Project: Cana and STACK Expansion (CaSE) Phase I
Firm Commitment: 45,000 Dth/d
Project: Cana and STACK Expansion (CaSE) Phase II
Firm Commitment: 160,000 Dth/d
COST: 5.5 $B
VOLUMES: 199 MBOE/d
ACRES: 360000 Acres
COST: 380 $MM
VOLUMES: 12.7 MBOE/d
COST: 470 $MM
VOLUMES: 3.8 MBOE/d
ACRES: 42000 Acres
THE WOODLANDS, Texas, Nov. 12, 2018 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today provided a slide deck with supplemental information regarding its previously announced combination with Encana Corporation. The slides can be found on the Company's website at http://www.newfield.com.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale, liquids-rich resource plays in the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. In addition, we have a producing oil field offshore China.
Forward-Looking Statements
This communication includes certain statements that constitutes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Newfield Exploration Company (the "Company") to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Statements preceded by, followed by or that otherwise include the words "believes," "expects," "anticipates," "intends," "projects," "estimates," "plans," "may increase," "may fluctuate," "will," "should," "would," "may" and "could" or similar words or expressions are generally forward-looking in nature and not historical facts. Any statements that refer to outlook, expectations or other characterizations of future events, circumstances or results are also forward-looking statements. Important risks, assumptions and other important factors that could cause future results to differ materially from those expressed in the forward-looking statements are specified in Newfield Exploration Company's Annual Report on Form 10-K for the year ended December 31, 2017 and its Quarterly Reports on Form 10-Q for any subsequent periods under headings such as "Forward-Looking Statements", "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" and in other filings and furnishings made by the Company with the Securities and Exchange Commission from time to time. The Company undertakes no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events.
Important Additional Information Regarding the Transaction Will Be Filed With the SEC
In connection with the proposed transaction, Encana Corporation ("Encana") will file a registration on Form S-4 that will include a joint proxy statement of the Company and Encana. The definitive joint proxy statement/prospectus will be sent to the stockholders of the Company and Encana. Encana and the Company may also file other documents with the SEC regarding the proposed transaction. INVESTORS AND SECURITY HOLDERS OF THE COMPANY ARE ADVISED TO CAREFULLY READ THE JOINT PROXY STATEMENT AND ANY REGISTRATION STATEMENT/PROSPECTUS (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS THERETO) WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE TRANSACTION, THE PARTIES TO THE TRANSACTION AND THE RISKS ASSOCIATED WITH THE TRANSACTION. A definitive joint proxy statement and any registration statement/prospectus, as applicable, will be sent to security holders of the Company in connection with the Company's shareholder meetings. Investors and security holders may obtain a free copy of the joint proxy statement (when available), any registration statement/prospectus, and other relevant documents filed by the Company with the Securities and Exchange Commission ("SEC") from the SEC's website at www.sec.gov. Security holders and other interested parties will also be able to obtain, without charge, a copy of the joint proxy statement, any registration statement/prospectus, and other relevant documents (when available) by directing a request by mail or telephone to Investor Relations, Newfield Exploration Company, 4 Waterway Square Place, Suite 100, The Woodlands, Texas 77380. Copies of the documents filed by the Company with the SEC will be available free of charge on the Company's website at ir.newfield.com.
Participants in the Solicitation
The Company and its directors, executive officers and certain other members of management may be deemed to be participants in the solicitation of proxies from its security holders with respect to the transaction. Information about these persons is set forth in the Company's proxy statement relating to its 2018 Annual Meeting of Stockholders, as filed with the SEC on March 29, 2018 and subsequent statements of changes in beneficial ownership on file with the SEC. Security holders and investors may obtain additional information regarding the interests of such persons, which may be different than those of the Company's security holders generally, by reading the joint proxy statement, any registration statement and other relevant documents regarding the transaction, which will be filed with the SEC.
No Offer or Solicitation
This document is not intended to and does not constitute an offer to sell or the solicitation of an offer to subscribe for or buy or an invitation to purchase or subscribe for any securities or the solicitation of any vote in any jurisdiction pursuant to the proposed transaction or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law. Subject to certain exceptions to be approved by the relevant regulators or certain facts to be ascertained, the public offer will not be made directly or indirectly, in or into any jurisdiction where to do so would constitute a violation of the laws of such jurisdiction, or by use of the mails or by any means or instrumentality (including without limitation, facsimile transmission, telephone and the internet) of interstate or foreign commerce, or any facility of a national securities exchange, of any such jurisdiction.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5182
Email: IR@newfield.com
View original content:http://www.prnewswire.com/news-releases/newfield-exploration-provides-supplemental-information-regarding-its-strategic-combination-with-encana-corporation-300748252.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Oct. 31, 2018 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today announced third quarter 2018 unaudited financial and operating results.
Newfield plans to host a conference call at 9:00 a.m. CDT on November 1, 2018. To listen to the call, please visit Newfield's website at http://www.newfield.com. To participate in the call, dial 334-323-0522 and provide conference code 6919104 at least 10 minutes prior to the scheduled start time.
Third Quarter 2018 Highlights
The table below provides third quarter 2018 basin-level production, expenses, capital investments and operations results.
Anadarko | Williston | Uinta | Arkoma | ||||
PRODUCTION | |||||||
Oil (mbopd) | 43.2 | 14.6 | 16.3 | — | |||
NGL (mbbls/d) | 43.7 | 3.2 | 0.7 | 0.3 | |||
Gas (mmcfpd) | 341.2 | 21.1 | 16.0 | 80.7 | |||
Total (mboepd) | 143.7 | 21.4 | 19.7 | 13.8 | |||
EXPENSES ($/BOE) | |||||||
LOE1 | $2.04 | $6.61 | $9.25 | $3.19 | |||
Transportation2 | $4.61 | $5.97 | $1.48 | $4.51 | |||
Production & other taxes | $1.76 | $4.47 | $2.81 | $0.79 | |||
Total Expenses | $8.41 | $17.05 | $13.54 | $8.49 | |||
CAPEX ($MM) | |||||||
Drilling & Completion | $275 | $39 | $32 | — | |||
Other | $6 | $1 | $4 | $1 | |||
Total CAPEX3 | $281 | $40 | $36 | $1 | |||
OPERATIONS | |||||||
Operated rigs | 11 | 1 | 1 | — | |||
Op. wells placed on production (WI%/NRI%) | 39 | 6 | 5 | NA | |||
Op. wells placed on production (Average GPI) | 8,141' | 10,138' | 9,795' | NA |
1 | LOE includes other operating expenses. |
2 | Transportation excludes $9 million of firm gas transportation fees in Oklahoma. Third quarter 2018 shortfall fees in the Uinta Basin were $2 million. |
3 | CAPEX excludes $7 million associated with Corporate FF&E. |
Third Quarter 2018 Financial Summary
For the third quarter, net income was $224 million, or $1.11 per diluted share (all per share amounts are on a diluted basis). Earnings were impacted by an unrealized derivative gain of $20 million, or $0.10 per share. After adjusting for the effects of the unrealized derivative gain, net income would have been $204 million, or $1.01 per share. See the "Explanation and Reconciliation of Non-GAAP Financial Measures" at the end of this press release for additional disclosures.
Revenues for the third quarter were $711 million. Net cash provided by operating activities was $349 million and discretionary cash flow from operations was $373 million. See the "Explanation and Reconciliation of Non-GAAP Financial Measures" at the end of this news release for additional disclosures.
2018 Production and Capital Investment Outlook
Newfield today increased its expectations for annual net production and capital investments in 2018. Newfield now expects to invest approximately $1.4 billion in 2018 (previous guidance was $1.35 billion), excluding capitalized interest and overhead costs of about $120 million. The increase in planned full-year 2018 capital investments is primarily related to accelerated completions in the Anadarko Basin and the continuation of its operated rig in the Uinta Basin through year-end 2018.
The table below updates 2018 production and capital outlooks for Domestic, and more specifically, the Anadarko Basin.
2018E Actual and Estimated Quarterly Guidance1
DOMESTIC GUIDANCE | 1Q18 | 2Q18 | 3Q18 | 3Q18 | 4Q18E2 | FY18E |
PRODUCTION | ||||||
Oil (mbopd) | 72 | 74 | 73-77 | 74 | 73-77 | 74 |
NGL (mbbls/d) | 35 | 43 | 40-46 | 48 | 42-46 | 42 |
Gas (mmcfpd) | 401 | 422 | 420-450 | 462 | 420-450 | 430 |
Total (mboepd) | 174 | 187 | 185-195 | 199 | 185-200 | 185-190 |
CAPEX ($MM) | $345 | $365 | $365 | $364 | $325 | $1,400 |
ANADARKO GUIDANCE | ||||||
PRODUCTION | ||||||
Oil (mbopd) | 40 | 42 | 42-44 | 43 | 42-44 | 42 |
NGL (mbbls/d) | 31 | 38 | 36-40 | 44 | 38-42 | 38 |
Gas (mmcfpd) | 279 | 304 | 310-330 | 341 | 310-340 | 315 |
Total (mboepd) | 117 | 131 | 130-140 | 144 | 130-145 | 130-135 |
CAPEX ($MM) | $282 | $291 | $265 | $281 | $255 | $1,110 |
China Production (mboepd) | 3 | 9 | 2-3 | 3 | 1-3 | 3-5 |
1 | Production and capital are expected to be within 5% of the estimates above. |
2 | Individual product guidance ranges do not necessarily sum to total production guidance range. |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids (NGLs). Our U.S. operations are onshore and focus primarily on large scale, liquids-rich resource plays in the Anadarko Basin of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. In addition, we have oil assets offshore China, and gas assets in the Arkoma Basin of Oklahoma.
**This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Examples include discussions as to our expectations, beliefs, plans, goals, objectives and future financial or other performance. These statements, by their nature, involve estimates, projections, forecasts and uncertainties that could cause actual results or outcomes to differ substantially from those expressed in the forward-looking statements. The words "may," "forecast," "outlook," "could," "budget," "objectives," "strategy," "believe," "expect," "anticipate," "intend," "estimate," "project," "prospective," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets and expected production mix, estimated future operating costs and other expenses and other financial measures, estimated future tax rates, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although, as of the date of this release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks, some of which are beyond Newfield's control and are difficult to predict. No assurance can be given that such expectations will prove to have been correct. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, changes in commodity mix, accessibility to economic transportation modes and processing facilities, our liquidity and the availability of capital resources, operating risks, industry conditions, U.S. and China governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other oilfield services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, new regulations or changes in tax or environmental legislation, environmental liabilities not covered by indemnity or insurance, legislation or regulatory initiatives intended to address seismic activity, and other operating risks. Please see Newfield's 2017 Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other subsequent public filings, all filed with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed in this press release or in Newfield's SEC filings could also have material adverse effects on Newfield's actual results as compared to its anticipated results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this release and are not guarantees of performance. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5182
Email: IR@newfield.com
3Q18 Actual Results | |||||||||||
Domestic | China | Total | |||||||||
Production/Liftings(1) | |||||||||||
Crude oil and condensate (MBbls) | 6,839 | 261 | 7,100 | ||||||||
Natural gas (Bcf) | 42.5 | — | 42.5 | ||||||||
NGLs (MBbls) | 4,410 | — | 4,410 | ||||||||
Total (MBOE) | 18,332 | 261 | 18,593 | ||||||||
Average Realized Prices(2) | |||||||||||
Crude oil and condensate (per Bbl) | $ | 66.01 | $ | 71.97 | $ | 66.22 | |||||
Natural gas (per Mcf) | 2.34 | — | 2.34 | ||||||||
NGLs (per Bbl) | 31.73 | — | 31.73 | ||||||||
Crude oil equivalent (per BOE) | $ | 37.68 | $ | 71.97 | $ | 38.16 |
Domestic | China | Total | Domestic | China | Total | ||||||||||||||||||
Selected Expenses: | (In millions) | (Per BOE) | |||||||||||||||||||||
Lease operating | $ | 60 | $ | 6 | $ | 66 | $ | 3.29 | $ | 20.90 | $ | 3.54 | |||||||||||
Transportation and processing | 92 | — | 92 | 5.03 | — | 4.96 | |||||||||||||||||
Production and other taxes | 38 | 1 | 39 | 2.08 | 1.71 | 2.08 | |||||||||||||||||
General and administrative, net(3) | 53 | 1 | 54 | 2.88 | 4.75 | 2.90 | |||||||||||||||||
Other operating expenses (income), net | 2 | — | 2 | 0.12 | — | 0.12 | |||||||||||||||||
Interest expense | 38 | 2.03 | |||||||||||||||||||||
Capitalized Interest | (15) | (0.80) | |||||||||||||||||||||
Other non-operating (income) expense | (3) | (0.14) |
(1) | Represents volumes lifted and sold regardless of when produced. | |||||||||||||||
(2) | Average realized prices including the effects of derivative contracts for our domestic and consolidated crude oil and condensate were $54.98 per barrel and $55.60 per barrel, respectively. The average realized price including the effects of derivative contracts for domestic natural gas were $2.39 per Mcf and the average realized price for domestic NGLs would have been $30.95 per barrel. We did not have any derivative contracts associated with our China production as of September 30, 2018. | |||||||||||||||
(3) | Net general and administrative expenses excludes $15 million, or $0.79 per BOE, of capitalized direct internal costs. |
CONDENSED CONSOLIDATED BALANCE SHEET | |||||||
(Unaudited, in millions) | |||||||
September 30, | December 31, | ||||||
2018 | 2017 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 264 | $ | 326 | |||
Derivative assets | — | 15 | |||||
Other current assets | 493 | 405 | |||||
Total current assets | 757 | 746 | |||||
Oil and gas properties, net (full cost method) | 4,634 | 3,931 | |||||
Restricted cash | 47 | 40 | |||||
Other assets | 238 | 244 | |||||
Total assets | $ | 5,676 | $ | 4,961 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: | |||||||
Derivative liabilities | $ | 221 | $ | 98 | |||
Other current liabilities | 830 | 720 | |||||
Total current liabilities | 1,051 | 818 | |||||
Other liabilities | 67 | 69 | |||||
Derivative liabilities | 24 | 26 | |||||
