Latest Reports from the Oil & Gas Industry as Sanchez Energy and Rex Energy Rise Sharply

NEW YORK, NY / ACCESSWIRE / January 18, 2017 / Oil prices rose Tuesday on the back of a falling dollar and as comments made by Saudi Arabia signaled it would abide by the Organization of the Petroleum Exporting Countries’ (OPEC) production cuts. Light, sweet crude for February delivery increased $0.11 to close at $52.48 a barrel on the New York Mercantile Exchange. “Producing nations want to avoid a slump in prices,” Saudi Oil Minister Khalid al-Falih said to reporters in the United Arab Emirates. “What they command, they can still achieve.”

“The core OPEC members will work hard to hold the deal together until at least June, even if some members push the boundaries of compliance,” Helima Croft, head of commodities strategy at RBC Capital Markets, wrote in a note to clients.

Sanchez Energy Corp. (NYSE: SN)

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Sanchez Energy’s shares spiked 17.44 percent to close at $13.20 a share Tuesday. The stock traded between $11.40 and $13.68 on volume of 19.26 million shares traded. On January 12th, the company announced that the company and funds managed by Blackstone Energy Partners have entered a strategic 50/50 partnership to jointly acquire 318,000 gross acres in the Western Eagle Ford from Anadarko Petroleum Corp. for a total of approximately $2.3 billion resulting in acquisition of 155,000 net acres by each partner. Sanchez Energy held a conference call on Friday, January 13th to discuss the transaction. Sanchez Energy will fully fund its 50 percent share of the acquisition through a combination of cash on hand and commercial bank and preferred equity commitments at a newly formed non-recourse subsidiary.

“This accretive and transformative acquisition more than doubles our drilling inventory, adds 132 high rate of return DUCs, increases Sanchez Energy’s resource potential by over 550 MMBoe and provides a path for strong growth within projected cash flow,” said Tony Sanchez, III, Chief Executive Officer of Sanchez Energy, in the news release.

Rex Energy Corporation (NASDAQ: REXX)

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Rex Energy’s shares surged 44.18 percent to close at $0.745 a share Tuesday. The stock traded between $0.54 and $0.88 on volume of 22.71 million shares traded. On Tuesday, the company released a two-year financial and operational plan and a financial update. Average daily production is estimated to be in the range of 194.0 – 204.0 MMcfe/d in 2017, an increase of roughly 5 percent to 10 percent when compared to the company’s full-year 2016 production guidance.

“Rex Energy’s two-year plan is a clear, transparent road map for our future operation strategy. We designed the plan to enhance cash flow, provide strong production growth, and significantly reduce the company’s overall debt metrics – all while living within cash flow,” said Tom Stabley, President and CEO of Rex Energy. “The plan builds on the success of our 2016 initiatives; with the quality of our acreage, and strong support from our partners and dedicated employees, we’re confident we can deliver.”

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