Concho Resources SWOT Analysis, USP & Competitors

Posted in Energy, Total Reads: 696
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SWOT Analysis of Concho Resources with USP, Competition, STP (Segmentation, Targeting, Positioning) - Marketing Analysis

Concho Resources

Parent Company

Concho Resources

Category

Oil and Gas

Sector

Energy

Tagline/ Slogan

-

USP

Enhance stockholder value through profitably increasing reserves, production and cash flow

STP

Segment

Enterprises with energy requirements

Target Group

Entities which require oil and gas

Positioning

An independent oil and natural gas company engaged in the acquisition, development, and exploration of oil and natural gas properties

SWOT Analysis

Strengths

1. Its increasing oil and gas reserves  and its gas reserves have increased, which show its strength
2. Its significant drilling inventory proves to be time-efficient thereby increasing the production of crude oil and natural gas, thus playing a significant part of the growth strategy for Concho.
3. A strong growth in revenue and profits reflects the financial stability of Concho, which could be leveraged to fund growth plans in the future
4. Acquisition of acreage in the Delaware Basin from multiple parties for aggregate consideration that are strategically positioned in both the northern and southern portions of the company's Delaware Basin Bone Spring play
5. Robust oil production rates in the Permian Basin area where its operations are mainly concentrated, help it increase productivity and gain profits

Weaknesses

1. Geographic concentration in the US , and to a few all-encompassing assets (as the Yeso formation, which includes both the Paddock and Blinebry intervals, and the Wolfberry play in West Texas)exposes it more to risks local to the country and puts it at a disadvantageous position as regards its competitors
2. Over dependence on a limited number of customers can lead to adverse impacts on it in case of loss of either of these purchasers

Opportunities

1. Concho has planned for significant drilling activities which would increase production capacity of the company, thereby helping in the future growth of the company.
2. A forecasted increase in demand for natural gas and liquid fuels in the US provides an opportunity for the company to increase its top-line growth
3. Strategic acquisitions (in the Wolfberry trend in the Permian Basin, and inthe oil and natural gas assets of Three Rivers and certain affiliated entities) significantly expand Concho’s acreage in strategic plays and also complement its existing portfolio

Threats

1. Stringent laws and environmental regulations imposed by its home country would raise its capital costs and lead to declining profit
2. Intense competition from other players in the market, which have a larger asset base and more spread geographically, can lead to erosion in its market share
3. Volatility in oil and fuel prices, coupled with economic turmoil in Europe can hamper its operations and lead to losses

Competition

Competitors

1. ConocoPhillips
2. Exxon Mobil Corporation
3. Marathon Petroleum Company
4. Chevron Corporation

 


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