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by Stockwatch Business Reporter
West Texas Intermediate crude for March delivery gained 22 cents to $61.90 on the New York Merc, while Brent for April gained 41 cents to $65.25 (all figures in this para U.S.). Western Canadian Select traded at a discount of $28 to WTI ($33.90), up from a discount of $26.45. Natural gas for March gained six cents to $2.62. The TSX energy index gained a fraction to 173.64.
Many oil and gas producers enjoyed nice little rallies on this slow day for news. Crescent Point Energy Corp. (CPG) gained 28 cents to $9.09 on 3.8 million shares, Birchcliff Energy Ltd. (BIR) gained 11 cents to $3.18 on 3.12 million shares and Crew Energy Inc. (CR) gained five cents to $1.74 on 2.74 million shares.
Darren Gee's Peyto Exploration and Development Corp. (PEY), which gained 31 cents to $10.76 on 1.43 million shares, is a gas producer in Alberta's Deep basin. Like other Western Canadian gas producers, it has been suffering from volatile and generally declining AECO gas prices (the benchmark in Alberta). Some of those suffering gas producers, including the above-mentioned Crew Energy, are hoping to cope at least in part by boosting liquids production, but not Peyto. Mr. Gee, Peyto's president and chief executive officer, wrote in his latest monthly letter to shareholders, "Sure, we could be like everyone else, and when gas prices go south, we could chase liquids, but we also know that the cost of liquid production is much higher than gas." Peyto takes great pride in its low-cost operations. Nonetheless, when the company released its 2018 plans last week, it singled out its Greater Sundance Cardium play, where it hopes to find liquids yields between 19 and 26 per cent. For context, Peyto's liquids yield at the end of 2017 from all of its projects combined was just under 10 per cent. Besides the Cardium, Peyto's other projects are in the Wilrich, Notikewin, Falher andBluesky formations, all in Alberta's Deep basin. Peyto was producing a total of 115,000 barrels of oil equivalent a day at the end of 2017.
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