Pioneer Natural Divests Alaska Unit - Analyst Blog
April 16 2014 - 4:00PM
Zacks
Oil and gas company Pioneer
Natural Resources Company (PXD) announced the divestment
of its Alaska subsidiary to Caelus Energy Alaska LLC for cash
proceeds of $300 million. The company expects to recognize a
non-cash loss of about $30 million associated with the sale when it
reports earnings for the first quarter of 2014.
Pioneer Natural Resources is a large independent oil and gas
exploration and production company, headquartered in Dallas, TX
with operations in the U.S. The company’s oil-weighted reserves
base and large drilling inventory (over 20,000 liquids rich
drilling locations in low-risk resource plays) with significant
resource potential are catalysts to unlock value for shareholders.
The company offers a deep inventory of high-return,
liquids-leveraged drilling opportunities.
For 2014, Pioneer plans to spend $3.3 billion in total. Of this,
the company has planned drilling capex of $3 billion and capital
for vertical integration of $0.3 billion. An amount of $2.2 million
has been allocated for the northern Spraberry/Wolfcamp area; $205
million has been set aside for the southern Wolfcamp joint venture
area, $545 million for Eagle Ford shale and $100 million for other
assets.
However, the company’s long-term production and reserve growth
depends to a certain extent on its acquire-and-exploit mode.
Pioneer might therefore find it difficult to complete accretive
transactions in the future, which could negatively impact its
growth rate.
Pioneer Natural Resources currently retains a Zacks Rank #3 (Hold),
implying that it is expected to perform in line with the broader
U.S. equity market over the next one to three months.
Meanwhile, one can consider better-ranked players in the energy
sector like Flotek Industries Inc. (FTK),
Helmerich & Payne Inc. (HP) and
Exterran Holdings, Inc. (EXH). All these stocks
sport a Zacks Rank #1 (Strong Buy).
EXTERRAN HLDGS (EXH): Free Stock Analysis Report
FLOTEK INDU INC (FTK): Free Stock Analysis Report
HELMERICH&PAYNE (HP): Free Stock Analysis Report
PIONEER NAT RES (PXD): Free Stock Analysis Report
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