1. Art and Diseño

Scotia Howard Weil – Weekly Macro Update
Week Ending
January 30, 2015
Weekly Macro Update
Scotia Howard Weil is a division of Scotia Capital (USA) Inc., a member of the Scotiabank group, and represents Scotiabank’s energy equities business in the United States.
For all relevant disclosures and certifications see Appendix A Important Disclosures of this report.
February 2, 2015
Page 1 of 23
Scotia Howard Weil – Weekly Macro Update
Crude Oil Spot Prices
Crude Oil
Crude Oil Prices (WTI) - 1997 to Present
•
$160
$140
$120
Spot crude oil prices fell 2.13% for
the week. Prices averaged $45.72
per barrel compared with $46.71
the previous week. Oil prices
averaged $97.24 per barrel one year
ago.
$100
$80
$60
$40
Avg. '12
$102.99
1Q
$93.30
2Q
$92.16
3Q
$88.17
4Q
Source: Bloomberg
February 2, 2015
Avg. '13
$ 94.30
$ 94.14
$ 105.82
$ 97.56
Avg. '14
$ 98.65
$ 103.06
$ 97.60
$ 73.21
Avg. '15 % Change
$ 46.53
-53%
Jul-14
Jul-13
Jul-12
Jul-11
Jul-10
Jul-09
Jul-08
Jul-07
Jul-06
Jul-05
Jul-04
Jul-03
Jul-02
Jul-01
Jul-00
Jul-99
Jul-98
$0
Jul-97
$20
Week Ending Avg. Price % Change
1/30/2015
$45.72
1/23/2015
$46.71
-2.13%
1/31/2014
$97.24
-52.98%
Page 2 of 23
Scotia Howard Weil – Weekly Macro Update
Crude Oil Futures Prices
NYMEX Crude Oil Futures Prices ($/Bbl)
Date
12/6/2013
1/3/2014
2/7/2014
3/7/2014
4/4/2014
5/2/2014
6/6/2014
7/4/2014
8/1/2014
9/5/2014
10/3/2014
11/7/2014
12/5/2014
1/2/2015
1/9/2015
1/16/2015
1/23/2015
1/30/2015
Feb-15
Mar-15
$91.45
$93.32
$93.32
$94.99
$96.45
$99.81
$95.13
$92.79
$87.26
$92.55
$65.84
$56.52
$56.52
$56.52
$56.52
$56.52
$92.43
$92.57
$92.67
$95.66
$99.14
$94.67
$92.22
$86.78
$78.54
$65.96
$52.69
$48.36
$48.69
$46.39
$46.39
Apr-15
$91.89
$92.01
$94.90
$98.45
$94.21
$92.16
$86.34
$78.54
$66.08
$53.11
$48.99
$49.13
$45.59
$47.48
May-15
$91.41
$94.23
$97.84
$93.84
$91.96
$86.02
$78.59
$66.28
$53.69
$49.73
$49.84
$46.32
$48.19
Jun-15
$93.64
$97.31
$93.48
$91.80
$85.76
$78.68
$66.50
$54.42
$50.54
$50.62
$47.31
$49.24
Jul-15
$96.70
$93.19
$91.71
$85.45
$78.78
$66.68
$55.15
$51.33
$51.37
$48.34
$50.36
Aug-15
$92.93
$91.47
$85.22
$78.82
$66.82
$55.80
$52.08
$52.09
$49.38
$51.53
Sep-15
$91.25
$85.08
$78.89
$67.00
$56.42
$52.77
$52.76
$50.35
$52.59
Oct-15
Nov-15
$85.01
$79.00
$67.23
$57.07
$53.45
$53.41
$51.23
$53.58
Dec-15
$79.20
$67.44
$57.71
$54.09
$53.99
$51.98
$54.42
12-month
Strip
$92.27
$89.45
$92.23
$93.84
$93.89
$94.12
$95.77
$98.87
$94.35
$92.07
$86.74
$80.25
$67.45
$55.54
$52.05
$52.09
$49.65
$51.41
Jan-16
$67.98
$58.38
$54.74
$54.56
$52.69
$55.18
$59.05
$55.38
$55.12
$53.38
$55.91
Week Over Week
Week Over Week
$ Change
% Change
-$0.36
-0.39%
-$3.06
-3.31%
$3.07
3.44%
$0.11
0.11%
-$0.49
-0.52%
-$0.71
-0.75%
$0.19
0.20%
-$0.83
-0.84%
-$2.98
-3.06%
-$1.68
-1.79%
-$4.14
-4.56%
-$1.12
-1.37%
-$0.31
-0.45%
-$1.63
-2.85%
-$3.49
-6.28%
$0.03
0.07%
-$2.44
-4.69%
$1.76
3.55%
Source: Bloomberg
12 Month Crude Strip
NYMEX Futures
•
The 12-month NYMEX strip rose by 3.55%
versus the prior week, to close at $51.41.
$150
$130
$110
$90
$70
$50
Oct-14
Jun-14
Oct-13
Feb-14
Jun-13
Oct-12
Feb-13
Jun-12
Oct-11
Feb-12
Jun-11
Oct-10
Feb-11
Jun-10
Oct-09
Feb-10
Jun-09
Oct-08
Feb-09
Jun-08
Oct-07
Feb-08
Jun-07
Feb-07
$30
*Source: Bloom berg
February 2, 2015
Page 3 of 23
Scotia Howard Weil – Weekly Macro Update
Natural Gas
Natural Gas Spot Prices (2011 - Present)
$9
$8
$7
$6
Natural Gas Prices
•
Spot natural gas prices were down
3.5% versus the prior week. Prices
averaged $2.866 per MMBtu versus
$2.971 per MMBtu last week. Prices
one year ago averaged $5.283 per
MMBtu.
$5
$4
$3
$2
$1
$0
2011
2012
2013
2014
*Source: Bloomberg
1Q
2Q
3Q
4Q
Avg. '11
$4.18
$4.36
$4.12
$3.33
February 2, 2015
Avg. '12
$2.43
$2.29
$2.88
$3.40
Avg. '13
$3.47
$4.04
$3.55
$3.84
Avg. '14
$5.16
$4.59
$3.94
$3.75
Avg. '15
$3.03
% Change
-2%
Week Ending Avg. Price % Change
1/30/2015
$2.866
1/23/2015
$2.971
-3.5%
1/31/2014
$5.283
-45.8%
Page 4 of 23
Scotia Howard Weil – Weekly Macro Update
Natural Gas
NYMEX Natural Gas Futures Prices ($/Mcf)
Date
Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16
2/7/2014
$4.05
3/7/2014
$4.77
$4.64
4/4/2014
$5.18
$4.60
$4.12
5/2/2014
$4.41
$4.86
$4.75
$4.18
6/6/2014
$4.79
$4.69
$4.19
$4.16
$4.17
7/4/2014
$4.52
$4.43
$4.07
$4.05
$4.07
$4.09
8/1/2014
$4.04
$4.03
$3.97
$3.74
$3.73
$3.76
$3.79
9/5/2014
$4.02
$3.96
$3.75
$3.74
$3.76
$3.79
$3.80
$3.79
10/3/2014
$4.17
$4.09
$3.81
$3.78
$3.81
$3.84
$3.85
$3.83
$3.87
11/7/2014
$4.51
$4.46
$4.35
$3.84
$3.78
$3.79
$3.81
$3.83
$3.82
$3.85
12/5/2014
$4.28
$3.80
$3.82
$3.77
$3.53
$3.52
$3.55
$3.58
$3.58
$3.68
$3.86
1/2/2015
$3.19
$3.00
$3.00
$2.95
$2.97
$3.02
$3.07
$3.09
$3.07
$3.09
$3.21
$3.41
1/9/2015
$3.19
$2.95
$2.95
$2.93
$2.95
$3.00
$3.05
$3.06
$3.04
$3.07
$3.16
$3.34
1/16/2015
$3.19
$3.13
$3.09
$3.02
$3.02
$3.06
$3.10
$3.11
$3.09
$3.11
$3.21
$3.40
1/23/2015
$3.19
$2.99
$2.96
$2.92
$2.95
$2.99
$3.04
$3.05
$3.04
$3.07
$3.17
$3.34
1/30/2015
$3.19
$2.87
$2.68
$2.68
$2.71
$2.75
$2.80
$2.81
$2.80
$2.84
$2.95
$3.14
Source: Bloomberg
12-month
Strip
$4.525
$4.635
$4.586
$4.634
$4.538
$4.300
$3.87
$3.84
$3.94
$4.02
$3.72
$3.06
$3.03
$3.10
$3.03
$2.82
Week Over Week
$ Change
Week Over Week
% Change
$0.07
1.6%
$0.02
0.5%
-$0.08
-1.7%
-$0.10
-2.1%
$0.10
2.2%
-$0.02
-0.4%
$0.02
0.5%
-$0.22
-5.5%
-$0.01
-0.2%
$0.23
6.0%
-$0.09
-2.5%
-$0.06
-1.8%
-$0.03
-0.9%
$0.07
2.3%
-$0.07
-$0.21
-2.3%
-6.8%
NYMEX Gas Strip
•
The 12-month NYMEX gas strip fell by $0.21 Mcf
(6.8%) to close the week at $2.82 per Mcf.
