CNX Resources Corporation CNX came into existence post the spin-off of CONSOL Energy (CONSOL). Natural gas has become the preferred choice for energy due to its clean burning nature.
Let us find out whether this natural gas focused company has the necessary fire power to gain from the increasing demand for natural gas and share benefits with investors.
Assets of the Company
This company’s operation is centered in the resource rich Appalachian Basin. Currently, the company has access to 6.3 trillion cubic feet equivalents (tcfe) of proved clean-burning natural gas reserves.
CNX Resources is among the leading natural gas operator in the Marcellus and Utica shales. The company controls more than 790,580 acres and operates 337 wells in the region.
Plans Ahead
CNX Resources’ low-cost structure and high-quality assets holding are expected to strengthen its position. The planned 2017 E&P capital expenditure is expected to range between $620 million and $645 million.
CNX Resources expects 2017 and 2018 E&P production in the range of 405-415 billion cubic feet equivalent (Bcfe) and 520-550 Bcfe, respectively. The company is expected to drill nine additional wells in 2017 and modify production protocol, which will boost production in 2018. Focus on Marcellus play will help the company produce higher natural gas volumes.
Management’s single point focus on natural gas business will help deliver stellar performance. In addition, the cost-savings initiatives will continue providing additional boost to the company’s margins.
Tough Competition
CNX Resources Corp. is a new entrant in the industry and competes with the major natural gas producers like Southwestern Energy Company SWN, Chesapeake Energy Corp. CHK and Anadarko Petroleum Corp. APC among others. These three stocks carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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