Newfield Exploration (NYSE:NFX) Results from Eagle Ford Drilling

Newfield Exploration (NYSE:NFX) released the results of their drilling of 11 wells in the Eagle Ford shale.

FBR noted, "Last night, NFX reported results from 11 wells drilled in the Eagle Ford shale. The wells had initial production (IP) between 400 Boe/day and 900 Boe/day, implying estimated ultimate recoveries (EURs) in the range of 200 Mboe–400 Mboe. Importantly, about 70% of the 300,000 net acres the company holds in the Eagle Ford is in the deeper, higher-pressured southern portion, which exhibited IPs and EURs in the 700 Boe/d–900 Boe/d range, implying a 400+ MBoe EUR potential and 45% pretax IRR at $80/bbl. Without assigning any value to Newfield's northern acreage, we estimate its southern Eagle Ford position to be worth $2.7 billion or about $21/share. We note that because of the shallower depths of the Maverick Basin there was some concern in the marketplace that the whole Eagle Ford position is sub-optimal."

FBR Capital maintains an "Outperform" rating on Newfield Exploration, which was trading at $71.96, down $0.09, or 0.12 percent, as of 11:19 AM EST. FBR has as price target of $85 on Newmont.