Long-term debt | 2,436 | 2,434 | |||||
Asset retirement obligations | 135 | 130 | |||||
Deferred taxes | 92 | 76 | |||||
Total long-term liabilities | 2,754 | 2,735 | |||||
Stockholders' equity: | |||||||
Common stock, treasury stock and additional paid-in capital | 3,281 | 3,246 | |||||
Accumulated other comprehensive income (loss) | (1) | — | |||||
Retained earnings (deficit) | (1,409) | (1,838) | |||||
Total stockholders' equity | 1,871 | 1,408 | |||||
Total liabilities and stockholders' equity | $ | 5,676 | $ | 4,961 |
CONSOLIDATED STATEMENT OF OPERATIONS | |||||||||||||||
(Unaudited, in millions, except per share data) | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Oil, gas and NGL revenues | 709 | 439 | 1,965 | 1,257 | |||||||||||
Other revenues | 2 | 0 | 5 | 1 | |||||||||||
Total revenues | $ | 711 | $ | 439 | $ | 1,970 | $ | 1,258 | |||||||
Operating expenses: | |||||||||||||||
Lease operating | 66 | 53 | 197 | 167 | |||||||||||
Transportation and processing | 92 | 80 | 253 | 223 | |||||||||||
Production and other taxes | 39 | 16 | 90 | 43 | |||||||||||
Depreciation, depletion and amortization | 163 | 124 | 447 | 340 | |||||||||||
General and administrative | 54 | 53 | 159 | 151 | |||||||||||
Other | 2 | 1 | (3) | 2 | |||||||||||
Total operating expenses | 416 | 327 | 1,143 | 926 | |||||||||||
Income (loss) from operations | 295 | 112 | 827 | 332 | |||||||||||
Other income (expense): | |||||||||||||||
Interest expense | (38) | (37) | (113) | (112) | |||||||||||
Capitalized interest | 15 | 15 | 45 | 46 | |||||||||||
Commodity derivative income (expense) | (57) | (23) | (313) | 58 | |||||||||||
Other, net | 3 | 1 | 4 | 5 | |||||||||||
Total other income (expense) | (77) | (44) | (377) | (3) | |||||||||||
Income (loss) before income taxes | 218 | 68 | 450 | 329 | |||||||||||
Income tax provision (benefit) | (6) | (19) | 21 | (3) | |||||||||||
Net income (loss) | $ | 224 | $ | 87 | $ | 429 | $ | 332 | |||||||
Earnings (loss) per share: | |||||||||||||||
Basic | $ | 1.12 | $ | 0.44 | $ | 2.15 | $ | 1.67 | |||||||
Diluted | $ | 1.11 | $ | 0.44 | $ | 2.14 | $ | 1.66 | |||||||
Weighted-average number of shares outstanding for basic earnings (loss) per share | 200 | 199 | 200 | 199 | |||||||||||
Weighted-average number of shares outstanding for diluted earnings (loss) per share | 201 | 200 | 201 | 200 |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | |||||||
(Unaudited, in millions) | |||||||
Nine Months Ended | |||||||
September 30, | |||||||
2018 | 2017 | ||||||
Cash flows from operating activities: | |||||||
Net income (loss) | $ | 429 | $ | 332 | |||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||
Depreciation, depletion and amortization | 447 | 340 | |||||
Deferred tax provision (benefit) | 16 | 25 | |||||
Stock-based compensation | 34 | 25 | |||||
Unrealized (gain) loss on derivative contracts | 137 | (12) | |||||
Other, net | 7 | 10 | |||||
1,070 | 720 | ||||||
Changes in operating assets and liabilities | 27 | (69) | |||||
Net cash provided by (used in) operating activities | 1,097 | 651 | |||||
Cash flows from investing activities: | |||||||
Additions to and acquisitions of oil and gas properties and other | (1,164) | (828) | |||||
Proceeds from sales of oil and gas properties | 33 | 74 | |||||
Net cash provided by (used in) investing activities | (1,131) | (754) | |||||
Cash flows from financing activities: | |||||||
Debt issue costs | (8) | — | |||||
Other, net | (13) | (13) | |||||
Net cash provided by (used in) financing activities | (21) | (13) | |||||
Net increase (decrease) in cash, cash equivalents and restricted cash | (55) | (116) | |||||
Cash, cash equivalents and restricted cash, beginning of period | $ | 366 | $ | 580 | |||
Cash, cash equivalents and restricted cash, end of period | $ | 311 | $ | 464 |
Explanation and Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Earnings Stated Without the Effect of Certain Items)
Earnings stated without the effect of certain items is a non-GAAP financial measure. Earnings without the effect of these items are presented because they affect the comparability of operating results from period to period. In addition, earnings without the effect of these items are more comparable to earnings estimates provided by securities analysts. This measure should not be considered an alternative to net income (loss) as defined by generally accepted accounting principles (GAAP). A reconciliation of earnings for the third quarter of 2018 stated without the effect of certain items to net income (loss) is shown below (in millions, except per share data):
3Q18 | |||||||
(In millions) | (Per diluted share) | ||||||
Net Income (loss) | $ | 224 | $ | 1.11 | |||
Unrealized (gain) loss on derivative contracts | (20) | (0.10) | |||||
Earnings stated without the effect of the above items | $ | 204 | $ | 1.01 | |||
Weighted-average number of shares outstanding for per diluted share | 201 |
Discretionary Cash Flow from Operations
Discretionary cash flow from operations represents net cash provided by operating activities before changes in operating assets and liabilities and is presented because of its acceptance as an indicator of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur additional debt. This measure should not be considered an alternative to net cash provided by operating activities as defined by GAAP. A reconciliation of net cash provided by operating activities to discretionary cash flow from operations is shown below:
3Q18 | |||
(In millions) | |||
Net cash provided by operating activities | $ | 349 | |
Net changes in operating assets and liabilities | 24 | ||
Discretionary cash flow from operations | $ | 373 |
Net Debt to Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
EBITDA is determined by subtracting interest, income tax provision, and DD&A from net income. Adjusted EBITDA, a non-GAAP measure, further subtracts out non-cash items related to impairments, stock based compensation, derivative gain or loss, and other permitted adjustments. Adjusted EBITDA should not be considered an alternative to net income, as defined by GAAP. A reconciliation of net income to EBITDA, and to adjusted EBITDA, is shown below. Net debt is defined as long-term debt less cash and cash equivalents.
QTD | Twelve Months Ended | ||||||||||||||||||
4Q17 | 1Q18 | 2Q18 | 3Q18 | September 30, 2018 | |||||||||||||||
(In millions) | |||||||||||||||||||
Net Income | $ | 95 | $ | 86 | $ | 119 | $ | 224 | $ | 524 | |||||||||
Adjustments to derive EBITDA: | |||||||||||||||||||
Interest expense, net of capitalized interest | 23 | 23 | 22 | 23 | 91 | ||||||||||||||
Income tax provision (benefit) | (38) | 13 | 14 | (6) | (17) | ||||||||||||||
Depreciation, depletion and amortization (DD&A) | 127 | 133 | 151 | 163 | 573 | ||||||||||||||
EBITDA | $ | 207 | $ | 255 | $ | 306 | $ | 403 | 1,171 | ||||||||||
Adjustments to EBITDA: | |||||||||||||||||||
Non-cash stock based compensation | 9 | 9 | 16 | 9 | 43 | ||||||||||||||
Unrealized (gain) loss on commodity derivatives | 95 | 79 | 78 | (20) | 232 | ||||||||||||||
Other permitted adjustments | 3 | 1 | (6) | 1 | (1) | ||||||||||||||
Adjusted EBITDA | $ | 314 | $ | 344 | $ | 394 | $ | 393 | $ | 1,445 | |||||||||
Long-term debt | $ | 2,436 | |||||||||||||||||
Less: Cash | 264 | ||||||||||||||||||
Net debt | $ | 2,172 | |||||||||||||||||
Net debt / Adjusted EBITDA | 1.5 |
Note: Certain sections of this table do not foot or cross-foot for rounding purposes. |
View original content:http://www.prnewswire.com/news-releases/newfield-exploration-reports-third-quarter-2018-results-300741627.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Oct. 12, 2018 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) plans to host its third quarter 2018 earnings conference call at 9:00 a.m. (CDT), Thursday, November 1, 2018. The Company plans to release its third quarter earnings after market close on October 31, 2018.
To participate in the conference call, please dial 1(334) 323-0522 and provide conference code 6919104 at least 10 minutes prior to the scheduled start time. In addition, a listen-only broadcast of the call will be provided over the internet at http://www.newfield.com, under Investor Relations.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have producing oil assets offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5182
Email: IR@newfield.com
View original content:http://www.prnewswire.com/news-releases/newfield-provides-third-quarter-2018-conference-call-information-300729962.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Sept. 12, 2018 /PRNewswire/ -- Newfield Exploration Company's (NYSE: NFX) charitable foundation today announced it had awarded a grant in the amount of $30,000 to the National Wild Turkey Federation (NWTF) to improve grassland bird habitat in Oklahoma.
Implemented in partnership with the Oklahoma Department of Wildlife Conservation through the Oaks and Prairies Joint Venture (OPJV), the program will help boost song- and gamebird species in southern Oklahoma by reducing invasive plants that prevent the growth of native grassland habitat. The project also will enhance pollinator habitat for insects such as butterflies and bees.
Northern bobwhites, other grassland birds, Monarch butterflies and Rio Grande wild turkeys are among the varieties that will benefit from the restoration efforts. With proper management, the oak savannah and prairie habitats in south central Oklahoma supports and enhances a beneficial number of wild turkeys.
The OPJV Grassland Restoration Incentive Program (GRIP) is a voluntary private landowner financial incentive with the objective of encouraging land management practices that address greatest limiting factors for suitable grassland bird habitat.
"Since our inception nearly 30 years ago, Newfield has focused on being a good steward of the environment in the communities where we operate," said Lee K. Boothby, Newfield chairman, president and CEO. "Our support of the National Wild Turkey Federation will help to ensure the continued existence of native birds, animals, butterflies and other insects that have a beneficial impact on the natural Oklahoma habitat."
In 2018, the Newfield Foundation awarded more than $1 million in charitable grants to worthy projects in Oklahoma and other states where Newfield operates.
To reinforce its mission, the Newfield Foundation supports programs in the environment, medical, cultural arts and community services. Receiving grants this year in Oklahoma were eight community service charities, three environmental organizations and one medical foundation.
In 2018, The Newfield Foundation, which is employee-driven with charities nominated by employees, awarded grants totaling $1,002,500 to local organizations in Oklahoma, Utah, North Dakota and Texas. Newfield employees are encouraged to contribute a portion of their time, talent and personal resources to help where it matters most and to nominate local charities for further consideration by the Newfield Foundation.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on liquids-rich U.S. resource plays and our principal areas of operation include Oklahoma, Utah and North Dakota. We also have offshore oil production in China.
For additional information, please contact Newfield's Communications department.
Phone: 281-210-5253
Email: chassler@newfield.com
View original content:http://www.prnewswire.com/news-releases/newfield-explorations-foundation-contributes-30-000-to-the-national-wild-turkey-federation-300710729.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, July 31, 2018 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today announced second quarter 2018 unaudited financial and operating results. Additional details can be found in the Company's @NFX publication, located on its website http://www.newfield.com.
Newfield plans to host a conference call at 7:30 a.m. CDT on August 1, 2018. To listen to the call, please visit Newfield's website at http://www.newfield.com. To participate in the call, dial 323-794-2094 and provide conference code 1873319 at least 10 minutes prior to the scheduled start time.
Second Quarter 2018 Highlights
Second Quarter 2018 Financial and Production Summary
For the second quarter, the Company recorded net income of $119 million, or $0.59 per diluted share (all per share amounts are on a diluted basis). Earnings were impacted by an unrealized derivative loss of $78 million, or $0.39 per share, and a gain from a favorable legal settlement of $8 million, or $0.04 per share. After adjusting for the effects of the unrealized derivative loss and legal settlement during the period, net income would have been $189 million, or $0.94 per share. See the "Explanation and Reconciliation of Non-GAAP Financial Measures" at the end of this press release for additional disclosures.
Revenues for the second quarter were $679 million. Net cash provided by operating activities was $488 million. Discretionary cash flow from operations was $376 million. See the "Explanation and Reconciliation of Non-GAAP Financial Measures" at the end of this press release for additional disclosures.
Newfield's consolidated net production in the second quarter of 2018 was approximately 195,300 BOEPD, comprised of 42% oil, 22% natural gas liquids and 36% natural gas. Domestic net production in the same quarter was approximately 186,700 BOEPD, comprised of 39% oil, 23% natural gas liquids and 38% natural gas.
2018 Production and Capital Investment Outlook
Newfield today increased it's expectations for annual production volumes and capital investments in 2018. The table below updates guidance for production by commodity and planned capital investments for the Company's Domestic and Anadarko Basin assets. Newfield now expects to invest approximately $1.35 billion in 2018 (previous guidance was $1.3 billion), excluding capitalized interest overhead costs of about $114 million. The increase in estimated capital investments for 2018 is primarily related to greater participation in projects operated by others as well as increased working interest levels in its operated developments year-to-date.
In the table below, the Company provides an updated 2018 production and capital outlook for Domestic, and more specifically, the Anadarko Basin. Cost and expense guidance for the year can be found in the Company's @NFX presentation.
2018E Quarterly Guidance1
DOMESTIC GUIDANCE |
1Q18 Actual |
2Q18 Guidance |
2Q18 Actual |
3Q18E2 |
4Q18E2 |
FY18E | |
PRODUCTION |
|||||||
Oil (mbopd) |
72 |
72 |
74 |
73-77 |
73-77 |
74 | |
NGL (mbopd) |
35 |
37 |
43 |
40-46 |
40-46 |
41 | |
Gas (mmcfpd) |
401 |
402 |
422 |
420-450 |
420-450 |
425 | |
Total (mboepd) |
174 |
172-180 |
187 |
185-195 |
185-195 |
180-190 | |
CAPEX ($MM) |
$345 |
$360 |
$365 |
$365 |
$275 |
$1,350 | |
ANADARKO GUIDANCE |
|||||||
PRODUCTION |
|||||||
Oil (mbopd) |
40 |
42 |
42 |
42-44 |
42-44 |
42 | |
NGL (mbopd) |
31 |
33 |
38 |
36-40 |
36-40 |
36 | |
Gas (mmcfpd) |
279 |
288 |
304 |
310-330 |
310-330 |
305 | |
Total (mboepd) |
117 |
120-126 |
131 |
130-140 |
130-140 |
125-135 | |
CAPEX ($MM) |
$282 |
$265 |
$291 |
$265 |
$220 |
$1,060 | |
China Production (mboepd) |
3 |
7-9 |
9 |
2-3 |
3-5 |
1Production and capital are expected to be within 5% of the estimates above |
2Individual product guidance ranges do not necessarily sum to total production guidance range. |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale, liquids-rich resource plays in the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. In addition, we have a producing oil field offshore China.
