In its current operational update, upstream energy firm Matador Resources Company (MTDR) declared that it is planning to focus only on Permian Basin in 2015.
Presently, the company is operating a total of five rigs in the Permian Basin and Eagle Ford shale. However, following a weak oil and natural gas pricing environment, Matador Resources will likely operate three new build rigs − capable of performing drilling and completion activities simultaneously – in the Permian Basin.
Matador Resources added that once the commodity prices recover, it will again shift focus to its shale operations in Eagle Ford which has rich oil and gas reserves.
The company believes that the three state-of-the-art and new build rigs will considerably lower the drilling expenses in the Permian Basin. Matador Resources has already received delivery of one of the three rigs. Of the two units that are remaining, one will be received in a few days and the other will likely be delivered on Jul 1.
The operational update also mentions that the company estimates $325 million to $375 million capital investment during 2015. Matador Resources believes that this amount is optimal especially in the ongoing low commodity pricing scenario.
As per the previous release on Dec 8, 2014, during the final quarter of 2014, the company achieved record production levels on both oil and natural gas. Matador Resources is expected to report its total reserves − as of Dec 31, 2014 – along with its full-year production during its Analyst Day on Feb 5.
Dallas, TX-based Matador Resources, currently has a Zacks Rank #4 (Sell), implying that it will underperform the broader U.S. market in the next one to three months.
Meanwhile, better-ranked players in the energy sector include Enbridge Energy Management LLC (EEQ), Cheniere Energy Partners LP (CQP) and Seadrill Partners LLC (SDLP). All these stocks sport a Zacks Rank #1 (Strong Buy).
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