The 3 Most Important Numbers in Energy
By Editorial Dept - Mar 07, 2014, 1:56 PM CST
The Insider’s weekly run-down of critical figures and happenings from around the energy world.
$1.34. Value of proved reserves created in 2013 for each $1 spent by Gulf of Mexico oil developer EPL Oil & Gas (NYSE: EPL).
The company’s new reserves figures show a very satisfying 34% return on investment from its capital spending last year on drilling, acquisitions and development. A much higher figure than those being put in by other firms in the U.S. petroleum space.
Such returns on investment are beating even hot onshore shale plays. In 2013, major shale player Chesapeake Energy (NYSE: CHK) generated $1.20 in proved reserves for every dollar spent.
The secret to EPL’s big performance? Operating in the low-cost Gulf of Mexico Shelf, where reduced expenses are helping E&Ps realize industry-leading success—even as investors look elsewhere.
Expect that focus to change as the big returns from GOM drilling continue.
15.5%. Further to the news above—the percentage increase in operating costs for oil and gas developers in the U.K. offshore last year, according to recent reports from industry group Oil & Gas U.K.
This is a big jump in expenses for offshore drillers. With total opex in 2013 coming in at a total $14.8 billion.
Oil & Gas U.K. expects the trend to continue in 2014—projecting a further 8% rise in costs for the coming year.
That’s a significant bite…
The Insider’s weekly run-down of critical figures and happenings from around the energy world.
$1.34. Value of proved reserves created in 2013 for each $1 spent by Gulf of Mexico oil developer EPL Oil & Gas (NYSE: EPL).
The company’s new reserves figures show a very satisfying 34% return on investment from its capital spending last year on drilling, acquisitions and development. A much higher figure than those being put in by other firms in the U.S. petroleum space.
Such returns on investment are beating even hot onshore shale plays. In 2013, major shale player Chesapeake Energy (NYSE: CHK) generated $1.20 in proved reserves for every dollar spent.
The secret to EPL’s big performance? Operating in the low-cost Gulf of Mexico Shelf, where reduced expenses are helping E&Ps realize industry-leading success—even as investors look elsewhere.
Expect that focus to change as the big returns from GOM drilling continue.
15.5%. Further to the news above—the percentage increase in operating costs for oil and gas developers in the U.K. offshore last year, according to recent reports from industry group Oil & Gas U.K.
This is a big jump in expenses for offshore drillers. With total opex in 2013 coming in at a total $14.8 billion.
Oil & Gas U.K. expects the trend to continue in 2014—projecting a further 8% rise in costs for the coming year.
That’s a significant bite out of profits for E&Ps here. And a story we’re increasingly seeing in oil and gas basins globally.
Such rising costs appear to be putting the brake on new spending in the U.K. sector. With new outlays for 2014 forecast to fall to $21.7 billion—down from $24 billion last year.
$530 million. Debt owed by major uranium enrichment firm USEC Inc. (NYSE: USU)—forcing the company to file for Chapter 11 bankruptcy this week.
The company—which operates the only U.S.-owned uranium enrichment facility domestically—had been eying October 2014 maturities of a series of convertible notes. The bankruptcy reorganization plan will allow the company to issue new shares in order to reduce outstanding debt to $240 million.
The deal is supported by USEC’s major shareholders including Japanese conglomerate Toshiba Corp. It will reportedly allow the company to continue its uranium enrichment operations while restructuring takes place.
USEC is a victim of the global downturn in the nuclear sector following the Fukushima nuclear incident in 2011. The company’s revenues have suffered from a global decrease in demand for nuclear fuel—as well as knock-on delays in implementing new uranium upgrading technology in the U.S.