**This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "forecast," "outlook," "could," "budget," "objectives," "strategy," "believe," "expect," "anticipate," "intend," "estimate," "project," "prospective," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets and expected production mix, estimated future operating costs and other expenses and other financial measures, estimated future tax rates, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although, as of the date of this release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks, some of which are beyond Newfield's control and are difficult to predict. No assurance can be given that such expectations will prove to have been correct. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, changes in commodity mix, accessibility to economic transportation modes and processing facilities, our liquidity and the availability of capital resources, operating risks, industry conditions, U.S. and China governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other oilfield services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, new regulations or changes in tax or environmental legislation, environmental liabilities not covered by indemnity or insurance, legislation or regulatory initiatives intended to address seismic activity, and other operating risks. Please see Newfield's 2017 Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other subsequent public filings, all filed with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed in this press release or in Newfield's SEC filings could also have material adverse effects on Newfield's actual results as compared to its anticipated results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this release and are not guarantees of performance. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5182
Email: IR@newfield.com
2Q18 Actual Results | |||||||||||
Domestic |
China |
Total | |||||||||
Production/Liftings(1) |
|||||||||||
Crude oil and condensate (MBbls) |
6,696 |
782 |
7,478 |
||||||||
Natural gas (Bcf) |
38.4 |
— |
38.4 |
||||||||
NGLs (MBbls) |
3,892 |
— |
3,892 |
||||||||
Total (MBOE) |
16,989 |
782 |
17,771 |
||||||||
Average Realized Prices(2) |
|||||||||||
Crude oil and condensate (per Bbl) |
$ |
63.15 |
$ |
73.97 |
$ |
64.28 |
|||||
Natural gas (per Mcf) |
2.22 |
— |
2.22 |
||||||||
NGLs (per Bbl) |
28.82 |
— |
28.82 |
||||||||
Crude oil equivalent (per BOE) |
$ |
36.50 |
$ |
73.97 |
$ |
38.15 |
Domestic |
China |
Total |
Domestic |
China |
Total | ||||||||||||||||||
Selected Expenses: |
(In millions) |
(Per BOE) | |||||||||||||||||||||
Lease operating |
$ |
60 |
$ |
13 |
$ |
73 |
$ |
3.54 |
$ |
16.69 |
$ |
4.12 |
|||||||||||
Transportation and processing |
83 |
— |
83 |
4.85 |
— |
4.64 |
|||||||||||||||||
Production and other taxes |
26 |
1 |
27 |
1.52 |
1.32 |
1.51 |
|||||||||||||||||
General and administrative, net(3) |
50 |
1 |
51 |
2.94 |
1.83 |
2.90 |
|||||||||||||||||
Other operating expenses (income), net |
(7) |
1 |
(6) |
(0.41) |
0.72 |
(0.36) |
|||||||||||||||||
Interest expense |
37 |
2.10 |
|||||||||||||||||||||
Capitalized Interest |
(15) |
(0.84) |
|||||||||||||||||||||
Other non-operating (income) expense |
— |
— |
_______ | |
(1) |
Represents volumes lifted and sold regardless of when produced. |
(2) |
Average realized prices including the effects of derivative contracts for our domestic and consolidated crude oil and condensate would have been $52.72 per barrel and $54.94 per barrel, respectively. The average realized price including the effects of derivative contracts for domestic natural gas would have been $2.32 per Mcf and the average realized price for domestic NGLs would have been $28.54 per barrel. We did not have any derivative contracts associated with our China production as of June 30, 2018. |
(3) |
Net general and administrative expenses excludes $13 million, or $0.75 per BOE, of capitalized direct internal costs. |
CONDENSED CONSOLIDATED BALANCE SHEET | |||||||
(Unaudited, in millions) | |||||||
June 30, |
December 31, | ||||||
2018 |
2017 | ||||||
ASSETS | |||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ |
293 |
$ |
326 |
|||
Derivative assets |
2 |
15 |
|||||
Other current assets |
461 |
405 |
|||||
Total current assets |
756 |
746 |
|||||
Oil and gas properties, net (full cost method) |
4,416 |
3,931 |
|||||
Restricted cash |
46 |
40 |
|||||
Other assets |
243 |
244 |
|||||
Total assets |
$ |
5,461 |
$ |
4,961 |
|||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: |
|||||||
Derivative liabilities |
$ |
228 |
$ |
98 |
|||
Other current liabilities |
822 |
720 |
|||||
Total current liabilities |
1,050 |
818 |
|||||
Other liabilities |
66 |
69 |
|||||
Derivative liabilities |
39 |
26 |
|||||
Long-term debt |
2,435 |
2,434 |
|||||
Asset retirement obligations |
134 |
130 |
|||||
Deferred taxes |
97 |
76 |
|||||
Total long-term liabilities |
2,771 |
2,735 |
|||||
Stockholders' equity: |
|||||||
Common stock, treasury stock and additional paid-in capital |
3,274 |
3,246 |
|||||
Accumulated other comprehensive income (loss) |
(1) |
— |
|||||
Retained earnings (deficit) |
(1,633) |
(1,838) |
|||||
Total stockholders' equity |
1,640 |
1,408 |
|||||
Total liabilities and stockholders' equity |
$ |
5,461 |
$ |
4,961 |
CONSOLIDATED STATEMENT OF OPERATIONS | |||||||||||||||
(Unaudited, in millions, except per share data) | |||||||||||||||
Three Months Ended |
Six Months Ended | ||||||||||||||
June 30, |
June 30, | ||||||||||||||
2018 |
2017 |
2018 |
2017 | ||||||||||||
Oil, gas and NGL revenues |
$ |
679 |
$ |
402 |
$ |
1,259 |
$ |
819 |
|||||||
Operating expenses: |
|||||||||||||||
Lease operating |
73 |
58 |
131 |
114 |
|||||||||||
Transportation and processing |
83 |
71 |
161 |
143 |
|||||||||||
Production and other taxes |
27 |
13 |
51 |
27 |
|||||||||||
Depreciation, depletion and amortization |
151 |
110 |
284 |
216 |
|||||||||||
General and administrative |
51 |
51 |
105 |
98 |
|||||||||||
Other |
(6) |
— |
(5) |
1 |
|||||||||||
Total operating expenses |
379 |
303 |
727 |
599 |
|||||||||||
Income (loss) from operations |
300 |
99 |
532 |
220 |
|||||||||||
Other income (expense): |
|||||||||||||||
Interest expense |
(37) |
(37) |
(75) |
(75) |
|||||||||||
Capitalized interest |
15 |
15 |
30 |
31 |
|||||||||||
Commodity derivative income (expense) |
(145) |
28 |
(256) |
81 |
|||||||||||
Other, net |
— |
2 |
1 |
4 |
|||||||||||
Total other income (expense) |
(167) |
8 |
(300) |
41 |
|||||||||||
Income (loss) before income taxes |
133 |
107 |
232 |
261 |
|||||||||||
Income tax provision (benefit) |
14 |
9 |
27 |
16 |
|||||||||||
Net income (loss) |
$ |
119 |
$ |
98 |
$ |
205 |
$ |
245 |
|||||||
Earnings (loss) per share: |
|||||||||||||||
Basic |
$ |
0.60 |
$ |
0.49 |
$ |
1.03 |
$ |
1.23 |
|||||||
Diluted |
$ |
0.59 |
$ |
0.49 |
$ |
1.02 |
$ |
1.22 |
|||||||
Weighted-average number of shares outstanding for basic earnings (loss) per share |
200 |
199 |
200 |
199 |
|||||||||||
Weighted-average number of shares outstanding for diluted earnings (loss) per share |
201 |
200 |
200 |
200 |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | |||||||
(Unaudited, in millions) | |||||||
Six Months Ended | |||||||
June 30, | |||||||
2018 |
2017 | ||||||
Cash flows from operating activities: |
|||||||
Net income (loss) |
$ |
205 |
$ |
245 |
|||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|||||||
Depreciation, depletion and amortization |
284 |
216 |
|||||
Deferred tax provision (benefit) |
21 |
16 |
|||||
Stock-based compensation |
25 |
20 |
|||||
Unrealized (gain) loss on derivative contracts |
157 |
(46) |
|||||
Other, net |
5 |
7 |
|||||
697 |
458 |
||||||
Changes in operating assets and liabilities |
51 |
16 |
|||||
Net cash provided by (used in) operating activities |
748 |
474 |
|||||
Cash flows from investing activities: |
|||||||
Additions to and acquisitions of oil and gas properties and other |
(789) |
(521) |
|||||
Proceeds from sales of oil and gas properties |
23 |
28 |
|||||
Net cash provided by (used in) investing activities |
(766) |
(493) |
|||||
Cash flows from financing activities: |
|||||||
Debt issue costs |
(8) |
— |
|||||
Other, net |
(1) |
(7) |
|||||
Net cash provided by (used in) financing activities |
(9) |
(7) |
|||||
Net increase (decrease) in cash, cash equivalents and restricted cash |
(27) |
(26) |
|||||
Cash, cash equivalents and restricted cash, beginning of period |
$ |
366 |
$ |
580 |
|||
Cash, cash equivalents and restricted cash, end of period |
$ |
339 |
$ |
554 |
Explanation and Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Earnings Stated Without the Effect of Certain Items)
Earnings stated without the effect of certain items is a non-GAAP financial measure. Earnings without the effect of these items are presented because they affect the comparability of operating results from period to period. In addition, earnings without the effect of these items are more comparable to earnings estimates provided by securities analysts. This measure should not be considered an alternative to net income (loss) as defined by generally accepted accounting principles (GAAP). A reconciliation of earnings for the second quarter of 2018 stated without the effect of certain items to net income (loss) is shown below (in millions, except per share data):
2Q18 | |||||||
(In millions) |
(Per diluted share) | ||||||
Net Income (loss) |
$ |
119 |
$ |
0.59 |
|||
Unrealized (gain) loss on derivative contracts |
78 |
0.39 |
|||||
Legal settlement |
(8) |
(0.04) |
|||||
Earnings stated without the effect of the above items |
$ |
189 |
$ |
0.94 |
|||
Weighted-average number of shares outstanding for per diluted share |
201 |
Discretionary Cash Flow from Operations
Discretionary cash flow from operations represents net cash provided by operating activities before changes in operating assets and liabilities and is presented because of its acceptance as an indicator of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur additional debt. This measure should not be considered an alternative to net cash provided by operating activities as defined by GAAP. A reconciliation of net cash provided by operating activities to discretionary cash flow from operations is shown below:
2Q18 | |||
(In millions) | |||
Net cash provided by operating activities |
$ |
488 |
|
Net changes in operating assets and liabilities |
(112) |
||
Discretionary cash flow from operations |
$ |
376 |
Net Debt to Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
EBITDA is determined by subtracting from net income, interest, income tax provision, and DD&A. Adjusted EBITDA, a non-GAAP measure, further subtracts out non-cash items related to impairments, stock based compensation, derivative gain or loss, and other permitted adjustments. Adjusted EBITDA should not be considered an alternative to net income, as defined by GAAP. A reconciliation of net income to EBITDA, and to adjusted EBITDA, is shown below. Net debt is defined as principal amount of debt less cash and cash equivalents.
QTD |
Twelve Months Ended | ||||||||||||||||||
3Q17 |
4Q17 |
1Q18 |
2Q18 |
June 30, 2018 | |||||||||||||||
(In millions) | |||||||||||||||||||
Net Income |
$ |
87 |
$ |
95 |
$ |
86 |
$ |
119 |
$ |
387 |
|||||||||
Adjustments to derive EBITDA: |
|||||||||||||||||||
Interest expense, net of capitalized interest |
22 |
23 |
23 |
22 |
90 |
||||||||||||||
Income tax provision (benefit) |
(19) |
(38) |
13 |
14 |
(30) |
||||||||||||||
Depreciation, depletion and amortization (DD&A) |
124 |
127 |
133 |
151 |
535 |
||||||||||||||
EBITDA |
$ |
214 |
$ |
207 |
$ |
255 |
$ |
306 |
982 |
||||||||||
Adjustments to EBITDA: |
|||||||||||||||||||
Ceiling test and other impairment |
$ |
— |
$ |
— |
$ |
— |
$ |
— |
$ |
— |
|||||||||
Non-cash stock based compensation |
5 |
9 |
9 |
16 |
39 |
||||||||||||||
Unrealized (gain) loss on commodity derivatives |
34 |
95 |
79 |
78 |
286 |
||||||||||||||
Other permitted adjustments |
1 |
3 |
1 |
(6) |
(1) |
||||||||||||||
Adjusted EBITDA |
$ |
254 |
$ |
314 |
$ |
344 |
$ |
394 |
$ |
1,306 |
|||||||||
Long-term debt |
$ |
2,450 |
|||||||||||||||||
Less: Cash |
293 |
||||||||||||||||||
Net debt |
$ |
2,157 |
|||||||||||||||||
Net debt / Adjusted EBITDA |
1.7 |
View original content:http://www.prnewswire.com/news-releases/newfield-exploration-reports-second-quarter-2018-results-300689590.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, June 20, 2018 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) plans to host its second quarter 2018 earnings conference call at 7:30 a.m. (CDT), Wednesday, August 1, 2018. The Company plans to release its second quarter earnings after market close on July 31, 2018.
To participate in the conference call, please dial (323) 794-2094 and provide conference code 1873319 at least 10 minutes prior to the scheduled start time. In addition, a listen-only broadcast of the call will be provided over the internet at http://www.newfield.com, under Investor Relations.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have producing oil assets offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
View original content:http://www.prnewswire.com/news-releases/newfield-provides-second-quarter-2018-conference-call-information-300669494.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, May 1, 2018 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today announced first quarter 2018 unaudited financial and operating results. Additional details can be found in the Company's @NFX publication, located on its website http://www.newfield.com.
Newfield plans to host a conference call at 10 a.m. CDT on May 2, 2018. To listen to the call, please visit Newfield's website at http://www.newfield.com. To participate in the call, dial 323-794-2551 and provide conference code 3053206 at least 10 minutes prior to the scheduled start time.
First Quarter Highlights
First Quarter 2018 Financial and Production Summary
For the first quarter, the Company recorded net income of $86 million, or $0.43 per diluted share (all per share amounts are on a diluted basis). Earnings were impacted by an unrealized derivative loss of $79 million, or $0.39 per share. After adjusting for the effect of the unrealized derivative loss during the period, net income would have been $165 million, or $0.82 per share. See the "Explanation and Reconciliation of Non-GAAP Financial Measures" at the end of this press release for additional disclosures.
Revenues for the first quarter were $580 million. Net cash provided by operating activities was $260 million. Discretionary cash flow from operations was $321 million.
Newfield's consolidated net production in the first quarter of 2018 was approximately 176,500 BOEPD, comprised of 42% oil, 20% natural gas liquids and 38% natural gas. Domestic net production in the first quarter was approximately 173,600 BOEPD, comprised of 41% oil, 20% natural gas liquids and 39% natural gas.
2018E Production, Cost and Expense Guidance
Domestic Production |
|||
Oil (mbopd) |
74 |
||
NGLs (mbopd) |
38 |
||
Natural Gas (mmcfpd) |
412 |
||
Total (mboepd) |
175 - 185 |
||
Domestic Expenses ($/BOE)1 |
|||
LOE2 |
$ |
3.43 |
|
Transportation3 |
4.95 |
||
Production & other taxes |
4.7 |
% | |
General & administrative (G&A), net |
$ |
3.44 |
|
Interest expense, net |
1.42 |
||
Effective Tax rate |
0 - 5 |
% | |
CAPEX ($MM)1 |
|||
Drilling & Completion |
$ |
1,160 |
|
Other |
140 |
||
Total CAPEX1 |
$ |
1,300 |
|
China Production (mbopd)4 |
3 - 5 |
1Cost and expenses are expected to be within 5% of the estimates above |
2Total LOE includes recurring, major expense and non E&P operating expenses |
32018E transportation / processing fees include ~$38 million of Arkoma unused firm gas transportation and ~$21 million of Uinta oil and gas delivery shortfall fees |
4Full year estimates include the first quarter lifting of 261,000 barrels and planned liftings of approximately 750,000 barrels in the second quarter. Additional liftings totaling approximately 500,000 barrels are planned for the second half of 2018. |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale, liquids-rich resource plays in the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. In addition, we have a producing oil field offshore China.