12 Month Gas Strip
$14.00
$12.00
$10.00
$8.00
$6.00
$4.00
Jan-15
Aug-14
Oct-13
Mar-14
May-13
Jul-12
Dec-12
Sep-11
Feb-12
Apr-11
Nov-10
Jan-10
Jun-10
Aug-09
Oct-08
Mar-09
May-08
Jul-07
Dec-07
Feb-07
$2.00
*Source: Bloom berg
February 2, 2015
Page 5 of 23
Scotia Howard Weil – Weekly Macro Update
Natural Gas Storage
Weekly Natural Gas Storage Inventory (Bcf)
Region
East
West
Producing
Total Working Gas in Storage
Inventory
1,281
375
887
2,543
Week Ending 1/23/2015
5-Year
Average
1,321
371
930
2,622
% Full
58%
67%
68%
63%
De lta from % Delta from
5-Year Avg.
5-Year Avg.
(40)
-3.0%
4
1.1%
(43)
-4.6%
(79)
-3.0%
U.S. Natural Gas Storage
4.5
7-yr High
Inve ntory Le vel (Tcf)
4.0
3.5
3.0
2.5
2.0
5-yr avg
1.5
1.0
2015 Le vel
7-yr Low
0.5
Jan.
Feb.
Mar.
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Source: EIA/DOE
Natural Gas Storage
•
•
•
The change in natural gas storage inventory announced January
29th for the period ending January 23rd , 2015, was a draw of 94
Bcf. Consensus was for a draw of 111 Bcf.
Storage levels are now 3.0% below the 5-yr. average.
Storage Estimate: Draw of 130-140 Bcf. The 5-year average draw
is 174 Bcf.
February 2, 2015
Estimated U.S. Working Gas in Storage (Bcf)
Week
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
2010
2,852
2,607
2,521
2,406
2,215
2,025
1,853
1,737
1,626
1,615
1,626
1,638
1,669
1,756
1,829
1,912
1,995
2,089
2,165
2,269
2,357
2,456
2,543
2,624
2,684
2,762
2,840
2,891
2,919
2,948
2,985
3,012
3,052
3,106
3,164
3,267
3,340
3,414
3,499
3,590
3,683
3,754
3,821
3,840
3,835
3,828
3,805
3,716
3,552
3,368
3,232
3,097
2011 2012 2013 2014 2015
2,959 3,377 3,316 2,817 3,089
2,716 3,290 3,168 2,530 2,853
2,542 3,098 2,996 2,423 2,637
2,353 2,966 2,802 2,185 2,543
2,144 2,888 2,684 1,923
1,911 2,716 2,527 1,693
1,830 2,595 2,400 1,443
1,745 2,513 2,229 1,348
1,674 2,433 2,083 1,196
1,618 2,369 1,938 1,001
1,612 2,380 1,876
953
1,624 2,437 1,781
896
1,579 2,479 1,687
822
1,607 2,487 1,673
826
1,654 2,501 1,704
850
1,685 2,548 1,734
899
1,757 2,576 1,777
981
1,827 2,606 1,865 1,055
1,919 2,667 1,964 1,160
2,024 2,744 2,053 1,266
2,107 2,815 2,141 1,380
2,187 2,877 2,252 1,499
2,256 2,944 2,347 1,606
2,354 3,006 2,438 1,719
2,432 3,063 2,533 1,829
2,527 3,102 2,605 1,929
2,611 3,135 2,687 2,022
2,671 3,163 2,745 2,129
2,714 3,189 2,786 2,219
2,758 3,217 2,845 2,307
2,783 3,241 2,941 2,389
2,833 3,261 3,006 2,467
2,906 3,308 3,063 2,555
2,961 3,374 3,130 2,630
3,025 3,402 3,188 2,709
3,112 3,429 3,253 2,801
3,201 3,496 3,299 2,891
3,312 3,576 3,386 2,988
3,409 3,653 3,487 3,100
3,521 3,725 3,577 3,205
3,624 3,776 3,654 3,299
3,716 3,843 3,741 3,393
3,794 3,908 3,779 3,480
3,831 3,929 3,814 3,571
3,843 3,911 3,834 3,611
3,852 3,873 3,789 3,594
3,851 3,877 3,776 3,432
3,831 3,804 3,614 3,410
3,729 3,806 3,533 3,359
3,629 3,724 3,248 3,295
3,548 3,652 3,071 3,246
3,472 3,517 2,974 3,220
5-yr
Avg.
3,048
2,800
2,638
2,456
2,279
2,113
1,968
1,857
1,755
1,695
1,686
1,690
1,703
1,729
1,755
1,803
1,877
1,952
2,038
2,135
2,228
2,322
2,407
2,487
2,563
2,638
2,718
2,780
2,834
2,886
2,927
2,963
3,018
3,082
3,139
3,207
3,278
3,353
3,432
3,514
3,578
3,644
3,702
3,728
3,738
3,736
3,720
3,654
3,540
3,410
3,289
3,167
2010
73.1%
66.8%
64.6%
61.7%
56.8%
51.9%
47.5%
44.5%
41.7%
41.4%
41.7%
42.0%
42.8%
45.0%
46.9%
49.0%
51.2%
53.6%
55.5%
58.2%
60.4%
63.0%
65.2%
67.3%
68.8%
70.8%
72.8%
74.1%
74.8%
75.6%
76.5%
77.2%
78.3%
79.6%
81.1%
83.8%
85.6%
87.5%
89.7%
92.1%
91.0%
92.7%
94.4%
94.8%
94.7%
94.5%
94.0%
91.8%
87.7%
83.2%
79.8%
76.5%
2011
73.1%
67.1%
62.8%
58.1%
53.0%
47.2%
45.2%
43.1%
41.3%
40.0%
39.8%
40.1%
39.0%
39.7%
40.8%
41.6%
43.4%
45.1%
47.4%
50.0%
52.0%
54.0%
55.7%
58.1%
60.1%
62.4%
64.5%
66.0%
67.0%
68.1%
68.7%
70.0%
71.8%
73.1%
74.7%
76.9%
79.1%
81.8%
84.2%
87.0%
89.5%
91.8%
93.7%
94.6%
94.9%
95.1%
95.1%
94.6%
92.1%
89.6%
87.6%
85.7%
2012 2013 2014 2015
82.3% 80.8% 68.7% 75.3%
80.2% 77.2% 61.7% 69.5%
75.5% 73.0% 59.1% 64.3%
72.3% 68.3% 53.3% 62.0%
70.4% 65.4% 46.9% 0.0%
66.2% 61.6% 41.3% 0.0%
63.2% 58.5% 35.2% 0.0%
61.2% 54.3% 32.9% 0.0%
59.3% 50.8% 29.1% 0.0%
57.7% 47.2% 24.4% 0.0%
58.0% 45.7% 23.2% 0.0%
59.4% 43.4% 21.8% 0.0%
60.4% 41.1% 20.0% 0.0%
60.6% 40.8% 20.1% 0.0%
61.0% 41.5% 20.7% 0.0%
62.1% 42.3% 21.9% 0.0%
62.8% 43.3% 23.9% 0.0%
63.5% 45.5% 25.7% 0.0%
65.0% 47.9% 28.3% 0.0%
66.9% 50.0% 30.9% 0.0%
68.6% 52.2% 33.6% 0.0%
70.1% 54.9% 36.5% 0.0%
71.8% 57.2% 39.1% 0.0%
73.3% 59.4% 41.9% 0.0%
74.7% 61.7% 44.6% 0.0%
75.6% 63.5% 47.0% 0.0%
76.4% 65.5% 49.3% 0.0%
77.1% 66.9% 51.9% 0.0%
77.7% 67.9% 54.1% 0.0%
78.4% 69.3% 56.2% 0.0%
79.0% 71.7% 58.2% 0.0%
79.5% 73.3% 60.1% 0.0%
80.6% 74.7% 62.3% 0.0%
82.2% 76.3% 64.1% 0.0%
82.9% 77.7% 66.0% 0.0%
83.6% 79.3% 68.3% 0.0%
85.2% 80.4% 70.5% 0.0%
87.2% 82.5% 72.8% 0.0%
89.0% 85.0% 75.6% 0.0%
90.8% 87.2% 78.1% 0.0%
92.0% 89.1% 80.4% 0.0%
93.7% 91.2% 82.7% 0.0%
95.2% 92.1% 84.8% 0.0%
95.8% 93.0% 87.0% 0.0%
95.3% 93.4% 88.0% 0.0%
94.4% 92.3% 87.6% 0.0%
94.5% 92.0% 83.6% 0.0%
92.7% 88.1% 83.1% 0.0%
92.8% 86.1% 81.9% 0.0%
90.8% 79.2% 80.3% 0.0%
89.0% 74.8% 79.1% 0.0%
85.7% 72.5% 78.5% 0.0%
5-yr
Avg.
