Providing coverage of Alaska and northern Canada's oil and gas industry
June 2015

Vol. 1, No. 5 Week of June 14, 2015

Triangle sees $100 oil in near future claiming ‘something has to give’

Triangle Petroleum ended its first quarter of fiscal year 2016 on April 30 with 69 percent year-over-year production increase due to higher working interests. It raised production guidance to 11,500 to 13,500 barrels of oil equivalent per day, and may consider raising it again as the year progresses.

The Denver-based operator spudded 10 gross (7.3 net) operated wells and completed five gross (3.3 net) wells with two rigs during the quarter, and has plans to spud approximately 25 wells, and complete up to 29 wells with 1.5 operated rigs on average for fiscal year 2016. The company currently has 23 gross (18.7 net) wells being drilled or waiting on completion. During the first quarter, Triangle produced 13,775 boepd.

Subsidiary RockPile Energy Services marked a record number of completions at five for Triangle and 50 for third parties during the quarter with another 27 wells in backlog. RockPile brought in $80.6 million of standalone revenue during the quarter which was down 27 percent sequentially. The declining oil activity and increased competitiveness among service companies to maintain utilization has lowered revenue per share by more than 40 percent. But CEO Jon Samuels said the current outlook is improving for the first time in months.

“Broadly speaking, the rest of the global economy is healthy and growing,” he said. “Meanwhile, low oil prices have stimulated demand growth both here at home and overseas - you put it all together and something has to give. It’s just a question of what and when.”

Samuels predicts oil to reach $100 again and stay there “for some time.”

“Frankly, the longer oil stays down this year,” he told analysts on June 9, “the higher prices will have to be in 2016 and 2017 to meet rising global demand absent entering major economic changes and all other things being equal.”

- Maxine Herr

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