**This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "forecast," "outlook," "could," "budget," "objectives," "strategy," "believe," "expect," "anticipate," "intend," "estimate," "project," "prospective," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets, estimated future operating costs and other expenses and other financial measures, estimated future tax rates, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although, as of the date of this release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks, some of which are beyond Newfield's control and are difficult to predict. No assurance can be given that such expectations will prove to have been correct. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, U.S. and China governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other oilfield services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, new regulations or changes in tax or environmental legislation, environmental liabilities not covered by indemnity or insurance, legislation or regulatory initiatives intended to address seismic activity, and other operating risks. Please see Newfield's 2017 Annual Report on Form 10-K, Quarterly Report on Form 10-Q and other subsequent public filings, all filed with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed in this press release or in Newfield's SEC filings could also have material adverse effects on Newfield's actual results as compared to its anticipated results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this release and are not guarantees of performance. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
1Q18 Actual Results |
|||||||||||||||||||||||
Domestic |
China |
Total | |||||||||||||||||||||
Production/Liftings(1) |
|||||||||||||||||||||||
Crude oil and condensate (MBbls) |
6,451 |
261 |
6,712 |
||||||||||||||||||||
Natural gas (Bcf) |
36.1 |
— |
36.1 |
||||||||||||||||||||
NGLs (MBbls) |
3,159 |
— |
3,159 |
||||||||||||||||||||
Total (MBOE) |
15,622 |
261 |
15,883 |
||||||||||||||||||||
Average Realized Prices(2) |
|||||||||||||||||||||||
Crude oil and condensate (per Bbl) |
$ |
58.09 |
$ |
65.09 |
$ |
58.36 |
|||||||||||||||||
Natural gas (per Mcf) |
2.70 |
— |
2.70 |
||||||||||||||||||||
NGLs (per Bbl) |
28.04 |
— |
28.04 |
||||||||||||||||||||
Crude oil equivalent (per BOE) |
$ |
35.90 |
$ |
65.09 |
$ |
36.38 |
|||||||||||||||||
Domestic |
China |
Total |
Domestic |
China |
Total | ||||||||||||||||||
Selected Expenses: |
(In millions) |
(Per BOE) | |||||||||||||||||||||
Lease operating |
$ |
54 |
$ |
4 |
$ |
58 |
$ |
3.43 |
$ |
15.72 |
$ |
3.64 |
|||||||||||
Transportation and processing |
78 |
— |
78 |
5.02 |
— |
4.93 |
|||||||||||||||||
Production and other taxes |
24 |
— |
24 |
1.53 |
0.57 |
1.51 |
|||||||||||||||||
General and administrative, net(3) |
52 |
2 |
54 |
3.35 |
4.56 |
3.37 |
|||||||||||||||||
Other operating expenses (income), net |
1 |
0.09 |
|||||||||||||||||||||
Interest expense |
38 |
2.39 |
|||||||||||||||||||||
Capitalized Interest |
(15) |
(0.93) |
|||||||||||||||||||||
Other non-operating (income) expense |
(1) |
(0.09) |
_______ | |
(1) |
Represents volumes lifted and sold regardless of when produced. |
(2) |
Average realized prices including the effects of derivative contracts for our domestic and consolidated crude oil and condensate would have been $52.12 per barrel and $52.63 per barrel, respectively. The average realized price for domestic natural gas would have been $2.88 per Mcf and the average realized price for domestic NGLs would have been $27.87 per barrel. We did not have any derivative contracts associated with our China production as of March 31, 2018. |
(3) |
Net general and administrative expenses include $13 million, or $0.81 per BOE, of capitalized direct internal costs. |
CONDENSED CONSOLIDATED BALANCE SHEET | |||||||
(Unaudited, in millions) | |||||||
March 31, |
December 31, | ||||||
2018 |
2017 | ||||||
ASSETS |
|||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ |
196 |
$ |
326 |
|||
Derivative assets |
12 |
15 |
|||||
Other current assets |
438 |
405 |
|||||
Total current assets |
646 |
746 |
|||||
Oil and gas properties, net (full cost method) |
4,187 |
3,931 |
|||||
Restricted cash |
45 |
40 |
|||||
Other assets |
244 |
244 |
|||||
Total assets |
$ |
5,122 |
$ |
4,961 |
|||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|||||||
Current liabilities: |
|||||||
Derivative liabilities |
$ |
153 |
$ |
98 |
|||
Other current liabilities |
691 |
720 |
|||||
Total current liabilities |
844 |
818 |
|||||
Other liabilities |
71 |
69 |
|||||
Derivative liabilities |
46 |
26 |
|||||
Long-term debt |
2,434 |
2,434 |
|||||
Asset retirement obligations |
133 |
130 |
|||||
Deferred taxes |
89 |
76 |
|||||
Total long-term liabilities |
2,773 |
2,735 |
|||||
Stockholders' equity: |
|||||||
Common stock, treasury stock and additional paid-in capital |
3,258 |
3,246 |
|||||
Accumulated other comprehensive income (loss) |
(1) |
— |
|||||
Retained earnings (deficit) |
(1,752) |
(1,838) |
|||||
Total stockholders' equity |
1,505 |
1,408 |
|||||
Total liabilities and stockholders' equity |
$ |
5,122 |
$ |
4,961 |
CONSOLIDATED STATEMENT OF OPERATIONS | |||||||
(Unaudited, in millions, except per share data) | |||||||
Three Months Ended | |||||||
March 31, | |||||||
2018 |
2017 | ||||||
Oil, gas and NGL revenues |
$ |
580 |
$ |
417 |
|||
Operating expenses: |
|||||||
Lease operating |
58 |
56 |
|||||
Transportation and processing |
78 |
72 |
|||||
Production and other taxes |
24 |
14 |
|||||
Depreciation, depletion and amortization |
133 |
106 |
|||||
General and administrative |
54 |
47 |
|||||
Other |
1 |
1 |
|||||
Total operating expenses |
348 |
296 |
|||||
Income (loss) from operations |
232 |
121 |
|||||
Other income (expense): |
|||||||
Interest expense |
(38) |
(38) |
|||||
Capitalized interest |
15 |
16 |
|||||
Commodity derivative income (expense) |
(111) |
53 |
|||||
Other, net |
1 |
2 |
|||||
Total other income (expense) |
(133) |
33 |
|||||
Income (loss) before income taxes |
99 |
154 |
|||||
Income tax provision (benefit) |
13 |
7 |
|||||
Net income (loss) |
$ |
86 |
$ |
147 |
|||
Earnings (loss) per share: |
|||||||
Basic |
$ |
0.43 |
$ |
0.74 |
|||
Diluted |
$ |
0.43 |
$ |
0.73 |
|||
Weighted-average number of shares outstanding for basic earnings (loss) per share |
200 |
199 |
|||||
Weighted-average number of shares outstanding for diluted earnings (loss) per share |
200 |
200 |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | |||||||
(Unaudited, in millions) | |||||||
Three Months Ended | |||||||
March 31, | |||||||
2018 |
2017 | ||||||
Cash flows from operating activities: |
|||||||
Net income (loss) |
$ |
86 |
$ |
147 |
|||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|||||||
Depreciation, depletion and amortization |
133 |
106 |
|||||
Deferred tax provision (benefit) |
13 |
9 |
|||||
Stock-based compensation |
9 |
12 |
|||||
Unrealized (gain) loss on derivative contracts |
79 |
(33) |
|||||
Other, net |
1 |
2 |
|||||
321 |
243 |
||||||
Changes in operating assets and liabilities |
(61) |
(73) |
|||||
Net cash provided by (used in) operating activities |
260 |
170 |
|||||
Cash flows from investing activities: |
|||||||
Additions to and acquisitions of oil and gas properties and other |
(378) |
(246) |
|||||
Proceeds from sales of oil and gas properties |
2 |
(5) |
|||||
Net cash provided by (used in) investing activities |
(376) |
(251) |
|||||
Cash flows from financing activities: |
|||||||
Debt issue costs |
(7) |
— |
|||||
Other, net |
(2) |
(2) |
|||||
Net cash provided by (used in) financing activities |
(9) |
(2) |
|||||
Net increase (decrease) in cash, cash equivalents and restricted cash |
(125) |
(83) |
|||||
Cash, cash equivalents and restricted cash, beginning of period |
$ |
366 |
$ |
580 |
|||
Cash, cash equivalents and restricted cash, end of period |
$ |
241 |
$ |
497 |
Explanation and Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Earnings Stated Without the Effect of Certain Items)
Earnings stated without the effect of certain items is a non-GAAP financial measure. Earnings without the effect of these items are presented because they affect the comparability of operating results from period to period. In addition, earnings without the effect of these items are more comparable to earnings estimates provided by securities analysts. This measure should not be considered an alternative to net income (loss) as defined by generally accepted accounting principles.
A reconciliation of earnings for the first quarter of 2018 stated without the effect of certain items to net income (loss) is shown below (in millions, except per share data):
1Q18 | |||||||
(In millions) |
(Per diluted | ||||||
Net Income (loss) |
$ |
86 |
$ |
0.43 |
|||
Unrealized (gain) loss on derivative contracts |
79 |
0.39 |
|||||
Earnings stated without the effect of the above items |
$ |
165 |
$ |
0.82 |
|||
Weighted-average number of shares outstanding for per diluted share |
200 |
Discretionary Cash Flow from Operations
Discretionary cash flow from operations represents net cash provided by operating activities before changes in operating assets and liabilities and is presented because of its acceptance as an indicator of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur additional debt. This measure should not be considered an alternative to net cash provided by operating activities as defined by generally accepted accounting principles.
A reconciliation of net cash provided by operating activities to discretionary cash flow from operations is shown below:
1Q18 | |||
(In millions) | |||
Net cash provided by operating activities |
$ |
260 |
|
Net changes in operating assets and liabilities |
61 |
||
Discretionary cash flow from operations |
$ |
321 |
View original content:http://www.prnewswire.com/news-releases/newfield-exploration-reports-first-quarter-2018-results-300640478.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, March 26, 2018 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) will host its first quarter 2018 earnings conference call at 10:00 a.m. (CDT), Wednesday, May 2, 2018. The Company plans to release its first quarter earnings after market close on May 1, 2018.
To participate in the conference call, please dial (323) 794-2551 and provide conference code 3053206 at least 10 minutes prior to the scheduled start time. In addition, a listen-only broadcast of the call will be provided over the internet at http://www.newfield.com, under Investor Relations.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have oil assets offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
View original content:http://www.prnewswire.com/news-releases/newfield-provides-first-quarter-2018-conference-call-information-300619382.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, March 14, 2018 /PRNewswire/ -- Newfield Exploration Company's (NYSE: NFX) charitable foundation today announced it had awarded grants in the amount of $315,000 to 12 charities located in the Oklahoma communities where the company operates.
"Since Newfield arrived in Oklahoma 17 years ago, we have always had a belief that we should support the communities where our employees not only work, but live," said Lee K. Boothby, Newfield chairman, president and CEO. "Strengthening local communities is at the heart of our Foundation and we are proud to be involved in helping to enrich the quality of life of Oklahoma families."
To reinforce its mission, the Newfield Foundation supports programs in the environment, medical, cultural arts and community services. Receiving grants this year in Oklahoma were eight community service charities, three environmental organizations and one medical foundation. The charities include:
Boys & Girls Club of McAlester |
The Toby Keith Foundation |
Calumet Fire Department |
Wheatbelt Chapter of National Ambucs |
Center of Family Love, Kingfisher |
Oklahoma Ducks Unlimited |
Kingfisher Community Collaborative |
Kingfisher Trails |
Oklahoma Youth Expo |
National Wild Turkey Federation |
Regional Food Bank of Oklahoma |
McAlester Scottish Rite C&E Foundation |
In 2018, The Newfield Foundation, which is employee-driven with charities nominated by employees, awarded grants totaling $1,002,500 to local organizations in Oklahoma, Utah, North Dakota and Texas. Newfield employees are encouraged to contribute a portion of their time, talent and personal resources to help where it matters most and to nominate local charities for further consideration by the Newfield Foundation.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on liquids-rich U.S. resource plays and our principal areas of operation include Oklahoma, Utah and North Dakota. We also have offshore oil developments in China.
For additional information, please contact Newfield's Communications department.
Phone: 281-210-5253
Email: chassler@newfield.com
View original content:http://www.prnewswire.com/news-releases/newfield-explorations-foundation-contributes-315000-to-oklahoma-charities-300613999.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Dec. 7, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) will host its fourth quarter / full year 2017 earnings conference call at 10:00 a.m. (CST), Wednesday, February 21, 2018. The Company plans to release its fourth quarter earnings after market close on February 20, 2018.
To participate in the conference call, please dial (323) 794-2094 and provide conference code 7828350 at least 10 minutes prior to the scheduled start time. In addition, a listen-only broadcast of the call will be provided over the internet at http://www.newfield.com, under Investor Relations.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have oil assets offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
View original content:http://www.prnewswire.com/news-releases/newfield-provides-fourth-quarter--full-year-2017-conference-call-information-300568528.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Nov. 8, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) is scheduled to present at the following events over the next several weeks:
Bank of America Merrill Lynch 2017 Global Energy Conference *
10:30 a.m. (Eastern), November 17, 2017
Jefferies 2017 Energy Conference *
10:55 a.m. (Central), November 28, 2017
Bank of America Merrill Lynch 2017 Leveraged Finance Conference *
8:50 a.m. (Eastern), November 30. 2017
Capital One Securities 12th Annual Energy Conference *
10:30 a.m. (Central), December 7, 2017
*A live webcast of the presentations will be made available through Newfield's website at http://www.newfield.com.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale, liquids-rich resource plays in the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. In addition, we have oil assets offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
View original content:http://www.prnewswire.com/news-releases/newfield-exploration-to-present-at-upcoming-events-300552385.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Oct. 31, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today announced third quarter 2017 unaudited financial and operating results. Additional details can be found in the Company's @NFX publication, located on its website.
Newfield plans to host a conference call at 10 a.m. CDT on November 1, 2017. To listen to the call, please visit Newfield's website at http://www.newfield.com. To participate in the call, dial 719-457-2641 and provide conference code 7914344 at least 10 minutes prior to the scheduled start time.
Highlights
Third Quarter 2017 Financial and Production Summary
For the third quarter, the Company recorded net income of $87 million, or $0.44 per diluted share (all per share amounts are on a diluted basis). Earnings were impacted by one time tax benefits of $17 million, or $0.09 per share, due to the carryback of net operating losses, and an unrealized derivative loss of $34 million, or $0.17 per share. After adjusting for the effect of the tax benefit and unrealized derivative loss during the period, net income would have been $104 million, or $0.52 per share. See the "Explanation and Reconciliation of Non-GAAP Financial Measures" at the end of this press release for additional disclosures.
Revenues for the third quarter were $439 million. Net cash provided by operating activities was $173 million. Discretionary cash flow from operations was $262 million.
