Seeking Alpha: Statoil Results Show The Price Of Value

As a Statoil (NYSE:STO) shareholder, I've been pleased to see the market finally waking up to the underlying value at this Norwegian state-owned oil and gas producer. Not only does Statoil have a very good recent record of adding barrels through the drillbit, but it has also established strong operating know-how in unconventional, harsh, and difficult operating environments. Management has also been pledging a greater focus on returns and economic value added and that offers exciting potential in tandem with an above-average production growth profile post-2018.

Read more here:
Statoil Results Show The Price Of Value

Seeking Alpha: Controversial Gazprom Still Cheap, Still Risky

Recommending Russia's giant natural gas company Gazprom (OTCPK:OGZPY) to readers last year was a controversial pick and one that has not worked out as well as I might have hoped. I went into it well aware of the attendant risks of owning a company that is virtually an arm of the Russian government and that has a reputation for not working and playing well with others. While the roughly 3% gain since then isn't horrible, it has lagged other turnaround energy stories like Statoil (STO) as well as its home index (though only by a couple of percentage points).

Given the Russian government's combative attitude toward Europe and the West, I'm less bullish that Gazprom's valuation discount is going to improve in the near future. I continue to believe that only modest growth can support a fair value well above today's price and that Gazprom has significant restructuring opportunities, but it takes a strong contrarian streak to invest here. I continue to see opportunities here for aggressive investors with a long-term orientation, but I can't fault investors who will argue that there are easier ways to generate alpha in the market over the next 12-24 months.

Follow this link to the full article:
Controversial Gazprom Still Cheap, Still Risky

Seeking Alpha: Eni's Solid Upstream Overshadowed By Multiple Downstream Issues

To paraphrase Mark Twain, Italy's Eni (E) is a good upstream company spoiled. In this case, the spoilage comes from money-losing capital sinkholes in the downstream operations like its Gas & Power and Refining & Marketing operations. To be sure, Eni's upstream operations are not perfect or risk-free, as the company has a recent history of disappointing on production growth targets and its production is heavily weighted toward some pretty dicey countries. It's hard for me to argue strongly for buying Eni over other majors like Statoil (STO) (which I own), but I will say that sentiment is pretty bearish on Eni relative to its solid production pipeline and further progress in reforming its downstream operations and/or selling off subsidiary stakes could unlock some worthwhile upside.

Please continue here:
Eni's Solid Upstream Overshadowed By Multiple Downstream Issues

The Motley Fool: Statoil ASA's Focus on Returns and Higher-Grade Assets Should Pay Off

This year has already started off on a much better foot for Statoil (NYSE: STO  ) than its recent stock market experience. Maligned for its high finding and development costs, its dependence on high oil prices, and its weaker near-term production growth, Statoil investors had to endure a frustrating stretch where the short term-obsessed market wasn't willing to give the company its due.

Now, though, the market appears to be taking a more optimistic view. The turbulence in Ukraine has drawn attention back to Statoil's position as the largest supplier of gas to Europe outside of Russia. At the same time, management has openly turned to a more returns-oriented approach and has spent the last year upgrading its portfolio and making some major oil and gas discoveries. Valuation for oil and gas companies may be frustratingly imprecise, but Statoil seems to be offering a good mix of improving returns, capital appreciation, and a solid yield.

Read the full article here:
Statoil ASA's Focus on Returns and Higher-Grade Assets Should Pay Off

Seeking Alpha: Gazprom's Discount Seems Extreme

I can understand why investors may not be elbowing each other aside to buy shares of Gazprom (OGZPY.PK). Gazprom is controlled by the Russian government, and while it is a major source of Europe's natural gas supplies, Western oil and gas companies are hard at work boosting production in areas like the North Sea to reduce that dependence. It also doesn't help matters that Gazprom reports financial results on "Russian time", with March quarterly IFRS results only just reported in the first week of September.

And yet, we're talking about a company that produces 17% of the world's natural gas and holds a similar percentage of the world's natural gas reserves. We're talking about a company that literally monopolizes Russia's gas exports and represents a major source of energy to Europe. We're also talking about a company that will likely begin exporting natural gas to China in the future, and could ultimately supply even more of the world's gas needs.

Trading at approximately 2.6x 2014 EBTIDA estimates, Gazprom's valuation seems to already incorporate some rather sizable doubts about the company's ability to improve domestic pricing, control production costs, and support rising dividend payouts. While Gazprom shares are not appropriately for investors with low appetite for risk, the shares do seem undervalued even by the stressed standards of Russian energy companies and offer more than 40% upside from today's levels.