75.9%
70.5%
66.5%
61.8%
57.6%
53.8%
50.5%
47.7%
45.1%
43.9%
43.5%
43.7%
43.8%
44.4%
45.5%
46.9%
48.7%
50.5%
52.7%
55.1%
57.4%
59.7%
61.9%
63.9%
65.7%
67.6%
69.5%
71.1%
72.4%
73.6%
74.7%
75.7%
77.2%
79.0%
80.6%
82.3%
84.2%
86.1%
88.2%
90.3%
91.4%
93.0%
94.5%
95.1%
95.5%
95.4%
94.9%
93.4%
90.6%
87.3%
84.4%
81.2%
Page 6 of 23
Scotia Howard Weil – Weekly Macro Update
Natural Gas Supply & Demand
Marketed Production of Natural Gas in Selected States and GOM (Bcf/d)
2012
January
February
March
April
May
June
July
August
September
October
November
December
Total
2013
January
February
March
April
May
June
July
August
September
October
November
December
Total
2014
January
February
March
April
May
June
July
August
September
October
Total
YOY October 14/13
October 14/September 14
YTD 14/13
Alaska
Louisiana
New Mexico
Oklahoma
Texas
Wyoming
Other
Non-GOM
Federal GOM
Total
1.09
1.06
1.05
0.99
0.97
0.92
0.85
0.68
0.88
0.97
1.01
1.05
0.96
8.79
8.25
8.25
8.18
8.31
8.48
8.46
8.30
8.20
8.07
7.70
7.45
8.20
3.53
3.57
3.48
3.43
3.45
3.38
3.47
3.45
3.44
3.54
3.46
3.32
3.46
5.37
5.32
5.31
5.43
5.53
5.48
5.50
5.54
5.64
5.68
5.77
5.70
5.52
19.78
19.65
19.56
19.87
19.77
19.67
19.80
19.99
20.18
19.88
19.73
19.52
19.78
6.07
5.89
5.86
5.75
5.64
5.63
5.56
5.44
5.47
5.26
5.42
5.40
5.62
20.12
20.35
20.34
20.70
21.07
21.21
21.31
21.70
22.12
22.52
22.81
22.74
21.42
64.74
64.10
63.84
64.35
64.75
64.76
64.96
65.10
65.91
65.92
65.91
65.17
64.96
4.58
4.49
4.64
4.50
4.25
3.96
4.14
3.61
3.77
4.21
4.35
4.14
4.22
69.33
68.59
68.48
68.85
69.00
68.71
69.10
68.71
69.68
70.13
70.25
69.31
69.18
1.04
1.06
1.03
0.99
0.90
0.85
0.76
0.76
0.86
0.92
0.95
1.05
0.93
7.34
7.28
6.94
6.77
6.68
6.58
6.68
6.37
6.03
5.85
5.84
5.62
6.49
3.08
3.29
3.34
3.44
3.51
3.54
3.49
3.50
3.47
3.51
3.39
3.25
3.40
5.68
5.64
5.71
5.82
5.85
5.87
5.96
5.95
5.99
5.99
6.13
5.88
5.87
19.60
19.83
19.86
20.01
20.40
20.18
20.53
20.43
20.36
20.63
20.44
19.85
20.18
5.26
5.32
5.34
5.31
5.12
5.26
5.27
5.11
4.81
5.20
5.21
4.98
5.18
22.57
23.00
22.87
23.00
23.76
24.23
24.48
25.17
25.13
25.64
26.69
27.23
24.49
64.58
65.42
65.08
65.33
66.23
66.51
67.16
67.29
66.65
67.72
68.63
67.87
66.55
4.03
3.95
3.82
3.88
3.64
3.40
3.52
3.31
3.51
3.28
3.53
3.29
3.59
68.61
69.37
68.90
69.22
69.88
69.91
70.68
70.59
70.16
71.00
72.17
71.16
70.14
1.00
1.00
0.97
0.97
0.92
0.89
0.81
0.81
0.93
0.94
9.25
3.1%
1.7%
0.8%
5.56
5.55
5.48
5.53
5.57
5.57
5.36
5.31
5.36
5.34
54.63
-8.6%
-0.3%
-17.9%
3.29
3.29
3.38
3.41
3.28
3.33
3.39
3.42
3.38
3.35
33.52
-4.4%
-0.7%
-1.9%
6.00
5.90
6.15
6.27
6.34
6.36
6.36
6.43
6.51
6.54
62.86
9.3%
0.6%
7.5%
20.83
20.02
20.40
20.90
21.04
21.13
21.08
21.54
21.51
21.65
210.11
5.0%
0.7%
4.1%
4.97
5.00
5.03
4.89
4.91
4.93
4.92
4.81
5.01
5.00
49.48
-3.7%
-0.3%
-4.8%
26.66
27.21
27.59
27.46
28.17
28.55
29.20
29.90
30.03
30.40
285.18
18.6%
1.2%
18.9%
68.31
67.97
69.00
69.42
70.24
70.76
71.12
72.22
72.73
73.24
705.02
8.2%
0.7%
6.5%
3.24
3.35
3.27
3.43
3.42
3.40
3.34
3.43
3.45
3.46
33.79
5.5%
0.1%
-7.0%
71.55
71.32
72.28
72.85
73.67
74.16
74.46
75.65
76.18
76.70
738.81
8.0%
0.7%
5.8%
Source: EIA/Howard Weil
February 2, 2015
Page 7 of 23
Scotia Howard Weil – Weekly Macro Update
Natural Gas Supply & Demand
U.S. Natural Gas Supply - Data Through October 2014 (Tcf)
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
January
February
March
April
May
June
July
August
September
October
November
December
2014
January
February
March
April
May
June
July
August
September
October
2014 YTD
2013 YTD
% Change
Dry Gas Supplemental
Net
Production
Fuels
Imports
19.18
0.09
3.54
19.62
0.09
3.60
18.96
0.06
3.50
19.10
0.07
3.27
18.76
0.06
3.40
18.05
0.06
3.61
18.50
0.07
3.46
19.27
0.06
3.79
20.16
0.06
2.98
20.58
0.06
2.68
21.50
0.07
2.61
22.90
0.06
1.96
24.06
0.06
1.52
U.S. Natural Gas Consumption - Data Through October 2014 (Tcf)
Net
Storage Balancing Demand
0.83
(0.27)
23.37
(1.17)
0.10
22.23
0.47
0.03
23.02
(0.20)
0.05
22.28
(0.12)
0.31
22.42
0.05
0.23
22.01
(0.44)
0.09
21.69
0.19
(0.21)
23.10
0.03
(0.01)
23.22
(0.36)
(0.13)
22.83
(1.67)
0.12
22.62
(0.35)
(0.18)
24.38
(0.01)
(0.13)
25.51
Avg. Daily
Supply
(Bcf/day)
61.75
64.12
61.78
61.58
61.74
60.16
60.61
62.75
63.54
63.53
66.54
67.78
69.71
2.02
1.84
2.03
1.98
2.06
1.99
2.08
2.07
1.99
2.08
2.05
2.09
0.01
0.01
0.01
0.01
0.01
0.00
0.00
0.01
0.01
0.00
0.01
0.01
0.12
0.10
0.10
0.10
0.09
0.10
0.11
0.11
0.12
0.10
0.11
0.16
0.72
0.60
0.38
(0.14)
(0.42)
(0.37)
(0.28)
(0.27)
(0.35)
(0.26)
0.21
0.71
(0.00)
0.00
0.00
0.01
0.01
0.01
0.01
0.01
(0.01)
(0.07)
(0.06)
(0.05)
