CRC California crude production

[Doyle Johnson + 14]

CRC took a big dip last week, just wondering why as most of its production is heavier API grade, a desirable commodity these days. In a fairly recent production report 51% of California crude oil has an average API of 18 degrees or less, and 48% has an average API between 18 and 36 degrees, compared to WTI at 39.6 degrees. Rationally, one would think when an asset  becomes more valuable it would be reflected in its stock price as CRC has about 600 MB of proven reserves. Do any of you more experienced in oil have a different take on CRC?

[Old-Ruffneck + 1,246]

4 hours ago, Doyle Johnson said:

CRC took a big dip last week, just wondering why as most of its production is heavier API grade, a desirable commodity these days. In a fairly recent production report 51% of California crude oil has an average API of 18 degrees or less, and 48% has an average API between 18 and 36 degrees, compared to WTI at 39.6 degrees. Rationally, one would think when an asset  becomes more valuable it would be reflected in its stock price as CRC has about 600 MB of proven reserves. Do any of you more experienced in oil have a different take on CRC?

Well for starters, heavy crude is steamed out of the ground. Expensive means of recovery. California is NOT a friendly state for most oil operations as too many would like to see oil disappear. Most of the big operators have moved on from California to more lucrative states. A lot of counties have outright banned Fracking and now their production levels in 4 years have dropped in half or little over. Here is an article that is little older but still rings true for the Oil Energy industry for California.

https://www.sandiegouniontribune.com/business/energy-green/sd-fi-california-crudeoil-20180711-story.html