Read the full article here:
Gazprom's Discount Seems Extreme

Seeking Alpha: OMV's Transformation Should Unlock Meaningful Value

One of the most rewarding things about writing about stocks is when you write a piece, make certain specific predictions, and then see those come to fruition. In contrast, one of the most frustrating things is to have a piece all lined up and ready to go and then see one of your big predictions come true before your piece gets published. That has happened to me now on OMV (OMVKY.PK), as the company announced Monday that the company had reached a potentially transformative $2.7 billion deal with Statoil (STO).

The good news is that my basic thesis on OMV still holds - OMV looks like a significantly undervalued European energy major with catalysts to drive better performance in the coming years. Not only does the acquisition of North Sea assets from Statoil significantly improve the odds that the company will meet its long-term production growth goals (something the Street was incredibly skeptical about), but OMV remains a strong free cash flow-generating major with a low breakeven price and capacity for additional farm-ins as circumstances allow. All told, I believe these shares should trade more than 30% higher than they do today.

Please read more here:
OMV's Transformation Should Unlock Meaningful Value

Seeking Alpha: Tullow Hasn't Forgotten How To Find Oil, And The Shares Look Too Cheap

Exploration-focused oil and gas companies can give investors a wild ride. That has definitely been the case at Britain's Tullow Oil (TUWOY.PK), as uncommon drilling success built the company into Europe's largest independent, only to see the shares fall more than 20% over the past year on multiple poor results of its exploration program.

I believe that while finding oil is a "win some, lose some" sort of game, Tullow has proven over the years that it will win more than its share. With a strong core expertise in petroleum geology and demonstrated discipline in license acquisition, coupled with a rich portfolio of exploration assets, I believe that Tullow can regain some of its luster and that the shares are 30% to 40% too cheap even if future drilling success rates can't match the company's past levels.

Please continue reading here:
Tullow Hasn't Forgotten How To Find Oil, And The Shares Look Too Cheap

Investopedia: Statoil's Turnaround Proceeding Much Too Slowly

I bought Statoil (NYSE:STO) on the idea that this Norwegian energy giant was troubled, but that it would get its house back in order and deliver on its strong legacy of profitably developing energy reserves in challenging locations. So far, not so good. Statoil is one of the worst-performing energy majors over the past year, rising about 3% while Chevron (NYSE:CVX) has risen 29% and Exxon Mobil (NYSE:XOM), Total (NYSE:TOT), BP (NYSE:BP) are all up about 18%.

Statoil continues to struggle to keep a handle on production costs, and unplanned outages have wrecked havoc with a relatively fixed operating expense structure. Though I still believe that Statoil can do better, and is significantly undervalued on that basis, it's getting harder and harder to stay patient with the stock.

Please continue here:
http://www.investopedia.com/stock-analysis/060413/statoils-turnaround-proceeding-much-too-slowly-sto-bp-tot-xom.aspx

Investopedia: Total Looks Cheap, But There's A Reason

Some investors and commentators treat the international oil majors as an undifferentiated mass, suggesting that investors need only follow dividend yields and/or PE ratios to find the best bargains at a given point in time. Total (NYSE:TOT) offers a good example of why that's not a very good approach. While Total's aggressive exploration program could offer some upside to production and profits down the road, the company's leverage to high oil prices and lower margins/returns underline a riskier business model that ought to trade at some discount to peers.

Please follow this link for more:
http://www.investopedia.com/stock-analysis/042913/total-looks-cheap-theres-reason-tot-xom-cvx-apc-su-sto.aspx

Investopedia: Statoil - Should You Love What The Analysts Hate?

The great thing about investing is that there's no one right way to make money. Some investors do quite well surfing along with the crowd and have the dexterity to get in or out just as the mood starts to shift. Others succeed by boldly trusting their own analysis and going directly against prevailing sentiment. Investors considering Norwegian oil and gas company Statoil (NYSE:STO) need to be more of that latter mindset. While Statoil has changed for the better in some significant ways over a relatively short time period, the company is hardly a darling on the Street.

Continue reading here:
http://stocks.investopedia.com/stock-analysis/2012/Statoil---Should-You-Love-What-The-Analysts-Hate-STO-XOM-E-BP0815.aspx

Investopedia: Total Has More To Lose With Falling Oil Prices

Major oil and gas companies are clearly suffering as oil prices decline. While some investors look at this situation as a bargain-in-the-making on the basis of a never-ending demand for oil around the world, the truth is a little more nuanced. Oil demand does indeed look solid on an intermediate-term basis, but many majors are finding that they have to spend enormous amounts of money to harvest their reserves. Consequently, today's oil prices do start to change the expected path for project development and dividend payouts.

