Financial News for Independent Energy Companies, Second Quarter 2010

Release Date: September 21, 2010
Next Release Date: To Be Determined


  • The "Financial News for Independent Energy Companies" reviews the financial performance of companies that are typically smaller than the majors and do not have integrated production/refining operations.
  • While the composition of the companies in this report changes over time, the changes are usually incremental, and don't significantly affect comparisons across time periods.
  • All dollar figures and comparisons are in constant second-quarter 2010 dollars unless otherwise specified.
  • Ethanol producers were added to this report last quarter for the first time, and refiners have been dropped as they are covered in "Financial News for Major Energy Companies."
  • Contact:
    Bob Schmitt
    Fax:(202) 586 9573
Second Quarter 2010 Key Findings
Net Income: $3.4 billion Revenues: $28.4 billion
  • Independent energy companies (including oil and gas producers in addition to oilfield companies) reported a 77 percent increase in income in the second quarter of 2010 (Q210) to $3.4 billion.
  • Oil and gas producer revenues increased sharply along with crude and natural gas prices, and earnings rebounded from losses in Q209 to their highest second-quarter level in the 2005-2010 period.
  • Oilfield company revenue and earnings increased modestly in Q209 but remained well below the Q2 average over 2005-2010.
  • Ethanol producer revenues increased and earnings crossed into the black after losses in Q209.

Net Income for Independent Energy Companies:     (back to top)

  • Net income for oil and gas producers and oilfield companies combined, rebounded to $3.4 billion in the second quarter of 2010 (Q210) compared to $1.9 billion in Q209. This was driven by the large turnaround in oil and gas producer earnings, which reached their highest Q2 level over 2005-2010; this in turn was largely a result of the price increases in crude oil (28 percent) and natural gas (17 percent)
  • Oilfield company net income increased 12 percent from Q209, to $2.5 billion, but remained below the Q2 average over 2005-2009.

Revenues for Independent Energy Companies:     (back to top)

  • Q210 revenue for oil and gas producers and oilfield companies combined increased by 12.0 percent above year ago levels and was 8.3 percent above the second-quarter average over 2005-2009.
  • Oil and gas producer revenue increased 55 percent in Q210 from the year-ago quarter, to a level 47 percent above the second-quarter average over 2005-2009.
  • Oilfield company revenue increased 6.7 percent in Q210 to a level 3.5 percent above the second-quarter average over 2005-2009.

Ethanol Producer Second Quarter 2010 Revenue and Net Income:     (back to top)

  • Revenue and income for ethanol producers in this report both increased in Q210 from the year-ago quarter: revenue was up 4.9 percent to $1.2 billion in Q210, while net income went from losses of $12 million to earnings of $29 million in Q210.
  • This occurred despite a modest drop in ethanol prices in Q210 to $1.57 per gallon, as initial losses from start-up costs for many new ethanol companies began to diminish.

Supplemental Figures:     (back to top)

  • U.S. oil rig counts increased by 174 percent in Q210 over the year-ago quarter to an average of 536 rigs, while U.S. gas rig counts increased 31 percent to an average of 957 rigs.
  • The U.S. total rig count increased by 61 percent to 1,508 in Q210, pushing world totals to increase 38 percent.

  • Crude oil prices in Q210 were 28 percent higher than in Q209 and 3 percent higher than the average for the second quarter of 2005-2009 (in Q210 dollars).
  • Natural gas prices of Q210 were 17 percent higher than in Q209, but 41 percent lower than the second-quarter average for 2005-2009 (measured in Q210 dollars).

  • Ethanol prices dropped slightly in Q210 to their lowest second-quarter level over 2007-2010.

Supplemental Tables:     (back to top)

Table 1. Revenue and Net Income Summaries for Independent Energy Companies
Companies Q209 Q210 Percent
First Half
First Half
Revenue (Million Q210 Dollars)a   (Million Q210 Dollars)a  
Oil and Gas Producers (15)b 2,644 4,130 55.1 5,488 8,553 55.9
Oilfield Companies (17) 21,583 23,021 6.7 45,233 44,237 -2.2
Ethanol Producers (13) 1,182 1,240 4.9 2,372 2,591 9.2
    Total Revenue (45) 25,428 28,392 11.7 53,094 55,381 4.3
Net Income
Oil and Gas Producers (15) -313 869 377.4 -2,996 2,103 170.2
Oilfield Companies (17) 2,251 2,516 11.8 5,763 5,008 -13.1
Ethanol Producers (13) -12 29 354.2 -77 93 221.0
    Total Income (45) 1,927 3,415 77.2 2,690 7,204 167.8
a Values have been converted to constant Q210 dollars using the GDP price deflator series.
b The number of companies reporting revenue and net income is in parentheses.
Notes: Percentages are calculated from unrounded data.
Sources: Compiled from companies' quarterly reports to stockholders.
Table 2. U.S. Energy Prices
Q209 Q210 Percent
U.S. Energy Prices (Q210
    Imported Crude Oil Price ($/barrel)a 57.99 74.33 28.2
    Natural Gas Wellhead Price ($/thousand cubic feet)a 3.47 4.07 17.3
Ethanol Midcontinent Spot Price ($/barrel)b 1.72 1.57 -9.0
a Energy Information Administration, Short-Term Energy Outlook, (September 8, 2010), Table 2.
b Compiled from Reuters data.

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