Newfield's total net production in the third quarter of 2017 was approximately 161,700 BOEPD, comprised of 42% oil, 22% natural gas liquids and 36% natural gas. Domestic production in the third quarter was approximately 159,000 BOEPD, comprised of 41% oil, 23% natural gas liquids and 36% natural gas.
2017e Production, Cost and Expense Guidance
Domestic |
China |
Total | |||||||||
Production |
|||||||||||
Oil % |
40% |
100% |
42% |
||||||||
NGLs % |
21% |
— |
20% |
||||||||
Natural Gas % |
39% |
— |
38% |
||||||||
Total (MBOEPD)1 |
150.0 - 154.0 |
4.7 |
154.7 - 158.7 |
||||||||
Expenses ($/BOE)2 |
|||||||||||
LOE3,5 |
$ |
3.48 |
$ |
15.65 |
$ |
3.84 |
|||||
Transportation4 |
5.58 |
— |
5.41 |
||||||||
Production & other taxes |
1.07 |
0.18 |
1.04 |
||||||||
General & administrative (G&A), net5 |
$ |
3.58 |
$ |
3.88 |
$ |
3.59 |
|||||
Interest expense, gross |
— |
— |
2.62 |
||||||||
Capitalized interest and direct internal costs |
$ |
— |
$ |
— |
$ |
(2.21) |
|||||
Effective Tax rate |
0 - 5% |
0 - 5% |
0 - 5% |
1Total Company and China volumes include impact of Bohai Bay divestiture |
2Cost and expenses are expected to be within 5% of the estimates above |
3Total LOE includes recurring, major expense and non E&P operating expenses |
42017e transportation / processing fees include ~$52 million of Arkoma unused firm gas transportation and ~$33 million of Uinta oil and gas delivery shortfall fees |
5Total LOE and G&A includes $2 million and $2 million, respectively, associated with remainder of 2017 activity in China |
4Q17e Production, Cost and Expense Guidance
Domestic |
China |
Total | ||||||||
Production |
||||||||||
Oil % |
39% |
— |
39% | |||||||
NGLs % |
22% |
— |
22% | |||||||
Natural Gas % |
39% |
— |
39% | |||||||
Total (MBOEPD) |
162.0 - 174.0 |
— |
162.0 - 174.0 | |||||||
Expenses ($/BOE)1 |
||||||||||
LOE2,4 |
$ |
3.20 |
$ |
— |
$ |
3.30 | ||||
Transportation3 |
5.58 |
— |
5.58 | |||||||
Production & other taxes |
1.07 |
— |
1.07 | |||||||
General & administrative (G&A), net4 |
$ |
3.31 |
$ |
— |
$ |
3.44 | ||||
Interest expense, gross |
— |
— |
2.41 | |||||||
Capitalized interest and direct internal costs |
$ |
— |
$ |
— |
$ |
(1.89) | ||||
Effective Tax rate |
0 - 5% |
— |
0 - 5% |
1Cost and expenses are expected to be within 5% of the estimates above |
2Total LOE includes recurring, major expense and non E&P operating expenses |
34Q17e transportation / processing fees include ~$13 million of Arkoma unused firm gas transportation and ~$9 million of Uinta oil and gas delivery shortfall fees |
4Total LOE and G&A includes $2 million and $2 million, respectively, associated with remainder of 2017 activity in China |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale, liquids-rich resource plays in the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. In addition, we have oil assets offshore China.
**This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "forecast," "outlook," "could," "budget," "objectives," "strategy," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets, estimated future operating costs and other expenses and other financial measures, estimated future tax rates, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although, as of the date of this release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks and no assurance can be given that such expectations will prove to have been correct. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, U.S. and China governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, new regulations or changes in tax or environmental legislation, environmental liabilities not covered by indemnity or insurance, legislation or regulatory initiatives intended to address seismic activity, and other operating risks. Please see Newfield's 2016 Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other subsequent public filings, all filed with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed in this press release or in Newfield's SEC filings could also have material adverse effects on Newfield's actual results as compared to its anticipated results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this release. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
3Q17 Actual | |||||||||||
3Q17 Actual Results |
Domestic |
China |
Total | ||||||||
Production/Liftings(1) |
|||||||||||
Crude oil and condensate (MBbls) |
6,028 |
239 |
6,267 |
||||||||
Natural gas (Bcf) |
32.0 |
— |
32.0 |
||||||||
NGLs (MBbls) |
3,279 |
— |
3,279 |
||||||||
Total (MBOE) |
14,635 |
239 |
14,874 |
||||||||
Average Realized Prices(2)(3) |
|||||||||||
Crude oil and condensate (per Bbl) |
$ |
45.70 |
$ |
48.22 |
$ |
45.80 |
|||||
Natural gas (per Mcf) |
2.52 |
— |
2.52 |
||||||||
NGLs (per Bbl) |
25.72 |
— |
25.72 |
||||||||
Crude oil equivalent (per BOE) |
$ |
30.32 |
$ |
48.22 |
$ |
30.61 |
|||||
Operating Expenses:(3) |
|||||||||||
Lease operating (in millions) |
|||||||||||
Recurring |
$ |
41 |
$ |
4 |
$ |
45 |
|||||
Major (workovers, etc.) |
$ |
8 |
$ |
— |
$ |
8 |
|||||
Lease operating (per BOE) |
|||||||||||
Recurring |
$ |
2.79 |
$ |
19.11 |
$ |
3.06 |
|||||
Major (workovers, etc.) |
$ |
0.55 |
$ |
0.07 |
$ |
0.54 |
|||||
Transportation and processing (in millions) |
$ |
80 |
$ |
— |
$ |
80 |
|||||
per BOE |
$ |
5.55 |
$ |
— |
$ |
5.46 |
|||||
Production and other taxes (in millions) |
$ |
16 |
$ |
— |
$ |
16 |
|||||
per BOE |
$ |
1.12 |
$ |
— |
$ |
1.11 |
|||||
General and administrative (G&A), net (in millions) |
$ |
51 |
$ |
2 |
$ |
53 |
|||||
per BOE |
$ |
3.63 |
$ |
6.11 |
$ |
3.67 |
|||||
Capitalized direct internal costs (in millions) |
$ |
(18) |
|||||||||
per BOE |
$ |
(1.20) |
|||||||||
Other operating expenses (income), net (in millions) |
$ |
1 |
|||||||||
per BOE |
$ |
0.05 |
|||||||||
Interest expense (in millions) |
$ |
37 |
|||||||||
per BOE |
$ |
2.56 |
|||||||||
Capitalized interest (in millions) |
$ |
(15) |
|||||||||
per BOE |
$ |
(1.02) |
|||||||||
Other non-operating (income) expense (in millions) |
$ |
(1) |
|||||||||
per BOE |
$ |
(0.13) |
(1) |
Represents volumes lifted and sold regardless of when produced. Includes natural gas produced and consumed in operations of 1.3 Bcf during the three months ended September 30, 2017. | |||||||||||
(2) |
Average realized prices include the effects of derivative contracts. Excluding these effects, the average realized price for domestic and total natural gas would have been $2.58 per Mcf and the average realized price for our domestic and total crude oil and condensate would have been $43.79 per barrel and $43.96 per barrel, respectively. We did not have any derivative contracts associated with our NGL or China production as of September 30, 2017. | |||||||||||
(3) |
All per unit pricing and expenses exclude natural gas produced and consumed in operations. |
CONDENSED CONSOLIDATED BALANCE SHEET | |||||||
(Unaudited, in millions) | |||||||
September 30, |
December 31, | ||||||
2017 |
2016 | ||||||
ASSETS | |||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ |
428 |
$ |
555 |
|||
Short-term investments |
— |
25 |
|||||
Derivative assets |
10 |
75 |
|||||
Other current assets |
398 |
294 |
|||||
Total current assets |
836 |
949 |
|||||
Oil and gas properties, net (full cost method) |
3,670 |
3,140 |
|||||
Other assets |
238 |
223 |
|||||
Total assets |
$ |
4,744 |
$ |
4,312 |
|||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: |
|||||||
Derivative liabilities |
$ |
18 |
$ |
97 |
|||
Other current liabilities |
694 |
587 |
|||||
Total current liabilities |
712 |
684 |
|||||
Other liabilities |
71 |
63 |
|||||
Derivative liabilities |
5 |
3 |
|||||
Long-term debt |
2,433 |
2,431 |
|||||
Asset retirement obligations |
158 |
154 |
|||||
Deferred taxes |
64 |
39 |
|||||
Total long-term liabilities |
2,731 |
2,690 |
|||||
Stockholders' equity: |
|||||||
Common stock, treasury stock and additional paid-in capital |
3,235 |
3,205 |
|||||
Accumulated other comprehensive income (loss) |
(1) |
(2) |
|||||
Retained earnings (deficit) |
(1,933) |
(2,265) |
|||||
Total stockholders' equity |
1,301 |
938 |
|||||
Total liabilities and stockholders' equity |
$ |
4,744 |
$ |
4,312 |
CONSOLIDATED STATEMENT OF OPERATIONS | |||||||||||||||
(Unaudited, in millions, except per share data) | |||||||||||||||
Three Months Ended |
Nine Months Ended | ||||||||||||||
September 30, |
September 30, | ||||||||||||||
2017 |
2016 |
2017 |
2016 | ||||||||||||
Oil, gas and NGL revenues |
$ |
439 |
$ |
392 |
$ |
1,258 |
$ |
1,057 |
|||||||
Operating expenses: |
|||||||||||||||
Lease operating |
53 |
60 |
167 |
183 |
|||||||||||
Transportation and processing |
80 |
71 |
223 |
200 |
|||||||||||
Production and other taxes |
16 |
13 |
43 |
34 |
|||||||||||
Depreciation, depletion and amortization |
124 |
120 |
340 |
457 |
|||||||||||
General and administrative |
53 |
65 |
151 |
167 |
|||||||||||
Ceiling test and other impairments |
— |
— |
— |
1,028 |
|||||||||||
Other |
1 |
18 |
2 |
19 |
|||||||||||
Total operating expenses |
327 |
347 |
926 |
2,088 |
|||||||||||
Income (loss) from operations |
112 |
45 |
332 |
(1,031) |
|||||||||||
Other income (expense): |
|||||||||||||||
Interest expense |
(37) |
(37) |
(112) |
(116) |
|||||||||||
Capitalized interest |
15 |
15 |
46 |
35 |
|||||||||||
Commodity derivative income (expense) |
(23) |
28 |
58 |
(122) |
|||||||||||
Other, net |
1 |
1 |
5 |
2 |
|||||||||||
Total other income (expense) |
(44) |
7 |
(3) |
(201) |
|||||||||||
Income (loss) before income taxes |
68 |
52 |
329 |
(1,232) |
|||||||||||
Income tax provision (benefit) |
(19) |
4 |
(3) |
11 |
|||||||||||
Net income (loss) |
$ |
87 |
$ |
48 |
$ |
332 |
$ |
(1,243) |
|||||||
Earnings (loss) per share: |
|||||||||||||||
Basic |
$ |
0.44 |
$ |
0.24 |
$ |
1.67 |
$ |
(6.50) |
|||||||
Diluted |
$ |
0.44 |
$ |
0.24 |
$ |
1.66 |
$ |
(6.50) |
|||||||
Weighted-average number of shares outstanding for basic earnings (loss) per share |
199 |
199 |
199 |
191 |
|||||||||||
Weighted-average number of shares outstanding for diluted earnings (loss) per share |
200 |
200 |
200 |
191 |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | |||||||
(Unaudited, in millions) | |||||||
Nine Months Ended | |||||||
September 30, | |||||||
2017 |
2016 | ||||||
Cash flows from operating activities: |
|||||||
Net income (loss) |
$ |
332 |
$ |
(1,243) |
|||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|||||||
Depreciation, depletion and amortization |
340 |
457 |
|||||
Deferred tax provision (benefit) |
25 |
8 |
|||||
Stock-based compensation |
25 |
14 |
|||||
Unrealized (gain) loss on derivative contracts |
(12) |
307 |
|||||
Ceiling test and other impairments |
— |
1,028 |
|||||
Other, net |
10 |
10 |
|||||
720 |
581 |
||||||
Changes in operating assets and liabilities |
(80) |
6 |
|||||
Net cash provided by (used in) operating activities |
640 |
587 |
|||||
Cash flows from investing activities: |
|||||||
Additions to and acquisitions of oil and gas properties and other |
(828) |
(1,228) |
|||||
Proceeds from sales of oil and gas properties |
74 |
399 |
|||||
Net cash provided by (used in) investing activities |
(754) |
(829) |
|||||
Cash flows from financing activities: |
|||||||
Net proceeds (repayments) of borrowings under credit arrangements |
— |
(39) |
|||||
Proceeds from issuances of common stock, net |
2 |
777 |
|||||
Other, net |
(15) |
(23) |
|||||
Net cash provided by (used in) financing activities |
(13) |
715 |
|||||
Increase (decrease) in cash and cash equivalents |
(127) |
473 |
|||||
Cash and cash equivalents, beginning of period |
555 |
5 |
|||||
Cash and cash equivalents, end of period |
$ |
428 |
$ |
478 |
Explanation and Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Earnings Stated Without the Effect of Certain Items)
Earnings stated without the effect of certain items is a non-GAAP financial measure. Earnings without the effect of these items are presented because they affect the comparability of operating results from period to period. In addition, earnings without the effect of these items are more comparable to earnings estimates provided by securities analysts. This measure should not be considered an alternative to net income (loss) as defined by generally accepted accounting principles.
A reconciliation of earnings for the third quarter of 2017 stated without the effect of certain items to net income (loss) is shown below (in millions, except per share data):
3Q17 | |||||||
In millions |
Per diluted | ||||||
Net Income (loss) |
$ |
87 |
$ |
0.44 |
|||
Unrealized (gain) loss on derivative contracts |
34 |
0.17 |
|||||
Carryback of net operating losses |
(17) |
(0.09) |
|||||
Earnings stated without the effect of the above items |
104 |
0.52 |
|||||
Weighted-average number of shares outstanding for per diluted share |
200 |
Discretionary Cash Flow from Operations
Discretionary cash flow from operations represents net cash provided by operating activities before changes in operating assets and liabilities and is presented because of its acceptance as an indicator of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur additional debt. This measure should not be considered an alternative to net cash provided by operating activities as defined by generally accepted accounting principles.
A reconciliation of net cash provided by operating activities to discretionary cash flow from operations is shown below:
3Q17 | |||
(In millions) | |||
Net cash provided by operating activities |
$ |
173 |
|
Net changes in operating assets and liabilities |
89 |
||
Discretionary cash flow from operations |
262 |
View original content:http://www.prnewswire.com/news-releases/newfield-exploration-reports-third-quarter-2017-results-300546756.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Aug. 22, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) will host its third quarter 2017 earnings conference call at 10:00 a.m. (CDT), Wednesday, November 1, 2017. The Company plans to release its third quarter earnings after market close on October 31, 2017.