2.87
2.56
2.52
1.96
1.75
1.73
1.92
1.92
1.76
1.86
2.31
2.91
69.39
69.89
68.90
69.77
69.84
70.17
70.71
70.55
70.23
68.10
70.03
70.97
2.10
1.89
2.12
2.06
2.12
2.10
2.17
2.22
2.15
2.24
21.15
20.13
5%
0.01
0.01
0.00
0.01
0.01
0.01
0.01
0.00
0.00
0.01
0.05
0.05
0%
0.16
0.11
0.09
0.08
0.09
0.08
0.07
0.09
0.08
0.11
0.96
1.05
-9%
0.97
0.73
0.35
(0.22)
(0.47)
(0.46)
(0.40)
(0.37)
(0.42)
(0.40)
(0.70)
(0.37)
88%
0.00
0.04
0.02
0.05
0.05
0.05
0.05
0.19
0.02
(0.01)
0.47
(0.03)
NM
3.24
2.77
2.58
1.97
1.79
1.77
1.90
2.13
1.83
1.94
21.94
20.83
5%
7.46
6.73
7.33
7.21
7.45
7.34
7.58
8.23
7.42
7.70
74.45
69.75
7%
Source: EIA/Howard Weil
February 2, 2015
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Residential Commercial Industrial
5.00
3.22
8.14
4.77
3.02
7.35
4.89
3.10
7.56
5.08
3.18
7.15
4.89
3.14
7.25
4.83
3.00
6.60
4.37
2.83
6.51
4.72
3.01
6.65
4.89
3.15
6.66
4.78
3.12
6.58
4.78
3.10
6.83
4.71
3.16
6.91
4.18
2.91
7.14
January
February
March
April
May
June
July
August
September
October
November
December
2014
January
February
March
April
May
June
July
August
September
October
2014 YTD
2013 YTD
Change
Electric
5.21
5.34
5.67
5.14
5.46
5.87
6.22
6.84
6.67
6.87
7.39
7.57
9.14
Other
1.81
1.76
1.79
1.74
1.69
1.71
1.75
1.87
1.89
1.90
1.99
2.04
2.62
Total
23.37
22.24
23.02
22.29
22.43
22.00
21.69
23.26
23.27
23.25
24.09
24.38
25.98
0.88
0.76
0.67
0.37
0.19
0.13
0.11
0.11
0.12
0.23
0.52
0.86
0.48
0.43
0.39
0.25
0.17
0.14
0.14
0.14
0.14
0.21
0.34
0.48
0.68
0.62
0.65
0.60
0.59
0.56
0.58
0.59
0.58
0.62
0.66
0.71
0.63
0.57
0.60
0.56
0.62
0.74
0.91
0.90
0.75
0.64
0.60
0.66
0.20
0.18
0.19
0.17
0.17
0.17
0.18
0.18
0.17
0.18
0.19
0.21
2.86
2.55
2.51
1.95
1.74
1.73
1.91
1.91
1.76
1.86
2.31
2.91
1.04
0.85
0.70
0.35
0.20
0.13
0.11
0.11
0.12
0.21
3.81
3.57
6.9%
0.57
0.49
0.42
0.25
0.17
0.14
0.14
0.14
0.15
0.20
2.65
2.47
7.4%
0.72
0.66
0.68
0.63
0.61
0.59
0.61
0.61
0.59
0.61
6.31
6.05
4.3%
0.66
0.55
0.56
0.55
0.65
0.72
0.84
0.90
0.77
0.70
6.89
6.90
-0.1%
0.25
0.22
0.23
0.20
0.20
0.20
0.21
0.21
0.21
0.21
2.13
1.79
19.4%
3.24
2.77
2.58
1.97
1.83
1.77
1.90
1.96
1.84
1.94
21.80
20.78
4.9%
Avg. Daily
Consumption
(Bcf/day)
64.0
60.9
63.1
61.1
61.4
60.3
59.4
63.7
63.6
63.7
66.0
66.8
71.0
92.4
91.2
80.9
64.9
56.1
57.6
61.6
61.6
58.5
60.0
76.8
94.0
104.5
99.0
83.3
65.8
58.9
59.0
61.4
63.2
61.3
62.6
718.94
685.0
5.0%
Source: DOE/EIA
Page 8 of 23
Scotia Howard Weil – Weekly Macro Update
Natural Gas Imports & Exports
U.S. Natural Gas Imports and Exports
Source: EIA, Natural Gas Annual and Monthly
Data Through October 2014 (Tcf)
Jan-15
Nov-14
Sep-14
Jul-14
May-14
Avg. '15 % Change Week Ending
$7.26
0.0% 1/30/2015
1/23/2015
1/31/2014
Mar-14
Jan-14
Nov-13
Sep-13
Jul-13
May-13
Mar-13
Jan-13
Nov-12
Sep-12
Avg. '14
$6.73
$7.89
$8.45
$8.39
Jul-12
Avg. '13
$10.67
$10.85
$9.97
$10.61
May-12
3.0%
-33.5%
-20.7%
-7.0%
17.2%
-11.4%
-9.7%
23.4%
-10.3%
29.3%
Avg. '12
$9.29
$9.10
$8.99
$10.48
Mar-12
5.18
3.82
2.73
2.62
2.98
2.73
2.38
2.94
2.73
3.41
3.15
2.73
15.5%
Avg. '11
$9.16
$9.39
$8.73
$8.92
Jan-12
0.16
0.11
0.08
0.08
0.09
0.08
0.07
0.09
0.08
0.11
0.96
0.83
15.5%
1Q
2Q
3Q
4Q
Nov-11
0.13
0.14
0.15
0.12
0.11
0.12
0.13
0.12
0.12
0.12
1.26
1.34
-6.3%
$0
Sep-11
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.02
0.00
NM
$2
Jul-11
0.13
0.14
0.15
0.12
0.11
0.12
0.12
0.11
0.12
0.11
1.24
1.34
-7.5%
$4
May-11
0.30
0.25
0.23
0.20
0.21
0.20
0.20
0.21
0.20
0.22
2.21
2.17
2.0%
3.99
33.3%
3.70
-16.2%
3.22
-3.7%
3.17
-4.7%
(4.12) -234.6%
3.43 -180.5%
3.47
4.5%
3.39
-2.2%
4.05
15.4%
3.16
-19.3%
3.59
9.9%
5.03
44.7%
$6
Mar-11
0.12
0.10
0.10
0.09
(0.13)
0.10
0.11
0.11
0.12
0.10
0.11
0.16
$8
Jan-11
0.15
0.13
0.15
0.13
0.14
0.13
0.13
0.13
0.12
0.12
0.11
0.12
$10
Nov-10
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
$12
Sep-10
0.15
0.13
0.15
0.13
0.14
0.13
0.13
0.13
0.12
0.12
0.11
0.12
$14
Jul-10
0.28
0.24
0.25
0.22
0.01
0.24
0.24
0.24
0.24
0.22
0.22
0.27
$16
May-10
0.01
0.01
0.01
0.01
0.01
0.01
0.01
0.01
0.02
0.01
0.00
0.00
$18
Mar-10
Total
0.24
0.36
0.52
0.69
0.76
0.73
0.72
0.82
1.01
1.07
1.14
1.34
1.62
Jan-10
0.26
0.23
0.24
0.22
0.01
0.23
0.23
0.23
0.23
0.21
0.22
0.27
0.29
0.01
0.24
0.00
0.23
0.00
0.20
0.00
0.20
0.00
0.19
0.01
0.19
0.01
0.20
0.00
0.20
0.01
0.21
0.01
2.16
0.05
2.08
0.09
4.0% -43.5%
Pipeline
0.18
0.30
0.45
0.63
0.70
0.66
0.66
0.77
0.96
1.04
1.07
1.28
1.59
Nov-09
Total
3.78
3.98
4.02
4.00
4.21
4.34
4.19
4.61
3.98
3.75
3.74
3.17
3.14
North Sea Gas ($/Mcf)
2009 - Present
Sep-09
Pipeline
3.56
3.74
3.79
3.49
3.56
3.71
3.60
3.84
3.63
3.30
3.31
