With the transfer of its assets in Ecuador to government-affiliated entities for a total sum of $97 million, Noble Energy Inc. (NBL) exited Ecuador. The net book value for these assets totaled $68 million.
Noble Energy received compensation for its offshore Amistad field assets and Block 3 production sharing contract, which was terminated by the Ecuadorian government on November 25, 2010. Also, the compensation included an amount for the assignment of the Machala Power Electricity concession and its associated assets. The company had 100% interest in these assets.
In a separate development, the company announced its continued drilling success in the deep water Gulf of Mexico aided by the discovery at its Santiago exploration prospect. Santiago is the third successful finding for Noble Energy in its Galapagos project, following prior successes at Santa Cruz and Isabela.
Noble Energy reported adjusted earnings per share of $1.35 for the first quarter of 2011, which surpassed the Zacks Consensus Estimate of $1.16 as well as the year-ago quarter's earnings of 78 cents per share. A 9% increase in sales volume largely aided the outperformance.
At its earnings conference call, the company guided its second-quarter 2011 volumes to average 208 to 218 MBoe/d. The company also guided its volumes from international operations to come in a little lower in the second quarter owing to planned downtime in the North Sea and Equatorial Guinea.
The Zacks Consensus Estimate for second-quarter 2011 is $1.27 per share. For full years 2011 and 2012, the Zacks Consensus Estimates are, $5.05 per share and $6.85 per share, respectively.
We maintain our Neutral rating on Noble Energy.The quantitative Zacks #3 Rank (short-term Hold rating) on the stock indicates no clear directional pressure on the shares over the near term.
Based in Houston, Texas, Noble Energy operates internationally and engages in the acquisition, exploration, development, production, and marketing of crude oil, natural gas and natural gas liquids. It competes with Anadarko Petroleum Corporation (APC).
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