb

bl/

d

Oil Gas 790

14,222

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

14

April 6, 2020

-$10.00

-$5.00

$0.00

$5.00

$10.00


-$10.00

-$5.00

$0.00

$5.00

$10.00

$ /

mm

btu

$ /

bb

l

LLS Henry Hub


Rig Count 18 -- 18 Oil Differential ($8.00) ($3.50) ($4.50)

Permitting Activity 8 1 7 Gas Differential -- -- --

0%

5%

10%

15%

20%

--

10

20

30

40


Deep Water Shelf % of Total Rigs

2926 27

3128

21 22 22

16

22 22

32

3


Ann'd

Date Buyer Seller Asset Description Value (2)

Proved

Multiple

Prod.

Multiple Net Acres

($mm) ($/boe) ($/boe/d) ($/acre)(3)

12-Dec-19 W&T Offshore ConocoPhillips Deepw ater GOM assets $20 $4.88 $8,696 n.a.

10-Dec-19 Talos Energy Multiple GOM assets and exploration prospects $640 $14.71 $33,684 n.a.

27-Jun-19 W&T Offshore ExxonMobil Mobile Bay assets $200 $2.70 $10,101 n.a.

13-May-19 Equinor Shell 22.45% WI in Caesar-Tonga Field $965 n.a. $60,313 n.a.

23-Apr-19 Murphy LLOG Bluew ater LLC Mississippi Canyon & Green Canyon $1,375 $20.83 $36,184 n.a.

Mean $640 $10.78 $29,796 n.a.

Median $640 $9.79 $33,684 n.a.

Blue = BM O provided transaction advisory services Green = BM O provided acquisit ion f inancing or related services

Purple = BM O provided both transaction advisory services and acquisit ion f inancing or related services

--

$10

$20

$30

$40

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

0 0 1 0 0 0 2 1 0 0 0 1 2 1 0 1 1 2 0 2

$ /

bo

e

# Deals

$15.86

--

$15,000

$30,000

$45,000

$60,000

1Q

15

2Q

15

3Q

15

4Q

15

1Q

16

2Q

16

3Q

16

4Q

16

1Q

17

2Q

17

3Q

17

4Q

17

1Q

18

2Q

18

3Q

18

4Q

18

1Q

19

2Q

19

3Q

19

4Q

19

0 0 1 1 0 0 2 0 0 0 0 1 2 2 2 1 1 3 0 2

$ /

bo

e/d

# Deals

$30,696

Gulf of Mexico Snapshot

PERMITTING ACTIVITY BY MONTH(1)




1. Permits include directional and unidentified drilling permits. 2. Represents total enterprise value. Excludes transactions with deal value <$20 million.

3. $/acre multiple not adjusted for value associated with production.


GROSS PRODUCTION


TRANSACTION PRODUCTION MULTIPLES(4) TRANSACTION PROVED RESERVE MULTIPLES(4)

[TBU]

2,000

2,500

3,000

3,500

4,000

4,500

1,200

1,400

1,600

1,800

2,000

2,200


mm

cf/

d

mb

bl/

d

Oil Gas1,911

2,941

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

[TBU]

15

April 6, 2020

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Disclaimer: The foregoing links are for convenience only and relate to materials that were not prepared or reviewed by BMO Capital Markets. BMO Capital Markets takes

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https://www.ipaa.org/events/ogis-new-york-2020/

https://10times.com/offshore-communications-exhibition















https://www.hartenergyconferences.com/ad-strategies-and-opportunities





https://www.hartenergyconferences.com/dug-east





https://www.ipaa.org/events/texas-holdem-tournament-2020/






https://www.ipaa.org/events/leaders-industry-luncheon-december-2020/



https://houstonproducersforum.org/luncheons.aspx



https://www.ipaa.org/events/



https://adamhouston.org/events/





https://www.api.org/products-and-services/events/calendar?page=2&pageSize=10




































16

April 6, 2020

SCOOP/STACK/Merge

DJ-Niobrara

Eagle Ford

Haynesville

Granite Wash

GOM

Permian

Marcellus

Utica

Williston

Gulf Coast Onshore

Piceance

Powder River Green River

Legend

Current

Change

This material is prepared by the BMO Capital Markets’ Investment and Corporate Banking Department, for distribution to BMO Capital Markets’ clientele. It is not a product of

BMO Capital Markets’ Research Department. The views of the Investment and Corporate Banking Department may differ from those of the Research Department. No part of this

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by any means by any third parties, except with the prior written permission of BMO Capital Markets.