Total (NYSE:TOT) is one of those companies that looks vulnerable to the squeeze play. Not only does Total have a sizable downstream (refining) business that drags on results, but the upstream operations have some questions around them as well. With so much expected production tied to areas with political risks and/or advanced technological needs, Total has a has a problem with sub-$90 oil.

Click here for more:
http://stocks.investopedia.com/stock-analysis/2012/Total-Has-More-To-Lose-With-Falling-Oil-Prices-TOT-RDS-E-STO0629.aspx

Seeking Alpha:Given The Operational Risks, ConocoPhillips Is No Bargain

Some companies just seem to have a knack for making the wrong moves, and I fear that ConocoPhillips (COP) is one of those. While many of the company's decisions make sense on a passing glance (buying energy companies a while back, spinning off the refining business, etc.), they just seem to go sour in the hands of ConocoPhillips. Given the neither fish-nor-fowl nature of the post-split E&P business, I think there are better buys to be had in the oil patch today.

Please read more here:
Given The Operational Risks, ConocoPhillips Is No Bargain

Investopedia: Triangle Petroleum Almost A Ground-Level Bakken Play

If there are any investors fretting that they have missed the story in the Bakken, a name like Triangle Petroleum (AMEX:TPLM) may be an answer to those worries. While Triangle is still a very risky story, the company is only just starting to develop its acreage in the Bakken region. If Triangle follows the same path carved out by others like Whiting (NYSE:WLL), Continental (NYSE:CLR), Kodiak (NYSE:KOG) and Oasis (NYSE:OAS), investors may be able to look forward to considerable growth in reserves, production, and market valuation over the coming years.

Still (Mostly) A Land Story 
For all of the talk about the Bakken, it's still a new energy-producing region in North America and there is plenty of growth yet to come from the area. While activity in the Bakken is largely dominated by larger, well-established companies for whom the Bakken is just another operating region, Triangle is a different story altogether.

Click here for more:
http://stocks.investopedia.com/stock-analysis/2012/Triangle-Petroleum-Almost-A-Ground-Level-Bakken-Play-TPLM-WLL-CLR-KOG-MRO-STO-EOG0410.aspx

Investopedia: PetroChina As Much About Politics As Performance

There are plenty of energy companies around the world that are partially owned by national governments, but the influence that those governments have can vary considerably. Statoil (NYSE:STO) and Total (NYSE:TOT) encounter relatively little direct interference, while the involvement of Brazil's government in the operations of Petroleo Brasileiro (NYSE:PBR) is considerably greater.

Even further along the spectrum sits China's PetroChina (NYSE:PTR). Although PetroChina is one of the world's largest oil companies and generally well-regarded for its corporate governance, there are no illusions about the extent to which the Chinese government calls the shots. The question for investors, then, is whether that constant "management" (or interference, depending upon your perspective) strips away from the value of this company's stock.

Read the full article here:
http://stocks.investopedia.com/stock-analysis/2012/PetroChina-As-Much-About-Politics-As-Performance-PTR-PBR-STO-TOT0321.aspx

Investopedia: Statoil - Iffy Operations, But Serious Potential Value

There are not many freebies in oil and gas, so if an investor wants to own an E&P company trading at a low valuation, there is a price to be paid in quality. The question with Norway's Statoil (NYSE:STO) is just how much of a discount is really fair. Although Statoil does indeed have issues with its cost structure and reserve base, the company's above-average growth potential and capacity for additional deals argues that the discount today is too steep.

Familiar Problems Show up in Q4  
Statoil's fourth quarter results weren't too surprising to long-term followers of this story. Although production slightly beat expectations, it grew less than 1% overall, as declines in Norwegian production offset better than 25% growth from international projects.


Please read more here:
http://stocks.investopedia.com/stock-analysis/2012/Statoil--Iffy-Operations-But-Serious-Potential-Value-STO-XOM-TOT-CHK0229.aspx

Investopedia: Transocean Has Value, But Badly Needs Growth

Feel free to start performing, Transocean (NYSE: RIG); we're all waiting on you. While Transocean often finds itself in lists of top energy service ideas, the company's five straight missed quarters are making it harder and harder to stay optimistic on this leading offshore driller. Although the long-term fundamentals for offshore exploration are indeed strong and Transocean shares look like a value stock, investors will have to be patient here, as management must not only rebuild performance, but rebuild Wall Street's trust as well. (To know more about value investments, read: 5 Must-Have Metrics For Value Investor.)

