The Oklahoman (Sunday) - - BUSINESS - Don Me­coy dme­coy@


Last week was a good one for oil pro­duc­ers as crude prices hit their high­est lev­els since 2014. Some of our big lo­cal en­ergy firms got some love from Wall Street.

Ch­e­sa­peake En­ergy shares rose more than 10 per­cent. Devon En­ergy stock jumped 8 per­cent. And Con­ti­nen­tal Re­sources stock gained more than 5 per­cent.

But our big­gest gainer was Ok­la­homa City-based Gulf­port En­ergy, which fo­cuses on nat­u­ral gas pro­duc­tion. And, boy, did Gulf­port pro­duce some gas last quar­ter.

The com­pany also oblit­er­ated an­a­lysts' ex­pec­ta­tions for the quar­ter. An­a­lysts guessed ad­justed prof­its would be about 42 cents a share. It was 56 cents a share.

The com­pany bought back $100 mil­lion of its own stock dur­ing the quar­ter, re­duc­ing out­stand­ing shares by about 5 per­cent. And Gulf­port is au­tho­rized to re­pur­chase an­other $100 mil­lion.

All that pro­duced a gain of more than 15 per­cent last week for GPOR shares, which closed Fri­day at $10.31.


Jar­gon alert! The fol­low­ing sen­tence was ut­tered Thurs­day by the CEO of BlueKnight En­ergy Part­ners, last week's bea­gle stock: "The tran­si­tion of the crude for­ward price curve from a con­tango struc­ture into back­war­da­tion has im­pacted de­mand for stor­age."

When I read this to our en­ergy edi­tor, Adam Wil­moth, he replied: "Makes per­fect sense."

He trans­lated it thusly: The re­cent spike in crude oil prices means oil is worth more to­day than the fu­tures con­tracts for oil, say, two years out. When oil prices were much lower, the fu­tures con­tracts were worth more than the cur­rent well­head price, which en­cour­aged stor­age of vast quan­ti­ties of crude.

In the cur­rent sit­u­a­tion, ev­ery­one wants to get their oil to mar­ket, which is why BlueKnight has seen stor­age vol­ume at its Cush­ing fa­cil­i­ties fall 46 per­cent, CEO Mark A. Hur­ley told an­a­lysts.

That's one rea­son why BKEP shares slipped more than 15 per­cent last week, setting a new 52-week low on Fri­day.

The good news? Blueknight is join­ing forces with an­other firm to build a pipe­line from the oil-rich STACK play.

Ea­gle & Bea­gle is a weekly look at the state's high-per­form­ing (ea­gle) and low-per­form­ing (bea­gle) stocks by Busi­ness Edi­tor Don Me­coy.

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