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by Stockwatch Business Reporter
West Texas Intermediate crude for December delivery added 41 cents to $42.15 on the New York Merc, while Brent for January added 76 cents to $44.96 (all figures in this para U.S.). Western Canadian Select traded at a discount of $11.70 to WTI, down from a discount of $11.55. Natural gas for December added six cents to $2.65. The TSX energy index added a fraction to close at 82.08.
U.S. shale producer Ovintiv Inc. (OVV) lost 32 cents to $15.92 on 1.09 million shares. As discussed in yesterday's Energy Summary, the company has been making headlines as a result of Kimmeridge Energy Management, a U.S. activist investor that has acquired about five million shares of Ovintiv and is threatening a proxy fight. This has overshadowed another reason that Ovintiv has been in the news recently: a potential asset sale. Various media outlets, beginning with the Daily Oil Bulletin late last week, have started reporting that Ovintiv is trying to sell its Eagle Ford assets in Texas. The Eagle Ford contributed 24,300 of the 510,000 barrels a day that Ovintiv produced in the third quarter of 2020. This is down from about 50,000 barrels a day from the Eagle Ford in the same period two years earlier, showing how little of the budget has gone to the play lately. When Ovintiv released its third quarter financials last month, it said one of its near-term priorities would be debt reduction -- specifically, reducing debt by $1-billion (U.S.) from mid-2020 to the end of 2021. (Net debt as of June 30 was $7.3-billion (U.S.).) Exiting the Eagle Ford could go a long way to achieving this goal while shedding what are clearly non-core assets.
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