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Bank of Montreal or its subsidiaries (“BMO Financial Group”) has lending arrangements with, or provide other remunerated services to, many issuers covered by BMO Capital Markets.

The opinions, estimates and projections contained in this report are those of BMO Capital Markets as of the date of this report and are subject to change without notice. BMO Capital

Markets endeavors to ensure that the contents have been compiled or derived from sources that we believe are reliable and contain information and opinions that are accurate and

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affiliates that is not reflected in this report. The information in this report is not intended to be used as the primary basis of investment decisions, and because of individual client

objectives, should not be construed as advice designed to meet the particular investment needs of any investor. This material is for information purposes only and is not an offer to sell or

the solicitation of an offer to buy any security. BMO Capital Markets or its affiliates will buy from or sell to customers the securities of issuers mentioned in this report on a principal basis.

BMO Capital Markets or its affiliates, officers, directors or employees have a long or short position in many of the securities discussed herein, related securities or in options, futures or

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sell securities of issuers discussed herein. All values in this document are in US$ unless otherwise specified.

Source of rig count stats: Baker Hughes

Rig Count Summary MAPS IN

MASTER VIEW

Contacts

Disclaimer

Jason Martinez

MD & Head of U.S. A&D

713-546-9771

[email protected]

Howard Barnwell

MD & Transactions Mgr.

713-546-9767

[email protected]

Rob Priske

MD & Transactions Mgr.

713-546-9727

[email protected]

Dan Schockling

MD & Head of Commercial

713-518-1223

[email protected]

Michael Hackett

Vice President

Marian Yu

Associate

Aaron Moeller

Associate

BMO uses updated basin outlines, and the resulting rig counts, to more accurately represent current basin knowledge. The data below reflect these changes

and is different than those shown by Baker Hughes. The totals are the same.

351

(31)

43

(6)

9

--

39

--18

(1)

18

--

6

--21

(9)

39

(1)

62

(6)

10

(1)

2

--

12

(4)8

(1)

Michelle Tankimovich

Analyst

This

Week Change

Last

Week

Last

Year

Total Rigs 664 (64) 728 1,025

Oil 562 (62) 624 831

Gas 100 (2) 102 194

Miscellaneous 2 -- 2 --

Directional 41 (6) 47 70

Horizontal 593 (60) 653 901

Vertical 30 2 28 54

Basin

Permian 351 (31) 382 462

SCOOP/STACK/Merge 21 (9) 30 87

Granite Wash 6 -- 6 13

Eagle Ford 62 (6) 68 94

Haynesville 39 (1) 40 68

Marcellus 39 -- 39 69

Utica 9 -- 9 15

Williston 43 (6) 49 61

DJ-Niobrara 18 (1) 19 31

Green River 8 (1) 9 18

Powder River 12 (4) 16 23

Piceance 2 -- 2 4

Gulf Coast Onshore 10 (1) 11 17

GOM 18 -- 18 22

Alaska 8 (1) 9 8

Other 18 (3) 21 33

Mid-Con 6 (1) 7 17

Rockies -- -- -- 2

Western 11 (2) 13 13

Eastern 1 -- 1 1

Prompt Oil Price ($/bbl) $25.32 $2.72 12.0% Let’s follow these … · 2020-04-06 · Oil Prices...

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Transcript of Prompt Oil Price ($/bbl) $25.32 $2.72 12.0% Let’s follow these … · 2020-04-06 · Oil Prices...