2.85
2.96
Daily Net
Total Net Imports
Imports (Bcf/d) Change
3.54
9.69
3.4%
3.61
9.90
2.1%
3.50
9.59
-3.2%
3.30
9.05
-5.6%
3.45
9.45
4.4%
3.61
9.90
4.7%
3.46
9.49
-4.2%
3.79
10.37
9.3%
2.98
8.16 -21.3%
2.68
7.34 -10.1%
2.60
7.13
-2.8%
1.83
5.01 -29.8%
1.52
4.15 -17.0%
Exports
LNG
0.07
0.07
0.06
0.06
0.06
0.07
0.06
0.05
0.05
0.03
0.07
0.07
0.03
Jul-09
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
January
February
March
April
May
June
July
August
September
October
November
December
2014
January
February
March
April
May
June
July
August
September
October
2014 YTD
2013 YTD
Change
Imports
LNG
0.23
0.24
0.23
0.51
0.65
0.63
0.58
0.77
0.35
0.45
0.43
0.32
0.17
Price % Change
$7.40
$6.66
11.1%
$10.08
-26.5%
North Sea Gas Prices
•
North Sea natural gas prices rose by 11.1% versus the
previous week. Prices averaged $7.40/Mcf. A year ago gas
prices averaged $10.08 per Mcf.
3.5%
9.1%
-61.3%
Source: DOE/EIA
February 2, 2015
Page 9 of 23
Scotia Howard Weil – Weekly Macro Update
Degree Day Statistics
U.S. Heating Degree Days
Gas Home Heating
% Colder/
% Colder/
This Last Dev from Dev from (Warmer) vs. (Warmer) vs.
Year Year Normal Last Yr.
Last Year
Normal
Month
October-14
November-14
December-14
Total 4Q'14
1/3/2015
1/10/2015
1/17/2015
1/24/2015
1/31/2015
Total 1Q'15
249
285
544
484
519
650
1,312 1,419
228
227
258
262
229
170
182
247
200
257
1,097 1,163
(61)
30
(96)
(127)
7
33
3
(43)
(20)
(20)
(36)
60
(131)
(107)
1
(4)
59
(65)
(57)
(66)
(12.6%)
12.4%
(20.2%)
(7.5%)
0.4%
(1.5%)
34.7%
(26.3%)
(22.2%)
(5.7%)
(19.7%)
5.8%
(15.6%)
(8.8%)
3.2%
14.7%
1.3%
(19.1%)
(9.1%)
(1.8%)
U.S. Heating Degree Days
Electric Home Heating Customer Weighted
Month
October-14
November-14
December-14
Total 4Q'14
1/3/2015
1/10/2015
1/17/2015
1/24/2015
1/31/2015
Total 1Q'15
Winter
'12/'13
% Colder/
% Colder/
This Last Dev from Dev from (Warmer) vs. (Warmer) vs.
Year Year Normal Last Yr.
Last Year
Normal
151
189
(52)
(38)
(20.1%)
(25.6%)
488
443
23
45
10.2%
4.9%
440
512
(47)
(72)
(14.1%)
(9.7%)
1,079 1,144
(76)
(65)
(5.7%)
(6.6%)
162
162
(2)
0
0.0%
(1.2%)
187
193
21
(6)
(3.1%)
12.7%
166
128
(1)
38
29.7%
(0.6%)
131
187
(34)
(56)
(29.9%)
(20.6%)
146
166
(46)
(20)
(12.0%)
(24.0%)
792 Winter
836 Winter
Winter
'12/'13
'12/'13(62)
'12/'13
Winter(44)
'12/'13
Winter(5.3%)
'12/'13 Winter(7.3%)
'12/'13
Month
% Warmer/ % Warmer/
This Last Dev from Dev from (Colder) vs. (Colder) vs.
Year Year Normal Last Yr. Last Year
Normal
Total 2Q'14
July-14
August-14
September-14
Total 3Q'14
10/3/2014
10/10/2014
10/17/2014
10/24/2014
Total 4Q'14
391
284
329
187
800
27
23
13
8
71
392
333
326
194
853
28
18
10
6
62
51
(3)
(7)
36
26
6
7
1
0
14
(1)
(49)
3
(7)
(53)
(1)
5
3
2
9
(0.3%)
-14.7%
0.9%
-3.6%
(6.2%)
-3.6%
27.8%
30.0%
33.3%
14.5%
15.0%
-1.0%
-2.1%
23.8%
3.4%
28.6%
43.8%
8.3%
0.0%
24.6%
Source: NOAA
Source: NOAA
February 2, 2015
Page 10 of 23
Scotia Howard Weil – Weekly Macro Update
Basis Differentials
Regional Gas Prices and Basis Differential to Henry Hub ($/MMBtu)
Basis Differential.
Prices ($/MMBtu)
Henry Hub
Rockies
Appalachia
California
Basis Differential
Rockies Appalachia California
2009
Q1
Q2
Q3
Q4
$4.68
$3.69
$3.24
$4.20
$3.17
$2.58
$2.80
$4.04
$4.99
$3.86
$3.28
$4.40
$3.84
$3.10
$3.15
$4.38
($1.51)
($1.11)
($0.44)
($0.16)
$0.31
$0.18
$0.04
$0.21
($0.84)
($0.58)
($0.09)
$0.18
Q1
Q2
Q3
Q4
$5.11
$4.31
$4.28
$3.79
$4.82
$3.84
$3.52
$3.58
$5.31
$4.46
$4.39
$3.95
$5.15
$4.10
$3.96
$3.74
($0.28)
($0.47)
($0.76)
($0.21)
$0.20
$0.15
$0.11
$0.16
$0.04
($0.21)
($0.32)
($0.05)
Q1
Q2
Q3
Q4
$4.17
$4.35
$4.13
$3.34
$4.00
$4.05
$3.91
$3.31
$4.28
$4.47
$4.18
$3.38
$4.16
$4.34
$4.24
$3.50
($0.17)
($0.30)
($0.22)
($0.03)
$0.11
$0.12
$0.05
$0.04
($0.01)
($0.01)
$0.11
$0.16
Q1
Q2
Q3
Q4
$2.49
$2.26
$2.87
$3.37
$2.44
$2.12
$2.74
$3.38
$2.50
$2.28
$2.88
$3.42
$2.68
$2.43
$2.98
$3.58
($0.04)
($0.14)
($0.14)
$0.01
$0.01
$0.02
$0.01
$0.04
$0.19
$0.16
$0.11
$0.21
Q1
Q2
Q3
Q4
$3.47
$4.02
$3.55
$3.61
$3.47
$3.83
$3.43
$3.55
$3.52
$4.05
$3.55
$3.59
$3.64
$3.99
$3.68
$3.68
$0.01
($0.19)
($0.13)
($0.06)
$0.05
$0.03
($0.01)
($0.01)
$0.17
($0.02)
$0.12
$0.08
Q1
Q2
Q3
Q4
$5.09
$4.57
$3.99
$3.86
$5.40
$4.45
$3.93
$3.76
$5.15
$4.50
$3.97
$3.82
$5.18
$4.67
$4.25
$3.95
$0.31
($0.12)
($0.06)
($0.10)
$0.05
($0.07)
($0.01)
($0.04)
$0.08
$0.09
$0.27
$0.09
Q1
Q2
Q3
Q4
$2.97
-
$3.10
-
$2.88
-
$3.13
-
$0.14
-
($0.09)
-
$0.17
-
2010
2011
•
•
For the week ending 1/30/15 the Rockies
Basis differential averaged ($0.28) per
MMBtu. Last year’s Rockies Basis
differential averaged ($0.30) per MMBtu.
