Crescent Point Energy on Dec. 4 forecast lower capital spending and output in 2021, the latest oil producer to focus on conserving cash, as it prepares for low prices over a longer horizon.
Energy companies have cut spending aggressively in a race to offset weak trends in fuel demand caused by the COVID-19 pandemic, with U.S. oil major Chevron on Dec. 3 cutting billions off its long-term capital and exploratory budget.
However, Crescent Point’s reduction in output also comes at a time when Canadian oil companies are restoring output that they shut in, as prices recover from pandemic lows.
Crescent Point said it expects average production of 108,000 to 112,000 barrels of oil equivalent per day (boe/d) in the coming year, as pace of activity remains low.
The company, which focuses primarily on light oil production in southern Saskatchewan, said it expects capital expenditures of C$475 million to C$525 million (US$408.46 million) next year, with majority of the budget allocated to its key focus areas in Viewfield, Shaunavon and Flat Lake.
Scotiabank said Crescent’s 2021 capital program was meaningfully lower than consensus and it had a positive view of the defensive budget.
Its latest 2020 budget, revised multiple times due to the pandemic, was for capital expenditures of about C$665 million and production of up to 121,000 boe/d this year.
Crescent Point, however, expects excess cash flow of about C$150 to C$300 million in 2021 at U.S. West Texas Intermediate (WTI) in the range of $45/bbl to $50/bbl. It also plans to evaluate other opportunities including returning capital to shareholders as market conditions improve.
Recommended Reading
PGS Wins 3D Contract Offshore South Atlantic Margin
2024-04-08 - PGS said a Ramform Titan-class vessel is scheduled to commence mobilization in June.
TGS Starts Up Multiclient Wind, Metaocean North Sea Campaign
2024-05-07 - TGS is utilizing two laser imaging and ranging buoys to receive detailed wind measurements and metaocean data, with the goal of supporting decision-making in wind lease rounds in the German Bright.
Forum Energy Signs MOU to Develop Electric ROV Thrusters
2024-03-13 - The electric thrusters for ROV systems will undergo extensive tests by Forum Energy Technologies and SAFEEN Survey & Subsea Services.
Axis Energy Deploys Fully Electric Well Service Rig
2024-03-13 - Axis Energy Services’ EPIC RIG has the ability to run on grid power for reduced emissions and increased fuel flexibility.
TotalEnergies Rolling Out Copilot for Microsoft 365
2024-02-27 - TotalEnergies’ rollout is part of the company’s digital transformation and is intended to help employees solve problems more efficiently.