By Sarfaraz A. Khan
Summary: WPX
Energy is a natural gas -focused E&P company. The company has not reported
any meaningful increase in total production and has struggled with
profitability. That said, WPX Energy could change its fortune in the near
future.
WPX Energy
(NYSE:WPX) has struggled with profitability and production growth on the back
of a tough pricing environment in the natural gas market. But this could change
in the future on the back of increasing oil production in the near term and
higher gas production in the long term.
WPX Energy is
an independent natural gas focused exploration and production company formed
about two years ago from a spinoff of the pipeline operator Williams Cos
(NYSE:WMB). Since its birth, the natural gas prices have improved from less
than $3/MBtu in early 2012 to nearly $4/MBtu in mid-2014 but have largely
remained below $5/MBtu since 2011.
WPX Energy
has significant operations at Colorado's Piceance Basin, North Dakota's
Williston Basin in the larger Bakken formation and New Mexico's San Juan Basin.
No Production
Growth
WPX Energy
has not reported any meaningful increase in production over the last several
quarters. Since the beginning of 2013, the company's total output has hovered
between 1,230 mmcfe/d and 1,268 mmcfe/d.
WPX Energy's
gas production has fallen from 1,007 mmcf/d in Q2-2013 to 965 mmcf/d in
Q2-2014. However, the company's gas production from Piceance Basin has been
largely flat from last year. Amid the weak pricing environment in the natural
gas market, WPX Energy has turned towards oil. … read full article at Seeking Alpha.