To participate in the conference call, please dial (719) 457-2641 and provide conference code 7914344 at least 10 minutes prior to the scheduled start time. In addition, a listen-only broadcast of the call also will be provided over the internet at http://www.newfield.com, under Investor Relations.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have oil assets offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
View original content:http://www.prnewswire.com/news-releases/newfield-provides-third-quarter-2017-conference-call-information-300508005.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Aug. 22, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) is scheduled to present at the following event:
Barclays Capital CEO Energy-Power Conference *
3:45 p.m. (Eastern), September 5, 2017
*A live webcast of the presentation will be made available through Newfield's website at http://www.newfield.com.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have oil assets offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
View original content:http://www.prnewswire.com/news-releases/newfield-exploration-to-present-at-upcoming-event-300507772.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Aug. 14, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today announced that effective August 11, 2017, Edgar R. "Bud" Giesinger, 60, a former managing and audit engagement partner, KPMG LLP, has been appointed to Newfield's Board of Directors. Following his appointment, Newfield's Board will be comprised of 10 directors, nine of whom are independent.
"Bud's 36 years of accounting and finance experience at KPMG will be an important asset to Newfield," said Lee K. Boothby, Newfield Chairman, President and CEO. "We look forward to his guidance not only around financial matters, but also the insight and experience he will contribute to strategy, legal and regulatory issues. Bud joins an active and engaged Board and we look forward to his immediate impact."
During his nearly four decades with KPMG, Giesinger was responsible for advising clients in accounting and financial matters, capital raising and international expansion, and with the Securities and Exchange Commission. As managing partner, he was responsible for the strategic direction, partner compensation, human resources and legal and regulatory affairs for the firm's Houston office. He also served on the nominating committee of KPMG's Board of Directors.
Giesinger serves on the Board of Solaris Oilfield Infrastructure, Inc. as audit committee chair and on the Board of Geospace Technologies Corporation where he serves on the audit, nominating and corporate governance and compensation committees.
Giesinger is a Certified Public Accountant and a member of the American Institute of Public Accountants and the Texas Society of Certified Public Accountants. He holds a B.B.A. in accounting from The University of Texas at Austin and is active in numerous professional and charitable organizations.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have oil assets offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
View original content:http://www.prnewswire.com/news-releases/newfield-exploration-company-announces-appointment-of-edgar-r-giesinger-to-board-of-directors-300504089.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Aug. 1, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today announced second quarter 2017 unaudited financial and operating results. Additional details can be found in the Company's @NFX publication, located on its website.
Newfield plans to host a conference call at 10 a.m. CDT on August 2, 2017. To listen to the call, please visit Newfield's website at http://www.newfield.com. To participate in the call, dial 719-457-2087 and provide conference code 3843455 at least 10 minutes prior to the scheduled start time.
Year-to-date 2017 Highlights
"We are on target to deliver the key objectives within our 2017 business plan and we expect to enter 2018 with strong momentum across the company," said Lee K. Boothby, Newfield Chairman, President and CEO. "We have streamlined our operations to improve our cost structure and margins and we are fortunate to have high-return plays to actively develop in today's commodity price environment. The advancements we are demonstrating in more mature development plays like SCOOP and the Bakken, are great examples of where we are headed in STACK. We have a deep drilling inventory of quality development opportunities to pursue over the next several decades and we continue to be encouraged by the prospectivity of other horizons on our acreage in the Anadarko Basin. With the exception of our contractor's recent mechanical issue in China, where we are hopeful that repairs will be completed by year-end, the year 2017 is shaping up to be another strong year of performance for Newfield."
Second Quarter 2017 Financial and Production Summary
For the second quarter, the Company recorded net income of $98 million, or $0.49 per diluted share (all per share amounts are on a diluted basis). After adjusting for the effect of unrealized derivative gains during the period, net income would have been $85 million, or $0.43 per share.
Revenues for the second quarter were $402 million. Net cash provided by operating activities was $300 million. Discretionary cash flow from operations was $215 million.
Newfield's total net production in the second quarter of 2017 was approximately 150,000 BOEPD, comprised of 44% oil, 18% natural gas liquids and 38% natural gas. Domestic production in the second quarter was approximately 141,000 BOEPD, comprised of 40% oil, 19% natural gas liquids and 41% natural gas.
2017e Production, Cost and Expense Guidance
Domestic |
China |
Total | |||||||||
Production |
|||||||||||
Oil % |
41% |
100% |
42% | ||||||||
NGLs % |
19% |
— |
19% | ||||||||
Natural Gas % |
40% |
— |
39% | ||||||||
Total (mboepd)1 |
145.4 - 153.8 |
4.0 |
149.4 - 157.8 | ||||||||
Expenses ($/boe)2 |
|||||||||||
LOE3,5 |
$ |
3.41 |
$ |
16.48 |
$ |
3.76 | |||||
Transportation4 |
5.58 |
— |
5.43 | ||||||||
Production & other taxes |
1.07 |
0.21 |
1.05 | ||||||||
General & administrative (G&A), net5 |
$ |
3.54 |
$ |
5.02 |
$ |
3.58 | |||||
Interest expense, gross |
— |
— |
2.66 | ||||||||
Capitalized interest and direct internal costs |
— |
— |
$ |
(2.20) | |||||||
Effective Tax rate |
0 - 5% |
0 - 5% |
0 - 5% |
1Total Company and China volumes include impact of Bohai Bay divestiture |
2Cost and expenses are expected to be within 5% of the estimates above |
3Total LOE includes recurring, major expense and non E&P operating expenses |
42017e transportation / processing fees include ~$52 million for Arkoma unused firm gas transportation and ~$33 million for Uinta oil and gas delivery shortfall fees |
5Total LOE and G&A includes $4 million and $4 million, respectively, associated with remainder of 2017 activity in China |
3Q17e Production, Cost and Expense Guidance
Domestic |
China |
Total | |||||||||
Production |
|||||||||||
Oil % |
41% |
— |
41% | ||||||||
NGLs % |
19% |
— |
19% | ||||||||
Natural Gas % |
40% |
— |
40% | ||||||||
Total (mboepd) |
151.0 - 157.7 |
— |
151.0 - 157.7 | ||||||||
Expenses ($/boe)1 |
|||||||||||
LOE4 |
$ |
3.26 |
— |
$ |
3.37 | ||||||
Transportation3 |
5.71 |
— |
5.71 | ||||||||
Production & other taxes |
1.14 |
— |
1.14 | ||||||||
General & administrative (G&A), net4 |
$ |
3.62 |
— |
$ |
3.76 | ||||||
Interest expense, gross |
— |
— |
2.63 | ||||||||
Capitalized interest and direct internal costs |
— |
— |
$ |
(2.15) | |||||||
Effective Tax rate |
0 - 5% |
0% |
0 - 5% |
1Cost and expenses are expected to be within 5% of the estimates above |
2Total LOE includes recurring, major expense and non E&P operating expenses |
33Q17e transportation / processing fees include ~$13 million for Arkoma unused firm gas transportation and ~$8 million for Uinta oil and gas delivery shortfall fees |
4Total LOE and G&A includes $2 million and $2 million, respectively, associated with Q3 2017 activity in China |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have oil assets offshore China.
**This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "forecast," "outlook," "could," "budget," "objectives," "strategy," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets, estimated future operating costs, expenses and other financial measures, estimated future tax rates, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although, as of the date of this release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks and no assurance can be given that such expectations will prove to have been correct. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, U.S. and China governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, new regulations or changes in tax or environmental legislation, environmental liabilities not covered by indemnity or insurance, legislation or regulatory initiatives intended to address seismic activity, and other operating risks. Please see Newfield's 2016 Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other subsequent public filings, all filed with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed in this press release or in Newfield's SEC filings could also have material adverse effects on Newfield's actual results as compared to its anticipated results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this release. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
2Q17 Actual | |||||||||||
2Q17 Actual Results |
Domestic |
China |
Total | ||||||||
Production/Liftings(1) |
|||||||||||
Crude oil and condensate (MBbls) |
5,132 |
830 |
5,962 |
||||||||
Natural gas (Bcf) |
31.2 |
— |
31.2 |
||||||||
NGLs (MBbls) |
2,491 |
— |
2,491 |
||||||||
Total (MBOE) |
12,818 |
830 |
13,648 |
||||||||
Average Realized Prices(2)(3) |
|||||||||||
Crude oil and condensate (per Bbl) |
$ |
46.46 |
$ |
49.01 |
$ |
46.81 |
|||||
Natural gas (per Mcf) |
2.61 |
— |
2.61 |
||||||||
NGLs (per Bbl) |
24.54 |
— |
24.54 |
||||||||
Crude oil equivalent (per BOE) |
$ |
29.93 |
$ |
49.01 |
$ |
31.11 |
|||||
Operating Expenses:(3) |
|||||||||||
Lease operating (in millions) |
|||||||||||
Recurring |
$ |
39 |
$ |
11 |
$ |
50 |
|||||
Major (workovers, etc.) |
$ |
6 |
$ |
2 |
$ |
8 |
|||||
Lease operating (per BOE) |
|||||||||||
Recurring |
$ |
3.09 |
$ |
13.18 |
$ |
3.72 |
|||||
Major (workovers, etc.) |
$ |
0.43 |
$ |
1.98 |
$ |
0.52 |
|||||
Transportation and processing (in millions) |
$ |
71 |
$ |
— |
$ |
71 |
|||||
per BOE |
$ |
5.67 |
$ |
— |
$ |
5.32 |
|||||
Production and other taxes (in millions) |
$ |
13 |
$ |
— |
$ |
13 |
|||||
per BOE |
$ |
1.03 |
$ |
0.14 |
$ |
0.97 |
|||||
General and administrative (G&A), net (in millions) |
$ |
49 |
$ |
2 |
$ |
51 |
|||||
per BOE |
$ |
3.90 |
$ |
2.13 |
$ |
3.79 |
|||||
Capitalized direct internal costs (in millions) |
$ |
(16) |
|||||||||
per BOE |
$ |
(1.19) |
|||||||||
Other operating expenses (income), net (in millions) |
$ |
— |
|||||||||
per BOE |
$ |
0.02 |
|||||||||
Interest expense (in millions) |
$ |
37 |
|||||||||
per BOE |
$ |
2.78 |
|||||||||
Capitalized interest (in millions) |
$ |
(15) |
|||||||||
per BOE |
$ |
(1.15) |
|||||||||
Other non-operating (income) expense (in millions) |
$ |
(2) |
|||||||||
per BOE |
$ |
(0.14) |
(1) |
Represents volumes lifted and sold regardless of when produced. Includes natural gas produced and consumed in operations of 1.2 Bcf during the three months ended June 30, 2017. | ||||
(2) |
Average realized prices include the effects of derivative contracts. Excluding these effects, the average realized price for domestic and total natural gas would have been $2.75 per Mcf and the average realized price for our domestic and total crude oil and condensate would have been $42.52 per barrel and $43.42 per barrel, respectively. We did not have any derivative contracts associated with our NGL or China production as of June 30, 2017. | ||||
(3) |
All per unit pricing and expenses exclude natural gas produced and consumed in operations. |
CONDENSED CONSOLIDATED BALANCE SHEET | |||||||
(Unaudited, in millions) | |||||||
June 30, |
December 31, | ||||||
2017 |
2016 | ||||||
ASSETS | |||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ |
522 |
$ |
555 |
|||
Short-term investments |
25 |
25 |
|||||
Derivative assets |
33 |
75 |
|||||
Other current assets |
303 |
294 |
|||||
Total current assets |
883 |
949 |
|||||
Oil and gas properties, net (full cost method) |
3,479 |
3,140 |
|||||
Derivative assets |
1 |
— |
|||||
Other assets |
232 |
223 |
|||||
Total assets |
$ |
4,595 |
$ |
4,312 |
|||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: |
|||||||
Derivative liabilities |
$ |
13 |
$ |
97 |
|||
Other current liabilities |
665 |
587 |
|||||
Total current liabilities |
678 |
684 |
|||||
Other liabilities |
67 |
63 |
|||||
Derivative liabilities |
— |
3 |
|||||
Long-term debt |
2,432 |
2,431 |
|||||
Asset retirement obligations |
156 |
154 |
|||||
Deferred taxes |
55 |
39 |
|||||
Total long-term liabilities |
2,710 |
2,690 |
|||||
Stockholders' equity: |
|||||||
Common stock, treasury stock and additional paid-in capital |
3,228 |
3,205 |
|||||
Accumulated other comprehensive income (loss) |
(1) |
(2) |
|||||
Retained earnings (deficit) |
(2,020) |
(2,265) |
|||||
Total stockholders' equity |
1,207 |
938 |
|||||
Total liabilities and stockholders' equity |
$ |
4,595 |
$ |
4,312 |
CONSOLIDATED STATEMENT OF OPERATIONS | |||||||||||||||
(Unaudited, in millions, except per share data) | |||||||||||||||
Three Months Ended |
Six Months Ended | ||||||||||||||
June 30, |
June 30, | ||||||||||||||
2017 |
2016 |
2017 |
2016 | ||||||||||||
Oil, gas and NGL revenues |
$ |
402 |
$ |
381 |
$ |
819 |
$ |
665 |
|||||||
Operating expenses: |
|||||||||||||||
Lease operating |
58 |
62 |
114 |
123 |
|||||||||||
Transportation and processing |
71 |
66 |
143 |
129 |
|||||||||||
Production and other taxes |
13 |
11 |
27 |
21 |
|||||||||||
Depreciation, depletion and amortization |
110 |
160 |
216 |
337 |
|||||||||||
General and administrative |
51 |
58 |
98 |
102 |
|||||||||||
Ceiling test and other impairments |
— |
522 |
— |
1,028 |
|||||||||||
Other |
— |
— |
1 |
1 |
|||||||||||
Total operating expenses |
303 |
879 |
599 |
1,741 |
|||||||||||
Income (loss) from operations |
99 |
(498) |
220 |
(1,076) |
|||||||||||
Other income (expense): |
|||||||||||||||
Interest expense |
(37) |
(38) |
(75) |
(79) |
|||||||||||
Capitalized interest |
15 |
11 |
31 |
20 |
|||||||||||
Commodity derivative income (expense) |
28 |
(133) |
81 |
(150) |
|||||||||||
Other, net |
2 |
— |
4 |
1 |
|||||||||||
Total other income (expense) |
8 |
(160) |
41 |
(208) |
|||||||||||
Income (loss) before income taxes |
107 |
(658) |
261 |
(1,284) |
|||||||||||
Income tax provision (benefit) |
9 |
9 |
16 |
7 |
|||||||||||
Net income (loss) |
$ |
98 |
$ |
(667) |
$ |
245 |
$ |
(1,291) |
|||||||
Earnings (loss) per share: |
|||||||||||||||
Basic |
$ |
0.49 |
$ |
(3.36) |
$ |
1.23 |
$ |
(6.87) |
|||||||
Diluted |
$ |
0.49 |
$ |
(3.36) |
$ |
1.22 |
$ |
(6.87) |
|||||||
Weighted-average number of shares outstanding for basic earnings (loss) per share |
199 |
198 |
199 |
188 |
|||||||||||
Weighted-average number of shares outstanding for diluted earnings (loss) per share |
200 |
198 |
200 |
188 |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | |||||||
(Unaudited, in millions) | |||||||
Six Months Ended | |||||||
June 30, | |||||||
2017 |
2016 | ||||||
Cash flows from operating activities: |
|||||||
Net income (loss) |
$ |
245 |
$ |
(1,291) |
|||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|||||||
Depreciation, depletion and amortization |
216 |
337 |
|||||
Deferred tax provision (benefit) |
16 |
3 |
|||||
Stock-based compensation |
20 |
19 |
|||||
Unrealized (gain) loss on derivative contracts |
(46) |
296 |
|||||
Ceiling test and other impairments |
— |
1,028 |
|||||
Other, net |
7 |
6 |
|||||
458 |
398 |
||||||
Changes in operating assets and liabilities |
9 |
(20) |
|||||
Net cash provided by (used in) operating activities |
467 |
378 |
|||||
Cash flows from investing activities: |
|||||||
Additions to and acquisitions of oil and gas properties and other |
(521) |
(974) |
|||||
Proceeds from sales of oil and gas properties |
28 |
29 |
|||||
Net cash provided by (used in) investing activities |
(493) |
(945) |
|||||
Cash flows from financing activities: |
|||||||
Net proceeds (repayments) of borrowings under credit arrangements |
— |
(39) |
|||||
Proceeds from issuances of common stock, net |
2 |
777 |
|||||
Other, net |
(9) |
(11) |
|||||
Net cash provided by (used in) financing activities |
(7) |
727 |
|||||
Increase (decrease) in cash and cash equivalents |
(33) |
160 |
|||||
Cash and cash equivalents, beginning of period |
555 |
5 |
|||||
Cash and cash equivalents, end of period |
$ |
522 |
$ |
165 |
Explanation and Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Earnings Stated Without the Effect of Certain Items)
Earnings stated without the effect of certain items is a non-GAAP financial measure. Earnings without the effect of these items are presented because they affect the comparability of operating results from period to period. In addition, earnings without the effect of these items are more comparable to earnings estimates provided by securities analysts. This measure should not be considered an alternative to net income (loss) as defined by generally accepted accounting principles.
