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PDC Energy Incorporation Essay

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Introduction PDC Energy (PDCE) Incorporation is a private exploration and production company which distributes petroleum products where it focusses on exploring, development and the production of crude oil, natural gas, and natural gas liquids. It is a mid-size company employing over 400 people, which was incorporated in Bridgeport, West Virginia in 1969. Operating under the ticker PDCE, PDC Energy trades on the NASDAQ. As of today, it’s main operation is located in Wattenberg Field in Colorado and Utica Shale in southeastern Ohio. In the last five years, the company has conducted extensive effort to improve capital efficiency of the drilling programs by focusing on horizontal drillings. PDC Energy owns 341 million barrels of oil equivalent …show more content…

The trend seems to persist despite such positive boosts in the financial year 2015 and 2016. It’s shift in focusing to the Permian area basins has proven to be costly. As of YTD, its stock prices has reduced by 30%. One of the main challenges that PDC Energy must hold is balancing the volatility of the price of oil to its production costs. The price of oil had taken a strong hit as in 2014, it reached a high of over $100 and later, a low of $30. Though it has stabilized, other external factors such as the lift on embargo for Iranian oil impacts prices. Thus, the volatility will always pose as a challenge as it directly effects the cost of production and subsequently profits. Another challenge that PDC Energy must uptake is diversifying its region of operation. Since its primary location is located Colorado, PDC Energy is susceptible to weather changes, price inflation and demand within the area. Bottleneck from the production side has occurred in the past due to the concentration of its operation. The expansion of acquiring the Delaware Basin and the Prairie Area is an act of countermeasure that is expected to increase production

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