For the fourth quarter the Rockies Basis
differential averaged ($0.10) per MMBtu.
The 4Q13 Rockies Basis differential
averaged ($0.06) per MMBtu.
2012
2013
2014
2015
Week
1/31/2014
1/30/2015
Hub
$5.28
$2.93
Rockies
$4.98
$2.65
Appalachia
$5.45
$2.76
California
$5.06
$2.78
Rockies Appalachia California
($0.30)
$0.17
($0.22)
($0.28)
($0.17)
($0.15)
Souce: Platts Gas Daily, Bloomberg
February 2, 2015
Page 11 of 23
Scotia Howard Weil – Weekly Macro Update
Basis Differentials
Regional Crude Prices and Basis Differential to WTI Cushing ($/Bbl)
Prices ($/Bbl)
Brent
LLS
WTI Cushing
HLS
WTI Midland
Brent
Basis Differential
LLS
HLS WTI Midland
2010
Q1
Q2
Q3
Q4
$78.76
$77.93
$76.01
$85.22
$77.03
$78.83
$77.46
$87.70
$79.98
$82.21
$79.62
$89.45
$78.84
$81.35
$78.14
$88.29
$78.56
$77.71
$75.75
$84.69
($1.73)
$0.91
$1.46
$2.48
$1.21
$4.28
$3.62
$4.24
$0.08
$3.43
$2.13
$3.08
($0.21)
($0.21)
($0.26)
($0.53)
Q1
Q2
Q3
Q4
$94.28
$102.40
$89.55
$94.15
$105.63
$117.97
$113.58
$110.17
$107.60
$118.47
$112.44
$110.72
$106.94
$117.99
$114.33
$111.08
$93.74
$102.01
$89.02
$93.53
$11.34
$15.57
$24.04
$16.02
$13.32
$16.07
$22.90
$16.58
$12.66
$15.59
$24.79
$16.94
($0.54)
($0.39)
($0.53)
($0.62)
Q1
Q2
Q3
Q4
$102.86
$93.42
$92.16
$88.15
$119.58
$109.52
$110.46
$111.63
$119.38
$108.46
$109.41
$109.49
$121.15
$109.47
$109.27
$109.00
$100.00
$88.81
$91.01
$80.44
$16.72
$16.10
$18.31
$23.48
$16.52
$15.04
$17.25
$21.33
$18.29
$16.06
$17.11
$20.85
($2.86)
($4.61)
($1.15)
($7.71)
Q1
Q2
Q3
Q4
$94.35
$94.13
$105.78
$97.51
$113.92
$103.43
$109.01
$109.36
$113.92
$104.73
$109.99
$101.11
$114.15
$104.63
$109.89
$101.27
$90.91
$94.07
$105.43
$94.39
$19.57
$9.29
$3.24
$11.85
$19.57
$10.60
$4.21
$3.61
$19.80
$10.50
$4.12
$3.77
($3.44)
($0.07)
($0.34)
($3.11)
Q1
Q2
Q3
Q4
$98.61
$103.11
$97.67
$72.95
$109.36
$109.73
$103.58
$77.53
$104.37
$105.59
$101.09
$75.83
$104.32
$105.68
$99.94
$74.53
$92.72
$95.47
$87.07
$69.66
$10.75
$6.62
$5.91
$4.58
$5.76
$2.48
$3.42
$2.89
$5.71
$2.57
$2.27
$1.58
($5.89)
($7.64)
($10.60)
($3.29)
Q1
Q2
Q3
Q4
$45.74
$48.34
$48.21
$47.69
$44.16
$2.60
$2.47
Basis Differential
•
For the week end, the Brent basis
differential averaged $2.57. Last weeks
Brent basis differential was $2.11. Last
year, the Brent basis differential averaged
$10.30.
•
For the first quarter of 2015 the Brent
basis differential averaged $2.60. The
4Q14 Brent basis differential was $4.58.
2011
2012
2013
2014
2015
Week
1/31/2014
1/30/2015
1/23/2015
WTI Cushing
$97.24
$45.72
$46.71
Brent
$107.54
$48.29
$48.82
LLS
$102.21
$47.92
$48.34
-
-
HLS WTI Midland
$102.33
$92.70
$47.43
$43.97
$47.52
$43.59
Brent
$10.30
$2.57
$2.11
$1.95
-
LLS
$4.97
$2.20
$1.63
($1.58)
-
-
HLS WTI Midland
$5.09
($4.54)
($0.86)
($1.75)
($1.30)
($3.12)
Source: Bloomberg, Howard Weil
February 2, 2015
Page 12 of 23
Scotia Howard Weil – Weekly Macro Update
Rig Counts
Gas Rigs per 1 Bcf/d
US Oil & Gas Avg. Rig Count (1991 - Present)
(US Production)
1,750
35.0
1,500
30.0
1,250
25.0
1,000
750
20.0
500
15.0
250
10.0
0
5.0
Feb-14
Feb-13
Aug-13
Feb-12
Aug-12
Feb-11
Aug-11
Feb-10
Aug-10
Feb-09
Aug-09
Feb-08
Aug-08
Feb-07
Aug-07
Feb-06
Aug-06
Feb-05
Aug-05
Feb-04
Aug-04
Feb-03
Aug-03
Feb-02
Aug-02
Feb-01
Gas
Aug-01
Feb-00
Oil
Source: Baker Hughes
Aug-00
0.0
Source: Howard Weil; Baker Hughes; EIA
• For the period ended January 30, 2015, the U.S. gas rig count
was up versus the pervious week to 319. In 2012, the gas rig count
declined by 378 rigs. In 2013, the gas rig count decreased by 59
rigs. YTD 2015, the gas rig count has decreased by 21 rigs.
U.S. Gas Rig Count (Trailing 7 Weeks)
# of Rigs
500
300
372
374
374
357
338
340
328
329
365
356
358
310
316
319
100
Year Ago
Current
Source: Baker Hughes, Inc.
February 2, 2015
Page 13 of 23
Scotia Howard Weil – Weekly Macro Update
Rig Counts
US Horizontal Rig Count (Jan 2010 - Present)
• For the week ended January 30, 2015, the U.S.
horizontal rig count decreased to 1,168. The
horizontal rig count is flat year-over-year.
• The horizontal rig count increased by 376 in
2010 and by 220 in 2011. In 2012 the horizontal
rig count fell by 56. In 2013 the horizontal rig
count rose by 35. YTD 2015, the horizontal rig
count has decreased by 182 rigs.