A reconciliation of earnings for the second quarter of 2017 stated without the effect of certain items to net income (loss) is shown below:
2Q17 | |||
(In millions) | |||
Net Income (loss) |
$ |
98 | |
Unrealized (gain) loss on derivative contracts |
(13) | ||
Earnings stated without the effect of the above items |
85 |
Discretionary Cash Flow from Operations
Discretionary cash flow from operations represents net cash provided by operating activities before changes in operating assets and liabilities and is presented because of its acceptance as an indicator of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur additional debt. This measure should not be considered an alternative to net cash provided by operating activities as defined by generally accepted accounting principles.
A reconciliation of net cash provided by operating activities to discretionary cash flow from operations is shown below:
2Q17 | |||
(In millions) | |||
Net cash provided by operating activities |
$ |
300 |
|
Net changes in operating assets and liabilities |
(85) |
||
Discretionary cash flow from operations |
215 |
View original content:http://www.prnewswire.com/news-releases/newfield-exploration-reports-second-quarter-2017-results-300497810.html
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, June 20, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) is scheduled to present at the following event. A live webcast of the presentation will be made available through Newfield's website at http://www.newfield.com.
J.P. Morgan Energy Equity Investor Conference
10:00 a.m. (Eastern), June 28, 2017
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have oil producing assets offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, May 16, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) is scheduled to present at the following event. A live webcast of the presentation will be made available through Newfield's website at http://www.newfield.com.
UBS Global Oil and Gas Conference
10:35 a.m. (Central), May 24, 2017
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have oil producing assets offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, May 2, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today announced first quarter 2017 unaudited financial and operating results. Additional details can be found in the Company's @NFX publication, located on its website.
Newfield plans to host a conference call at 10 a.m. CDT on May 3, 2017. To listen to the call, please visit Newfield's website at http://www.newfield.com. To participate in the call, dial 719-325-2142 and provide conference code 9380687 at least 10 minutes prior to the scheduled start time.
Year-to-date 2017 Highlights
"As you can see from our first quarter results, we are off to a great start in 2017 and building momentum that should carry into 2018 and beyond," said Lee K. Boothby, Newfield Chairman, President and CEO. "We remain confident that our near-term business plan is aligned with today's market realities. Our plan was carefully constructed to achieve several important objectives... to set the organization on a course to balance investments with cash flow while sustainably delivering double-digit production growth in the future, advance our learning curve in STACK through enhanced completions and initial infill drilling on multi-well pads, assess our SCORE program which includes several liquids-rich targets on our acreage and timely identify and mitigate potential bottlenecks to future development plans."
First Quarter 2017 Financial and Production Summary
For the first quarter, the Company recorded net income of $147 million, or $0.73 per diluted share (all per share amounts are on a diluted basis). After adjusting for the effect of unrealized derivative gains during the period, net income would have been $114 million, or $0.57 per share.
Revenues for the first quarter were $417 million. Net cash provided by operating activities was $167 million. Discretionary cash flow from operations was $243 million.
Newfield's total net production in the first quarter of 2017 was 145,978 BOEPD, comprised of 43% oil, 19% natural gas liquids and 38% natural gas. Domestic production in the first quarter was 138,833 BOEPD, comprised of 40% oil, 20% natural gas liquids and 40% natural gas.
2017e Production, Cost and Expense Guidance | |||||
Domestic |
China |
Total | |||
Production |
|||||
Oil % |
41% |
100% |
44% | ||
NGLs % |
19% |
– |
18% | ||
Natural Gas % |
40% |
– |
38% | ||
Total (mboepd)1 |
143.4 – 153.8 |
6.0 – 7.0 |
149.4 – 160.8 | ||
Expenses ($/boe)2 |
|||||
LOE3 |
$3.44 |
$15.85 |
$3.98 | ||
Transportation4 |
5.59 |
– |
5.35 | ||
Production & other taxes |
1.05 |
0.15 |
1.01 | ||
General & administrative (G&A), net |
$3.40 |
$3.35 |
$3.40 | ||
Interest expense, gross |
– |
– |
2.64 | ||
Capitalized interest and direct internal costs |
– |
– |
($2.18) | ||
Effective Tax rate5 |
0 – 5% |
15 – 20% |
5 – 10% |
1Total Company and China volumes assume mid-year 2017 Bohai Bay divestiture close |
2Cost and expenses are expected to be within 5% of the estimates above |
3Total LOE includes recurring, major expense and non E&P operating expenses |
42017e transportation / processing fees include ~$52 million Arkoma unused firm gas transportation and ~$37 million Uinta oil and gas delivery shortfall fees |
5Estimated China tax rate reflects a 25% taxation in-country |
2Q17e Production, Cost and Expense Guidance | |||||
Domestic |
China |
Total | |||
Production |
|||||
Oil % |
40% |
100% |
44% | ||
NGLs % |
19% |
– |
18% | ||
Natural Gas % |
41% |
– |
38% | ||
Total (mboepd) |
134.1 – 140.1 |
8.5 – 9.0 |
142.6 – 149.1 | ||
Expenses ($/boe)1 |
|||||
LOE2 |
$3.66 |
$16.69 |
$4.45 | ||
Transportation3 |
5.83 |
– |
5.48 | ||
Production & other taxes |
1.09 |
0.14 |
1.03 | ||
General & administrative (G&A), net |
$3.86 |
2.88 |
$3.81 | ||
Interest expense, gross |
– |
– |
2.81 | ||
Capitalized interest and direct internal costs |
– |
– |
($2.34) | ||
Effective Tax rate4 |
0 – 5% |
20 – 25% |
5 – 10% |
1Cost and expenses are expected to be within 5% of the estimates above |
2Total LOE includes recurring, major expense and non E&P operating expenses |
32Q17e transportation / processing fees include ~$13 million Arkoma unused firm gas transportation and ~$9 million Uinta oil and gas delivery shortfall fees |
4Estimated China tax rate reflects a 25% taxation in-country |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have oil producing assets offshore China.
**This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "forecast," "outlook," "could," "budget," "objectives," "strategy," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although, as of the date of this release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, U.S. and China governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, new regulations or changes in tax or environmental legislation, environmental liabilities not covered by indemnity or insurance, legislation or regulatory initiatives intended to address seismic activity, and other operating risks. Please see Newfield's 2016 Annual Report on Form 10-K, Q1 2017 Quarterly Report on Form 10-Q and subsequent public filings, all filed with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed in this press release or in Newfield's SEC filings could also have material adverse effects on Newfield's actual results as compared to its anticipated results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this release. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
1Q17 Actual Results |
Domestic |
China |
Total | ||||||||
Production/Liftings(1) |
|||||||||||
Crude oil and condensate (MMBbls) |
5.0 |
0.6 |
5.6 |
||||||||
Natural gas (Bcf) |
30.3 |
— |
30.3 |
||||||||
NGLs (MMBbls) |
2.5 |
— |
2.5 |
||||||||
Total (MMBOE) |
12.5 |
0.6 |
13.1 |
||||||||
Average Realized Prices(2)(3) |
|||||||||||
Crude oil and condensate (per Bbl) |
$ |
51.15 |
$ |
53.21 |
$ |
51.38 |
|||||
Natural gas (per Mcf) |
2.72 |
— |
2.72 |
||||||||
NGLs (per Bbl) |
27.03 |
— |
27.03 |
||||||||
Crude oil equivalent (per BOE) |
$ |
32.53 |
$ |
53.21 |
$ |
33.55 |
|||||
Operating Expenses:(3) |
|||||||||||
Lease operating (in millions) |
|||||||||||
Recurring |
$ |
42 |
$ |
8 |
$ |
50 |
|||||
Major (workovers, etc.) |
$ |
6 |
$ |
— |
$ |
6 |
|||||
Lease operating (per BOE) |
|||||||||||
Recurring |
$ |
3.46 |
$ |
12.12 |
$ |
3.89 |
|||||
Major (workovers, etc.) |
$ |
0.47 |
$ |
0.23 |
$ |
0.46 |
|||||
Transportation and processing (in millions) |
$ |
72 |
$ |
— |
$ |
72 |
|||||
per BOE |
$ |
5.81 |
$ |
— |
$ |
5.52 |
|||||
Production and other taxes (in millions) |
$ |
14 |
$ |
— |
$ |
14 |
|||||
per BOE |
$ |
1.10 |
$ |
0.24 |
$ |
1.06 |
|||||
General and administrative (G&A), net (in millions) |
$ |
46 |
$ |
1 |
$ |
47 |
|||||
per BOE |
$ |
3.70 |
$ |
2.06 |
$ |
3.62 |
|||||
Capitalized direct internal costs (in millions) |
$ |
(17) |
|||||||||
per BOE |
$ |
(1.32) |
|||||||||
Other operating expenses (income), net (in millions) |
$ |
1 |
|||||||||
per BOE |
$ |
0.09 |
|||||||||
Interest expense (in millions) |
$ |
38 |
|||||||||
per BOE |
$ |
2.89 |
|||||||||
Capitalized interest (in millions) |
$ |
(16) |
|||||||||
per BOE |
$ |
(1.20) |
|||||||||
Other non-operating (income) expense (in millions) |
$ |
(2) |
|||||||||
per BOE |
$ |
(0.17) |
_____ |
|
(1) |
Represents volumes lifted and sold regardless of when produced. Includes natural gas produced and consumed in operations of 0.9 Bcf during the three months ended March 31, 2017. |
(2) |
Average realized prices include the effects of derivative contracts. Excluding these effects, the average realized price for domestic and total natural gas would have been $2.93 per Mcf and the average realized price for our domestic and total crude oil and condensate would have been $45.97 per barrel and $46.79 per barrel, respectively. We did not have any derivative contracts associated with our NGL or China production as of March 31, 2017. |
(3) |
All per unit pricing and expenses exclude natural gas produced and consumed in operations. |
CONDENSED CONSOLIDATED BALANCE SHEET |
|||||||
(Unaudited, in millions) |
|||||||
March 31, |
December 31, | ||||||
2017 |
2016 | ||||||
ASSETS | |||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ |
469 |
$ |
555 |
|||
Short-term investments |
25 |
25 |
|||||
Derivative assets |
52 |
75 |
|||||
Other current assets |
319 |
294 |
|||||
Total current assets |
865 |
949 |
|||||
Oil and gas properties, net (full cost method) |
3,294 |
3,140 |
|||||
Derivative assets |
2 |
— |
|||||
Other assets |
227 |
223 |
|||||
Total assets |
$ |
4,388 |
$ |
4,312 |
|||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: |
|||||||
Derivative liabilities |
$ |
46 |
$ |
97 |
|||
Other current liabilities |
537 |
587 |
|||||
Total current liabilities |
583 |
684 |
|||||
Other liabilities |
65 |
63 |
|||||
Derivative liabilities |
— |
3 |
|||||
Long-term debt |
2,432 |
2,431 |
|||||
Asset retirement obligations |
160 |
154 |
|||||
Deferred taxes |
48 |
39 |
|||||
Total long-term liabilities |
2,705 |
2,690 |
|||||
Stockholders' equity: |
|||||||
Common stock, treasury stock and additional paid-in capital |
3,220 |
3,205 |
|||||
Accumulated other comprehensive gain (loss) |
(2) |
(2) |
|||||
Retained earnings (deficit) |
(2,118) |
(2,265) |
|||||
Total stockholders' equity |
1,100 |
938 |
|||||
Total liabilities and stockholders' equity |
$ |
4,388 |
$ |
4,312 |
CONSOLIDATED STATEMENT OF OPERATIONS |
|||||||
(Unaudited, in millions, except per share data) |
|||||||
Three Months Ended | |||||||
March 31, | |||||||
2017 |
2016 | ||||||
Oil, gas and NGL revenues |
$ |
417 |
$ |
284 |
|||
Operating expenses: |
|||||||
Lease operating |
56 |
61 |
|||||
Transportation and processing |
72 |
63 |
|||||
Production and other taxes |
14 |
10 |
|||||
Depreciation, depletion and amortization |
106 |
177 |
|||||
General and administrative |
47 |
44 |
|||||
Ceiling test and other impairments |
— |
506 |
|||||
Other |
1 |
1 |
|||||
Total operating expenses |
296 |
862 |
|||||
Income (loss) from operations |
121 |
(578) |
|||||
Other income (expense): |
|||||||
Interest expense |
(38) |
(41) |
|||||
Capitalized interest |
16 |
9 |
|||||
Commodity derivative income (expense) |
53 |
(17) |
|||||
Other, net |
2 |
1 |
|||||
Total other income (expense) |
33 |
(48) |
|||||
Income (loss) before income taxes |
154 |
(626) |
|||||
Income tax provision (benefit) |
7 |
(2) |
|||||
Net income (loss) |
$ |
147 |
$ |
(624) |
|||
Earnings (loss) per share: |
|||||||
Basic |
$ |
0.74 |
$ |
(3.52) |
|||
Diluted |
$ |
0.73 |
$ |
(3.52) |
|||
Weighted-average number of shares outstanding for basic earnings (loss) per share |
199 |
177 |
|||||
Weighted-average number of shares outstanding for diluted earnings (loss) per share |
200 |
177 |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS |
|||||||
(Unaudited, in millions) |
|||||||
Three Months Ended | |||||||
March 31, | |||||||
2017 |
2016 | ||||||
Cash flows from operating activities: |
|||||||
Net income (loss) |
$ |
147 |
$ |
(624) |
|||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|||||||
Depreciation, depletion and amortization |
106 |
177 |
|||||
Deferred tax provision (benefit) |
9 |
— |
|||||
Stock-based compensation |
12 |
8 |
|||||
Unrealized (gain) loss on derivative contracts |
(33) |
99 |
|||||
Ceiling test and other impairments |
— |
506 |
|||||
Other, net |
2 |
4 |
|||||
243 |
170 |
||||||
Changes in operating assets and liabilities |
(76) |
(98) |
|||||
Net cash provided by (used in) operating activities |
167 |
72 |
|||||
Cash flows from investing activities: |
|||||||
Additions to and acquisitions of oil and gas properties and other |
(246) |
(278) |
|||||
Proceeds (purchase price adjustments) from sales of oil and gas properties
|
(5) |
3 |
|||||
Net cash provided by (used in) investing activities |
(251) |
(275) |
|||||
Cash flows from financing activities: |
|||||||
Net proceeds (repayments) of borrowings under credit arrangements |
— |
(39) |
|||||
Proceeds from issuances of common stock, net |
— |
776 |
|||||
Other, net |
(2) |
(2) |
|||||
Net cash provided by (used in) financing activities |
(2) |
735 |
|||||
Increase (decrease) in cash and cash equivalents |
(86) |
532 |
|||||
Cash and cash equivalents, beginning of period |
555 |
5 |
|||||
Cash and cash equivalents, end of period |
$ |
469 |
$ |
537 |
Explanation and Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Earnings Stated Without the Effect of Certain Items)
Earnings stated without the effect of certain items is a non-GAAP financial measure. Earnings without the effect of these items are presented because they affect the comparability of operating results from period to period. In addition, earnings without the effect of these items are more comparable to earnings estimates provided by securities analysts. This measure should not be considered an alternative to net income (loss) as defined by generally accepted accounting principles.
