Energy Summary for Feb. 23, 2018

by Stockwatch Business Reporter

West Texas Intermediate crude for April delivery gained 78 cents to $63.55 on the New York Merc, while Brent for April gained 92 cents to $67.31 (all figures in this para U.S.). Western Canadian Select traded at a discount of $28 to WTI ($35.55), unchanged. Natural gas for March lost one cent to $2.63. The TSX energy index gained 3.24 points to 177.03.

Alberta producer Obsidian Energy Ltd. (OBE) gained four cents to $1.27 on 715,900 shares, after boosting its reserves and appointing Jay Thornton as its chairman. First, the reserves boost: Obsidian's proved plus probable reserves were 131 million barrels of oil equivalent at year-end 2017, up from 128 million barrels at year-end 2016. Although the percentage increase is small, president and chief executive officer David French was delighted to point out that "2017 was the first time in five years we replaced produced reserves." Obsidian's full-year production in 2017 was 12 million barrels, and it managed to book more new reserves than that during the year, thanks in part to a recently added core area for the company, Alberta's Deep basin. Mr. French also gave partial credit for the reserves boost to the company's waterflooding program in the Alberta Cardium. Scotia Capital analyst Patrick Bryden is pleased by Obsidian's operations in the Deep basin and the Cardium. He looks forward to March 7, when the company will release its full-year financials. He maintains his rating of "sector perform" and his price target of $2. Meanwhile, Canaccord Genuity analyst Sam Roach is also pleased by the Cardium waterflooding program. He maintains his rating of "speculative buy" and his price target of $1.80.

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