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Abraxas Petroleum Corp. Reports Operating Results (10-K)
Posted by: gurufocus (IP Logged)
Date: March 16, 2011 05:26PM
Abraxas Petroleum Corp. (AXAS) filed Annual Report for the period ended 2010-12-31. Abraxas Petroleum Corp. has a market cap of $417.4 million; its shares were traded at around $4.72 with and P/S ratio of 7.9.
Highlight of Business Operations:
Information contained in this report represents the operations of Abraxas Petroleum Corporation and Abraxas Energy Partners, L.P., which we refer to as the Partnership, which are consolidated for financial reporting purposes. On October 5, 2009, Abraxas Petroleum Corporation acquired 100% ownership of the Partnership, which we refer to as the Merger. The non-controlling interest of the former limited partners of the Partnership is presented as non-controlling interest in the accompanying Consolidated Statement of Operations through the date that their interest was acquired by Abraxas. The terms “Abraxas,” “we,” “us,” “our,” or the “Company,” refer to Abraxas Petroleum Corporation, together with its consolidated subsidiaries including Abraxas Energy Partners, L.P., unless the context otherwise requires. Blue Eagle Energy, LLC (“Blue Eagle”) is a joint venture between us and Rock Oil Company, LLC (“Rock Oil”) to develop the Eagle Ford shale play in South Texas. We currently own an approximate 50% equity interest in Blue Eagle.
We are an independent energy company primarily engaged in the acquisition, exploitation, development and production of oil and gas in the United States and Canada. At December 31, 2010, our estimated net proved reserves were 26.6 MMBoe, (including our 50% equity interest in the proved reserves of Blue Eagle), of which 51% were classified as proved developed, 42% were oil and 83% were operated. Our daily net production for the year ended December 31, 2010 was 3,896 Boepd, of which 36% was oil or liquids.
Increasing the oil component of our production and proved reserves. By focusing our 2011 drilling activity in the oil and liquids-rich resource plays, we expect to increase the oil/liquids component of both our production and proved reserves. Our goal for 2011 is a 50/50 mix of oil/liquids and gas production, as compared to our 36/64 mix of oil/liquids and gas production for the year ended December 31, 2010. Our proved reserves at December 31, 2010 were 41% oil/liquids and 59% gas.
We have expanded our capital expenditure budget for 2011 to $60 million, an increase of approximately 66% over 2010. Approximately 50% of the expanded 2011 budget will be spent on unconventional horizontal oil wells in the Bakken/Three Forks and Niobrara plays in the Rocky Mountain region of the United States and the other 50% will target conventional oil plays in the Permian Basin and onshore Gulf Coast regions of the United States and in the province of Alberta, Canada. The 2011 capital expenditure budget is subject to change depending upon a number of factors, including the availability and costs of drilling and service equipment and crews, economic and industry conditions at the time of drilling, prevailing and anticipated prices for oil and gas, the availability of sufficient capital resources, the results of our exploitation efforts, and our ability to obtain permits for drilling locations.
Stocks Discussed: AXAS,