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November 2014

Sanchez Energy 3rd Quarter Report...Notes...

Posted by bernell on November 5, 2014

Very little came out in the question and answer session from the Sanchez Energy 3rd quarter presentation as it relates to the TMS.  However, what was mentioned was very relevant and encouraging.

Note that I missed most of the formal presentation, but the accompanying slides did not offer much input into the TMS.

During the Q&A session a caller asked about the drilling plans for 2015.  Previous communications had indicated Sanchez planned to keep a rig in the play until 6 more wells were completed (including the current well being drilled).  The impression was that the six wells were a part of a leasehold requirement. 

The answer given to this question was positive for the TMS, in my opinion. 

I'm going to paraphrase the answer, but as I heard the response, the company president said that the drilling obligations would likely be met by the end of the first quarter of 2015 and, in light of current oil prices and the emerging play status of the play, Sanchez Energy was only committing to drill until those requirements were satisfied.

He went on to add that once those obligations were met, they would reassess things.  The price of oil, their drilling success, and the drilling success of the other companies in the play would all be factors in what they would do from that point forward.

He concluded that, based on the results others have had thus far and depending upon the price of oil, things looked very encouraging for the play and the continued involvement on Sanchez.

What do you think about it?