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The Daley Note 10/21/2020

The Daley Note 10/21/2020

  • Permian Merger Mania – Pioneer Resources’ (PXD) all-stock acquisition of Parsley Energy (PE) for $4.5 billion continues a trend of upstream consolidation in the Permian Basin as producers seek scale to compete at lower oil prices. We examine the midstream implications. COP, CXO, ET, PE, PXD, CXO, TRGP.
  • A Waiting Game on Colorado Setbacks – In early November the Colorado Oil and Gas Conservation Commission (COGCC) will promulgate new drilling regulations, including potential 2,000’ setback requirements for permitting new wells, that could constrain production in the DJ Basin, a concern for DCP Midstream (DPM). DCP, OXY, PDCE, WES, XOG.
  • Rig Activity Grows by 3.4 to 332 Rigs. On the midstream side, DCP Midstream is up 5.7 rigs on its G&P systems across the Permian and Eagle Ford basins. Energy Transfer LP is up 4 rigs on its G&P systems in the ArkLaTex, Eagle Ford, and Permian basins. We examine these in our Midstream Activity Tracker (MAT).
  • Key North American energy indicators and equity prices.
  • Key North American natural gas, crude oil, and natural gas liquids prices.