Jan-15
Jul-14
Oct-14
Jan-14
Apr-14
Jul-13
Oct-13
Jan-13
Apr-13
Jul-12
Oct-12
Jan-12
Apr-12
Jul-11
Oct-11
Jan-11
Apr-11
Oct-10
Jul-10
Jan-10
Apr-10
1,500
1,400
1,300
1,200
1,100
1,000
900
800
700
600
500
Source: Baker Hughes
Updating: Weekly
US Oil Rig Count (Jan 2010 - Present)
US Natural Gas Rig Count (Jan 2010 - Present)
Jan-15
Jul-14
Oct-14
Jan-14
Apr-14
Jul-13
Oct-13
Jan-13
Apr-13
Jul-12
Oct-12
Jan-12
Apr-12
Jan-15
Oct-14
Jul-14
Apr-14
Jan-14
Oct-13
Jul-13
Apr-13
Jan-13
Oct-12
Jul-12
Apr-12
Jan-12
Oct-11
Jul-11
Apr-11
Jan-11
Jul-10
Oct-10
Jan-10
Apr-10
300
Jul-11
400
Oct-11
500
Jan-11
600
Apr-11
700
Jul-10
800
Oct-10
900
1,800
1,600
1,400
1,200
1,000
800
600
400
200
0
Jan-10
1,000
Apr-10
1,100
Source: Baker Hughes
February 2, 2015
Page 14 of 23
Scotia Howard Weil – Weekly Macro Update
Gulf Coast & Rockies Frac Spreads
GC Frac Spread
•
For the week end 1/30/15, the Gulf Coast
Frac Spread averaged $1.81 (71.3%).
•
For the Year ended 2014, the Gulf Coast
Frac Spread averaged $4.60. The 2013 Gulf
Coast Frac Spread averaged $5.85.
Rockies Frac Spread.
•
For the week end 1/31/15, the Rockies Frac
Spread averaged $2.04 (68.0%).
•
February 2, 2015
For the Year ended 2014, the Rockies Frac
Spread averaged $4.62. The 2013 Gulf
Coast Frac Spread averaged $5.91.
Page 15 of 23
Scotia Howard Weil – Weekly Macro Update
Electricity
Electricity
U.S. Electricity Output
•
Electricity output during the
week ended January 23, 2015,
fell by 10.5% Y/Y.
•
Year-to-date, electricity output is
5.04% above 2014 levels.
100,000
95,000
Gigawatt Hours
90,000
85,000
80,000
75,000
70,000
65,000
60,000
2013
2014
2 1
00
2 1
05
1Q
Avg. 2012
73,460
Avg. 2012
73,166
Avg. 2013
75,397
2Q
75,525
75,525
73,885
73,459
3Q
86,022
84,233
85,911
85,239
73,797
73,105
72,115
72,007
4Q
Source: Bloomberg
Note: HDD reflects electric home heating data
February 2, 2015
2015
3 Y r .A v g .
Avg. 2014 Avg. 2015 TD % Change
78,424
82,368
5.0%
Week Ending
1/23/2015
1/24/2014
% Change
vs Prev. Yr.
76,681
85,698
Home Heating
Week Ending
1/23/2015
1/24/2014
-10.5%
% Change
vs Prev.Yr.
188
239
-21.3%
Page 16 of 23
Scotia Howard Weil – Weekly Macro Update
Nuclear Conditions
U.S. Nuclear Capacity Factor
2010
2011
2012
2013
2014
Jan
96.4
96.6
95.9
94.4
96.1
Feb
96.0
95.3
90.5
90.0
91.7
Mar
85.9
87.2
81.8
79.9
83.4
Apr
79.1
74.9
76.5
75.6
78.8
May
88.6
75.8
82.3
80.3
84.7
Jun
93.8
89.5
89.2
88.0
95.0
Jul
95.5
96.0
91.5
92.8
97.2
Aug
95.1
94.6
92.0
96.2
97.1
Sep
95.2
91.6
88.1
91.5
93.9
Oct
83.4
84.0
79.0
84.2
82.9
Nov
86.0
88.4
77.4
87.9
88.7
Dec Avg. TD
97.9
91.1
95.2
89.1
90.6
86.2
93.7
87.9
96.1
90.5
Nuclear
•
For the week ended January 30,
2015, the average capacity factor of
the nuclear generation fleet fell to
96.1% from 97.3% the prior week.
Source: Howard Weil; EIA
italics represent estimates
Nuclear Capacity Factor (%)
100
95
90
85
80
75
70
65
60
Jan
Feb
Mar
Apr
May
Jun
2011
Jul
2012
2013
Aug
Sep
Oct
Nov
Dec
2014
Source: EIA, Nuclear Regulatory Commission and Howard Weil
February 2, 2015
Page 17 of 23
Scotia Howard Weil – Weekly Macro Update
E&P Returns
1 Month Performance
GDP
SFY
-60%
-50%
WTI
CRK
SD
EOX
CXO
NOG
MTDR
NFX
CRZO
BCEI
KOS
TPLM
MRD
CPE
CIE
QEP
LINE
EPE
NBL
PXD
APA
DVN
OXY
AREX
SM
APC
CHK
UPL
XEC
EOG
EPX
S&P 500
MRO
WPX
LPI
GPOR
MPO
HES
SWN
HDY
WLL
COG
EXXI
MUR
BBG
RRC
UNT
SGY
DNR
HK
ROSE
PVA
PQ
3 Month Performance
CLR
FANG
AREX
PVA
UNT
BCEI
SGY
NOG
WPX
WTI
UPL
LPI
EOX
-40%
-30%
-20%
-10%
0%
10%
20%
30%
-80%
ROSE
HDY
HK
MPO
LINE
EXXI
SD
CRK
SFY
GDP
-70%
EPE
MRD
RRC
SM
BBG
TPLM
PQ
EOG
KOS
OXY
XEC
NFX
MTDR
APC
CRZO
CHK
CPE
COG
MUR
QEP
NBL
APA
CLR
GPOR
EPX
HES
PXD
CIE
SWN
MRO
CXO
DVN
FANG
S&P 500
WLL
-60%
-50%
6 Month Performance
-40%
-30%
-20%
-10%
0%
10%
YTD Performance
OXY
S&P 500
KOS
CLR
FANG
NOG
CXO
TPLM
NFX
BCEI
CRZO
MTDR
KOS
CIE
LINE
CPE
PXD
NBL
QEP
FANG
MRD
COG
EOG
MTDR
DVN
CXO
APC
XEC
NFX
NBL
CHK
GPOR
CRZO
MUR
MRO
HES
PXD
EPX
APA
OXY
APC
DVN
AREX
CHK
SM
XEC
S&P 500
EOG
EPX
LPI
UPL
HDY
MRO
GPOR
WPX
HES
SWN
WLL
COG
BBG
EXXI
MUR
UNT
MPO
RRC
SGY
APA
RRC
CLR
SWN
QEP
CIE
UPL
EPE
CPE
WPX
SM
TPLM
BCEI
UNT
PQ
BBG
NOG
WTI
SGY
WLL
PVA
LINE
ROSE
AREX
HDY
HK
HK
PQ
ROSE
SD
SD
MPO
SFY
CRK
EXXI
GDP
EOX
PVA
WTI
EOX
CRK
GDP
-100%
-90%
-80%
-70%
-60%
-50%
-40%
-30%
-20%
-10%
0%
SFY
10%
-60%
February 2, 2015
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
Page 18 of 23
Scotia Howard Weil – Weekly Macro Update
E&P Returns – Mid Cap
3 Month Performance
1 Month Performance
PDCE
CLR
CXO
CXO
PDCE
S&P 500
KOS
MTDR
XEC
NFX
NFX
BCEI
MTDR
KOS
COG
MRD
QEP
CIE
CLR
QEP
GPOR
LINE
EPX
EPE
PXD
PXD
CIE
SM
EPE
UPL
MRD
XEC
EPX
RRC
S&P 500
SM
UNT
WPX
LPI
BCEI
WPX
WLL
UPL
LPI
COG
EXXI
WLL
RRC
HK
LINE
UNT
HK
EXXI
SD
SD
-30%
-20%
-10%
0%
10%
20%
30%
-70%
-60%
-50%
-40%
6 Month Performance
-30%
-20%
-10%
0%
10%
20%
YTD Performance
S&P 500
CLR
KOS
PDCE
PDCE
CXO
MRD
NFX
COG
BCEI
MTDR
MTDR
CXO
MRD
XEC
NFX
KOS
CIE
LINE
PXD
PXD
EPX
QEP
RRC
EPE
CLR
SM
QEP
XEC
CIE
S&P 500
UPL
EPX
EPE
UPL
WPX
LPI
SM
BCEI
WPX
UNT
WLL
LPI
COG
WLL
EXXI
WLL
UNT
LINE
RRC
DNR
HK
SD
HK
EXXI
-100%
February 2, 2015
-90%
SD
-80%
-70%
-60%
-50%
-40%
-30%
-20%
-10%
0%
10%
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
Page 19 of 23
Scotia Howard Weil – Weekly Macro Update
E&P Returns – Small Cap
3 Month Performance
1 Month Performance
FANG
FANG
S&P 500
NOG
CRZO
CRZO
CPE
BCEI
EPX
TPLM
BBG
CPE
TPLM
AREX
PQ
EPX
AREX
S&P 500
PVA
MPO
HDY
BCEI
BBG
SGY
SGY
NOG
ROSE
WTI
PVA
ROSE
PQ
HDY
WTI
MPO
CRK
CRK
GDP
SFY
SFY
-60%
-50%
-40%
-30%
-20%
-10%
0%
10%
GDP
20%
-80%
-70%
-60%
-50%
-40%
-30%
-20%
-10%
0%
YTD Performance
6 Month Performance
FANG
S&P 500
NOG
FANG
TPLM
CRZO
BCEI
EPX
CRZO
CPE
CPE
TPLM
AREX
BCEI
S&P 500
