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WPX Energy completes transition to crude producer

  • Märkte: Crude oil, LPG, Natural gas
  • 04.11.16

WPX Energy's transformation to an oil-focused producer is complete and the Oklahoma-based company is working to double oil output while continuing to reduce debt.

The company added a third drilling rig in Delaware basin of the Texas Permian in October, completed its first well on acreage acquired during the third quarter and plans to break ground on the first phase of a crude oil gathering system this month.

In the Williston basin, WPX resumed well completions in the prior quarter and added a second rig there late last month.

"Everything is in place to meet or exceed our objectives," said WPX chief executive officer Rick Muncrief.

Total third-quarter production volume rose by 16pc from a year ago to 84,400 b/d of oil equivalent (boe/d). The company's portfolio has shifted to 60pc crude and NGL production, up from 34pc in the same quarter of 2015. Natural gas production has fallen to 40pc from 66pc a year earlier.

WPX again raised its 2016 oil production guidance by 2pc to an average 40,000-42,000 b/d.

Next year, WPX said total production will average 97,000-107,000 boe/d, including 49,000-53,000 b/d of crude. The 2017 capital budget will range from $835mn-$905mn.

WPX produced 38,900 b/d of oil in the third quarter, up by 15pc from the year-earlier period, thanks to nearly 14,300 b/d from holdings acquired in 2015 from RKI Exploration.

WPX oil output from North Dakota's Williston basin fell by 9pc in the quarter and production from the San Juan basin in northern New Mexico slid by 31pc from the comparable 2015 quarter. Combined oil output fell 5pc from the second quarter.

Natural gas production grew by 11pc from the year-earlier quarter to 205mn cf/d, including 52mn cf/d from the Permian basin. Gas output from the San Juan basin fell by 5pc while output from the Williston basin rose by 10pc from the year-earlier period.

NGL production nearly jumped by 43pc to 11.4mn b/d from 2015, driven by the additional Permian acreage.

WPX said its weighted-average gross sales price for crude was $39.15/bl in the quarter, down from $39.66/bl a year ago. its price for gas decreased by 5pc to $2.44/1,000 cf and the average for NGLs rose 4pc to $14.92/bl.

For the remainder of 2016, WPX has 30,403 b/d hedged at $60.13/bl. WPX has gas hedges totaling 145mn cf/d at a weighted average price of $3.93/mmBtu for the rest of the year.

For 2017, WPX has 34,554 b/d of oil hedged at a weighted-average price of $51.45/bl and 170mn cf/d of gas hedged at $3.02/mmBtu.

Based on current commodity prices, WPX said it can fund drilling and completion activity and build its Delaware basin crude oil gathering system without adding debt through 2020.


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