Lafayette-based PetroQuest Energy Inc.’s eased off a bit Tuesday from a 23 percent gain in its stock that came after the company sold most of its Midwest holdings for $280 million.
PetroQuest, like other energy firms, has endured a brutal 12 months. Plummeting oil prices dragged down the company’s shares from a high of $7.59 per share in July to a low of $1.73 in late May. PetroQuest closed Monday at $2.32 after the sale of its Midwest holdings, but drifted down to $2.25 in trading Tuesday.
The Woodford and Mississipian Lime assets it sold produced the equivalent of 46 million cubic feet of natural gas per day during the first quarter, according to PetroQuest.
The formations overlap in north-central Oklahoma and south-central Kansas. The Mississippian lies above the Woodford.
Wall Street analysts Raymond James upgraded PetroQuest to “outperform,” meaning PetroQuest’s returns are expected to be better than the S&P 500 over the next 12 to 18 months.
PetroQuest used the money from its sale of the Midwest holdings to repay all that it owed on its bank credit, which left the company with about $130 million in cash. PetroQuest also will collect $14 million in deferred sales proceeds by the end of the year.
PetroQuest’s lender reduced the company’s borrowing base to $70 million from $190 million. The borrowing base is the amount a company can borrow based on the value of collateral pledged. PetroQuest’s bank is scheduled to again assess the energy firm’s borrowing base around Sept. 1.
Meanwhile, PetroQuest said its Thunder Bayou facility in Vermilion Parish will be online this week. Daily production from the first well will be the equivalent of more than 38,000 cubic feet of gas.