PQ
EPX
BBG
HDY
NOG
BBG
WTI
MPO
SGY
SGY
PVA
PQ
ROSE
ROSE
AREX
PVA
HDY
WTI
MPO
CRK
SFY
GDP
CRK
SFY
GDP
-100%
February 2, 2015
-90%
10%
-80%
-70%
-60%
-50%
-40%
-30%
-20%
-10%
0%
10%
-60.00%
-50.00%
-40.00%
-30.00%
-20.00%
-10.00%
0.00%
10.00%
20.00%
Page 20 of 23
Scotia Howard Weil – Weekly Macro Update
Oil Service - Returns
1 Month Performance
6 Month Performance
BHI
PTEN
HAL
DRC
PHIIK
GIFI
BHI
DRC
ATW
SPN
DRQ
BRS
OII
SLB
DRQ
DO
RDC
NOV
OIS
OSX
EXH
TS
CLB
CAM
FTI
TDW
ATW
NE
SPN
HAL
ESV
HP
HOS
PTEN
WFT
TTI
NBR
RIG
PDS
SLB
NE
TS
ESV
KEG
SDRL
WFT
PHIIK
CAM
NBR
TDW
HP
RDC
OII
OSX
HOS
RIG
BRS
GIFI
OIS
EXH
PDS
DO
NOV
CRR
FTI
MDR
SDRL
KEG
CRR
HERO
CLB
MDR
TTI
HERO
-35%
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
-100%
-80%
-60%
3 Month Performance
-40%
-20%
0%
20%
YTD Performance
BHI
PTEN
BHI
HAL
ATW
KEG
DRC
RDC
SLB
DO
DRQ
GIFI
SPN
NE
TDW
PHIIK
OII
NOV
CAM
BRS
OSX
PTEN
HAL
HOS
TS
ATW
EXH
HP
ESV
OIS
FTI
CLB
NBR
WFT
CRR
PDS
MDR
SPN
NE
DRC
DRQ
SLB
ESV
TS
PHIIK
WFT
RDC
TDW
SDRL
CAM
NBR
HOS
OII
RIG
OSX
HP
DO
GIFI
BRS
OIS
PDS
EXH
NOV
CRR
FTI
RIG
KEG
TTI
MDR
CLB
SDRL
TTI
HERO
HERO
-70%
February 2, 2015
-60%
40%
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
-35%
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
Page 21 of 23
Scotia Howard Weil – Weekly Macro Update
Majors/Integrateds/Refiners - Returns
1 Month Performance
6 Month Performance
TSO
DK
DK
TSO
VLO
VLO
PBF
PBF
S&P 500
BP
TOT
PSX
XOM
PSX
S&P 500
HFC
HFC
BP
XOM
TOT
HES
CVX
COP
CVX
COP
MUR
MUR
HES
PBR
-20%
PBR
-15%
-10%
-5%
0%
5%
10%
15%
-80%
-60%
-40%
3 Month Performance
-20%
0%
20%
40%
YTD Performance
TSO
DK
PBF
TSO
VLO
VLO
S&P 500
PBF
DK
BP
XOM
TOT
PSX
PSX
BP
S&P 500
COP
HFC
TOT
XOM
CVX
HES
MUR
COP
HES
CVX
HFC
MUR
PBR
-60%
February 2, 2015
-50%
60%
PBR
-40%
-30%
-20%
-10%
0%
10%
20%
30%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
Page 22 of 23
Appendix A: Important Disclosures
Scotia Howard Weil – Weekly Macro Update
We, Joseph Bachmann, Park Carrere, Brian Corales, Jonathan Donnel, Blake Fernandez, Alonso Guerra-Garcia, K. Blake Hancock, Blake Hutchinson, Geoff Jacques, Peter Kissel, Richard Roberts, Bill Sanchez,
Holly Stewart, Philip Stuart and Dave Wilson, certify that the views expressed in this research report accurately reflect our personal views about the subject securities or issuers; and we, Joseph Bachmann,
Park Carrere, Brian Corales, Jonathan Donnel, Blake Fernandez, Alonso Guerra-Garcia, K. Blake Hancock, Blake Hutchinson, Peter Kissel, Richard Roberts, Bill Sanchez, Holly Stewart, Philip Stuart and Dave
Wilson, certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation or views contained in this research report.
This report was prepared by a Scotia Howard Weil Research analyst. Scotia Howard Weil is a Division of Scotia Capital (USA) Inc., a US Registered broker-dealer and a member of the
New York Stock Exchange and FINRA. Scotia Howard Weil Research analysts focus primarily on the US Energy Sector. Scotia Capital (USA) Inc. is a wholly owned subsidiary of
Scotia Capital Inc., a Canadian registered investment dealer, and indirectly owned by The Bank of Nova Scotia. Scotiabank, together with “Global Banking and Markets”, is a marketing
name for the global corporate and investment banking and capital markets businesses of The Bank of Nova Scotia and certain of its affiliates in the countries where they operate,
including Scotia Capital Inc. and Scotia Capital (USA) Inc. In addition to Scotia Howard Weil Research, Scotiabank publishes and distributes Scotiabank Global Banking and Markets
Equity Research (“Scotiabank Research”), which is a separate research publication. Scotia Howard Weil Research Analysts and Scotiabank Research Analysts are independent from
one another and their respective coverage of issuers are different. In addition, because they are independent from one another, Scotia Howard Weil Research Analysts and Scotiabank
Research Analysts may have different opinions on the short-term and long-term outlooks of local and global markets and economies.
This report was prepared for general circulation and does not provide investment recommendations specific to individual investors. As such, the financial instruments discussed in this
report may not be suitable for all investors and investors must make their own investment decisions based upon their specific investment objectives and financial situation utilizing their
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Past performance of the financial instruments recommended in this report should not be taken as an indication or guarantee of future results.
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Any prices that are stated in this report are for informational purposes only. Scotiabank, Global Banking and Markets makes no representation that any transaction may be or could
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The compensation of the research analyst who prepared this report is based on several factors, including but not limited to, the overall profitability of Scotiabank, Global Banking and
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Additional Disclaimers and Disclosures
Opinions expressed are subject to change without notice and do not take into account the particular investment objectives, financial situation or needs of individual investors.
Employees of Scotia Capital (USA) Inc. or its affiliates may, at times, release written or oral commentary, technical analysis or trading strategies that differ from the opinions expressed
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February 2, 2015
Page 23 of 23