![]() ![]() If you look at the current Street estimate for FY12 EBITDA of $782mm, it's clear the Street is honing in on a per BOE figure for EBITDA of $45 (using the mid point of volume guidance of 48,000 BOEpd that actually yields EBITDA of $788 mm but I'm splitting hairs at this point). They continue to underspend cash flow and pay down debt. As to the Ultra Deep play they essentially only reiterated what MMR said earlier in the week, most importantly to most observers, that the Davy Jones 1 flow test is a calendar 1Q12 event. Examples where EXXI has taken cash starved assets and applied minimal capital to yield better than expected (as per thinking at the time of acquisition) results abound. It is the stuff XOM and others didn't care about enough to go after because it simply wasn't going to be meaningful enough to them. The growth we are now seeing is the result of development drilling and recompletions and not what you'd call out and out exploration. Operationally they continue to deliver on their conventional depth Shelf exploitation program. This all culminated in the highest EBITDA and EBITDA per BOE we have seen to date in the name. LOE looked particularly favorable in light of the rise in oilier production, coming in at $19.74 per BOE. ![]() The BOE price was a function of the oilier mix and the improved premium we have been seeing to WTI for HLS and LLS.Ĭost control was good with cash costs coming down to $25.67 per BOE, from $26.29 last quarter. Revenue was a very strong at $83.42 / BOE, also a multi year high even though WTI prices were not as high as they had been earlier in the year and gas prices were lower. The production profile became oilier as well with oil comprising 72% of volumes, after having held in the upper 60%'s over the last two years. The ramp is starting earlier than expected but should only be the beginning as management has guided this backend loaded year to roughly 58,000 BOEpd. Production was up more than anticipated in the quarter rising to 42,700 MBOEpd, up 5% sequentially, on the back of a number of successful lower risk development wells and a better than expected recompletion program. ![]()
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