A Miserable Third Quarter 

If there was good news in Transocean's third quarter report, it was pretty much limited to the absence of any kraken attacks on the company's equipment. Revenue fell 4% from the second quarter, and 3% from last year, on lower utilization rates caused by downtime issues. Although rates are not terrible, the company had the worst performance in its highest-margin segments.

Please continue via the link below:
http://stocks.investopedia.com/stock-analysis/2011/Transocean-Has-Value-But-Badly-Needs-Growth-RIG-CAM-NOV-GE-STO-PBR1107.aspx

Investopedia: Exxon Mobil - Biggest and Best, But Blah?

Investment advisers often recommend that investors seek out the best operators in an industry for their portfolio. When it comes to oil and gas, it is hard to do much better than Exxon Mobil (NYSE:XOM). While this company has gargantuan reserves, a well-earned reputation as a superior capital allocator, and ample cash to share with its investors, it sometimes seems as though Exxon is overlooked in favor of more exciting names. Though Exxon does not boast the highest potential returns in the energy space, investors looking for a lower-beta play may yet want to give it serious thought. 

Ho-Hum Third Quarter  
For better or worse, there were no major surprises in Exxon's third quarter results. Production slid 4% as the XTO acquisition rolls off and liquids production was incrementally weaker (down 7%). Realizations, the price Exxon gets for its oil and gas, were fairly strong - liquids prices rose from 35 to 45% by geography, while weak U.S. gas prices were offset by higher prices in Europe. All told, revenue rose about 31% from last year.

Please click the link for more:
http://stocks.investopedia.com/stock-analysis/2011/Exxon-Mobil---Biggest-And-Best-But-Blah-XOM-CRED-CHK-APA-BEXP-STO-SLB1031.aspx

Investopedia: Statoil Buys Into Bakken

By most standards, Norway's Statoil (NYSE:STO) is a quality name in the world of major energy companies. Unfortunately for its shareholders, the company's stock price has been bedeviled by worries regarding the company's production volumes, reserve growth and dependence on Norway's offshore energy fields. With Monday's announcement that the company is acquiring Bakken specialist Brigham Exploration (Nasdaq:BEXP), Statoil management is making a solid argument that the company is not sleeping on opportunities to leverage its balance sheet into solid reserve growth.


The Terms
Statoil and Brigham announced that the companies had reached an agreement whereby Statoil will acquire Brigham for $36.50 per share in cash, for a total enterprise deal value of $4.7 billion. That price translates into a roughly 20% premium to Friday's close.


Read the full piece at Investopedia:
http://stocks.investopedia.com/stock-analysis/2011/Statoil-Buys-Into-Bakken-STO-BEXP-BHP-CHK-WLL-CRED-CLR1018.aspx

Seeking Alpha: Waiting For Halliburton To Wash Out

Investors looking for an example of how short-term thinking dominates the equity markets these days do not have to go much past the energy sector. There are still plenty of arguments over what “Peak Oil” is supposed to mean, but hardly anybody thinks that long-term oil and natural gas prices are going to substantially lower than today. And yet, nervousness about the near-term economic outlook and short-term oil price declines as investors leery of even well-established service names like Halliburton (HAL).

Okay Results Fail To Impress
This is a market that wants dramatic outperformance and strong upward revisions from management, and Halliburton didn't deliver. Consequently, the fact that revenue was up about 10% sequentially and still a bit stronger that the average analyst guess just isn't going to cut it – particularly when management talked about an increasingly competitive international pricing environment and delays in key growth markets like Iraq and Angola.

Read more at this link:
Waiting For Halliburton To Wash Out

Investopedia: Libya Adds Some Good News To Energy Names

With word coming out this weekend that the rebel forces had begun to enter Libya's capital of Tripoli, it looks as though the Arab Spring may be winding down. Although investors should never fully discount the risk of further turbulence - citizens are getting restless in Egypt, Syria is still spasming with protests and crackdowns and further troubles could always emerge in nations like Iran or Iraq - it looks like many Western names may be soon getting back to the business of exploiting sizable untapped foreign reserves. (Dividend capture strategies provide an alternative investment approach to income seeking investors. See How To Use The Dividend Capture Strategy.)

Back to Business as Usual?  
With a few exceptions here and there, major international oil companies pulled their employees out of Libya when armed insurrection against Qaddafi's regime began earlier this year. Now that it appears that the rebels are closing in on victory, it may be time to reconsider some of the names that had sizable partnerships with the Libyan government in developing oil and gas reserves that had gone largely underutilized during Libya's long period of isolation.

To read more, click below:
http://stocks.investopedia.com/stock-analysis/2011/Libya-Adds-Some-Good-News-To-Energy-Names-E-TOT-COP-HES-STO0823.aspx