Bruce Jefferson
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Cabot Oil & Gas' Production Could Double In The Next 2 Years

Drexel Hamilton raised the price target on the shares of Cabot Oil & Gas Corporation  to $35 from $31, saying that its review of the firm's pipeline transport and sales additions indicate a strong likelihood that its Marcellus shale natural gas production could double over the next 24 months.

The brokerage expects Cabot's Marcellus shale production to rise from 1.6 Bcf/d currently to 3.9 Bcf/d by YE'18.

"Our estimates remain premised on $3.15 and $3.30/Mcf 2017 and 2018 average U.S. natural gas prices and anticipate improved "basis" differentials (lesser regional discounts) of -$0.60/Mcf '16; -$0.30/Mcf '17; -$0.20/Mcf in '18 because of these new outlets for its production," analyst Robert Christensen wrote in a note.

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