A reconciliation of earnings for the first quarter of 2017 stated without the effect of certain items to net income (loss) is shown below:
1Q17 | |||
(In millions) | |||
Net Income (loss) |
$ |
147 |
|
Unrealized (gain) loss on derivative contracts |
(33) |
||
Earnings stated without the effect of the above items |
114 |
Discretionary Cash Flow from Operations
Discretionary cash flow from operations represents net cash provided by operating activities before changes in operating assets and liabilities and is presented because of its acceptance as an indicator of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur additional debt. This measure should not be considered an alternative to net cash provided by operating activities as defined by generally accepted accounting principles.
A reconciliation of net cash provided by operating activities to discretionary cash flow from operations is shown below:
1Q17 | |||
(In millions) | |||
Net cash provided by operating activities |
$ |
167 |
|
Net changes in operating assets and liabilities |
76 |
||
Discretionary cash flow from operations |
243 |
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, March 30, 2017 /PRNewswire/-- Newfield Exploration Company (NYSE: NFX) today announced it has broken ground on a water recycling facility located in its STACK play in the Anadarko Basin (Kingfisher County, Oklahoma). The complex, named the Barton Water Recycle Facility, is expected to process approximately 30,000 barrels of water per day (BWPD) upon completion early in the third quarter of 2017.
"The new Barton facility will be capable of recycling both the flowback and produced water currently generated from our STACK wells and hydraulic fracturing operations," said Newfield Chairman Lee K. Boothby. "Today's innovative technologies are allowing us to more cost-effectively recycle and reuse the water we produce from our operations. This is good for our economics and good for the environment," added Boothby.
The Barton facility will utilize aerated biologic treatment technology to convert produced water into recycled water for hydraulic fracturing operations. The treatment process uses natural and enhanced bioremediation, or good bacteria and nutrients, to separate and breakdown any existing impurities that may be contained in the produced water. The end result is a high-quality water primarily free of impurities—very similar to what is initially found in the reservoir rock.
"The time when the procurement and disposal of water in oil and gas operations was viewed as routine is over," said Chairman Dana Murphy, Oklahoma Corporate Commission. "Water has now become an absolutely critical component that demands careful planning for environmental, conservation and business reasons. This facility is a step in the continuing evolution of the industry."
Newfield has invested more than $40 million to date in water management infrastructure in its STACK play. The new recycling facility is a multi-million dollar investment located on a 30-acre site and will connect to seven pits with nearly 6.5 million barrels of storage capacity utilizing more than 70 miles of underground pipeline by the end of 2017.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on liquids-rich U.S. resource plays and our principal areas of operation include Oklahoma, Utah and North Dakota. We also have offshore oil developments in China.
For additional information, please contact Newfield's Communications department.
Phone: 281-210-5253
Email: chassler@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, March 27, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) in conjunction with the Company's participation in this week's Scotia Howard Weil Energy Conference, today provided an interim update on its recent enhanced completions in the Anadarko Basin's STACK play and raised expectations for its first quarter 2017 domestic production. Additional slides are available on the Company's website at www.newfield.com.
In STACK, Newfield disclosed results from a new, industry leading STACK well and updated results from recent upsized well completions. The Burgess well (4,859' lateral length), located in Kingfisher County, Oklahoma and the heart of the Company's more than 300,000 net STACK acres, achieved a 24-hour flow rate of 2,931 BOEPD (69% oil) and a 20-day average rate of 2,492 BOEPD (70% oil). When compared against publicly available industry data, the Burgess achieved record 24-hour oil production per 1,000' of gross perforated interval (1,000' GPI) --- or 417 barrels of oil per 1,000' GPI. The well also had a record 20-day average oil production rate of 361 barrels per 1,000' GPI. These rates are the highest oil production rates per 1,000' GPI publicly reported to date in SCOOP and STACK.
The Burgess is one of 16 recent wells with enhanced completion designs. Newfield updated results for the nine previously disclosed STACK wells (February 2017) and provided early production rates for an additional seven wells with enhanced completions. Five of the wells now have 90 days of production history, averaging 1,215 BOEPD (65% oil), which is more than 40% above the Company's 1.1 MMBOE gross type curve when normalized to 10,000' lateral length. Newfield is gathering significant new data in 2017 and the results will ultimately be used to appropriately describe its development well type curve in STACK.
With recent outperformance in the Anadarko Basin and its other producing regions, Newfield expects that its first quarter 2017 production will likely exceed the high-end of guidance. Domestic production is expected to average approximately 137,700 BOEPD, or 3,500 BOEPD above original guidance (132,000 – 134,200 BOEPD).
"Our recent results from enhanced completions provide us with confidence around our near term plans, as well as the future productivity of STACK, said Lee K. Boothby, Newfield Chairman, President and CEO. "The year 2017 is critical for us. We are rich in catalysts as we test development well densities, optimize our completions and explore exciting new stacked pay potential across our vast Anadarko Basin acreage position. STACK is the foundation for our future transition to a Company that can sustainably grow its production by double-digits within cash flow… even if today's oil prices persist. We are off to a roaring start in 2017 and we look forward to updating our stockholders on the execution of our business plan as the year progresses."
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have oil producing assets offshore China.
**This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "forecast," "outlook," "could," "budget," "objectives," "strategy," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, China and U.S. governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, new regulations or changes in tax legislation, environmental liabilities not covered by indemnity or insurance, legislation or regulatory initiatives intended to address seismic activity, and other operating risks. Please see Newfield's 2016 Annual Report on Form 10-K and subsequent public filings, all filed with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed in this press release or in Newfield's SEC filings could also have material adverse effects on forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, March 14, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) will host its first quarter 2017 earnings conference call at 10:00 a.m. (CDT), Wednesday, May 3, 2017. The Company plans to release its first quarter earnings after market close on May 2, 2017.
To participate in the conference call, please dial (719) 325-2142 and enter conference code 9380687 at least 10 minutes prior to the scheduled start time. In addition, a listen-only broadcast of the call also will be provided over the internet at http://www.newfield.com, under Investor Relations.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We focus on U.S. resource plays and our principal areas of operation include the Mid-Continent and the Rocky Mountains. We also have offshore oil developments in China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Feb. 21, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today provided its 2017 capital plan and a multi-year production growth outlook for the Company, driven by its industry-leading position in the SCOOP and STACK plays in the Anadarko Basin of Oklahoma. Newfield plans to host a conference call with analysts and investors at 10 a.m. CST, February 22. Additional information is provided through the @NFX publication, located on its website at www.newfield.com.
"We are excited about the future of our Company and the profitable oil growth trajectory that we are disclosing today," said Lee K. Boothby, Newfield Chairman, President and CEO. "Our focus has now shifted to development as we plan to aggressively attack our SCOOP and STACK plays to accelerate value creation for our stockholders.
"Our confidence in the Anadarko Basin has allowed us to outline a 2017 – 19 forecast with industry leading liquids growth. Our oil growth will largely be driven by the rapid development of our legacy STACK acreage in the heart of the play's oil window. Our production outlook includes a relatively static rig count of about 10 operated rigs. As oil prices improve, we have the organizational capacity and the financial resources to further accelerate our activity levels in the future."
The highlights of our plan are outlined below and additional slides can be found in the @NFX publication:
Plan Highlights:
2017e Production, Cost and Expense Guidance
Domestic |
China |
Total |
||||
Production |
||||||
Oil % |
40% |
100% |
43% |
|||
NGLs % |
20% |
– |
19% |
|||
Natural Gas % |
40% |
– |
38% |
|||
Total (mboepd)1 |
142.5 – 145.5 |
5.7 – 6.0 |
148.2 – 151.5 |
|||
Expenses ($/boe)2 |
||||||
LOE3 |
$3.43 |
$17.48 |
$3.97 |
|||
Transportation4 |
5.62 |
– |
5.40 |
|||
Production & other taxes |
1.16 |
0.17 |
1.12 |
|||
General & administrative (G&A), net |
$3.42 |
$4.18 |
$3.45 |
|||
Interest expense, gross |
– |
– |
2.73 |
|||
Capitalized interest and direct internal costs |
– |
– |
($2.25) |
|||
Effective Tax rate5 |
0 – 5% |
0 – 5% |
0 – 5% |
|||
1Total Company and China volumes assume mid-year 2017 Bohai Bay divestiture close |
2Cost and expenses are expected to be within 5% of the estimates above |
3Total LOE includes recurring, major expense and non E&P operating expenses |
42017e transportation / processing fees include ~$48.3 million Arkoma unused firm gas transportation and ~$36.8 million Uinta oil and gas delivery shortfall fees |
5Estimated China tax rate reflects a 25% taxation in-country |
1Q17e Production, Cost and Expense Guidance
Domestic |
China |
Total |
||||
Production |
||||||
Oil % |
40% |
100% |
44% |
|||
NGLs % |
19% |
– |
18% |
|||
Natural Gas % |
41% |
– |
38% |
|||
Total (mboepd) |
132.0 – 134.2 |
6.5 – 7.5 |
138.5 – 141.7 |
|||
Expenses ($/boe)1 |
||||||
LOE2 |
$3.80 |
$13.33 |
$4.28 |
|||
Transportation3 |
5.89 |
– |
5.60 |
|||
Production & other taxes |
1.18 |
0.22 |
1.13 |
|||
General & administrative (G&A), net |
$3.76 |
3.29 |
$3.74 |
|||
Interest expense, gross |
– |
– |
2.98 |
|||
Capitalized interest and direct internal costs |
– |
– |
($2.41) |
|||
Effective Tax rate4 |
0 – 5% |
20 – 25% |
0 – 5% |
|||
1Cost and expenses are expected to be within 5% of the estimates above |
2Total LOE includes recurring, major expense and non E&P operating expenses |
31Q17e transportation / processing fees include ~$12.4 million Arkoma unused firm gas transportation and ~$9.0 million Uinta oil and gas delivery shortfall fees |
4Estimated China tax rate reflects a 25% taxation in-country |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have oil producing assets offshore China.
Note 1 - Net unrisked resource depends on the availability of capital, regulatory approvals, commodity prices, costs, actual drilling results and other factors. Such amounts do not meet SEC rules and guidelines, may not be reflective of SEC proved reserves and do not equate to or predict any level of reserves or production
**This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "forecast," "outlook," "could," "budget," "objectives," "strategy," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, China and U.S. governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, new regulations or changes in tax legislation, environmental liabilities not covered by indemnity or insurance, legislation or regulatory initiatives intended to address seismic activity, and other operating risks. Please see Newfield's 2016 Annual Report on Form 10-K and subsequent public filings, all filed with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed in this press release or in Newfield's SEC filings could also have material adverse effects on forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Feb. 21, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today reported its fourth quarter 2016 financial results, as well as 2016 year-end proved reserves. Additional operational details can be found in the Company's @NFX publication, located on its website. Newfield today issued a separate news release outlining its planned 2017 capital investment program and full-year production expectations. In addition, the Company provided a multi-year outlook for domestic total production, domestic oil production and Anadarko Basin production.
Newfield will host a conference call at 10 a.m. CST, February 22, 2017. To listen to the call, please visit Newfield's website at http://www.newfield.com. To participate in the call, dial 785-830-1924 and enter conference code 5209429 at least 10 minutes prior to the scheduled start time.
Fourth Quarter Financial Summary
For the fourth quarter, the Company recorded net income of $13 million, or $0.07 per diluted share (all per share amounts are on a diluted basis). After adjusting for the effect of unrealized derivative losses, net income would have been $98 million, or $0.49 per share.
Revenues for the fourth quarter were $415 million. Net cash provided by operating activities was $239 million. Discretionary cash flow from operations was $229 million.
Fourth Quarter and Full-Year 2016 Production Summary
Newfield's total net production in the fourth quarter of 2016 was 13.9 MMBOE, comprised of 44% oil, 18% natural gas liquids and 38% natural gas. Domestic net production in the fourth quarter was 12.7 MMBOE, comprised of 39% oil, 20% natural gas liquids and 41% natural gas.
For the full-year 2016, Newfield's net production was 59.6 MMBOE, of which 5.4 MMBOE was from offshore China.
Proved Reserves and Costs Incurred
Newfield's year-end 2016 proved reserves were up 1% year-over-year to 513 MMBOE (99% domestic) despite the impact of lower crude oil and natural gas prices used in year-end reserve calculations. Crude oil and natural gas prices used in this calculation were $42.82 per barrel (down 15%) and $2.48 per MMbtu (down 4%), respectively. As a result, pre-tax present value of reserves (discounted at 10%) at year-end 2016 was approximately $2.7 billion, down 9% over the prior year-end.
The increase in our proved reserves of 4 MMBOE resulted from positive revisions of 36 MMBOE and cost structure improvement revisions of 7 MMBOE which were partially offset by negative revisions of 22 MMBOE resulting from commodity price decreases. During 2016, we added proved reserves of 77 MMBOE, which included 35 MMBOE of reserves purchased and 42 MMBOE added through extensions, discoveries and other additions. During 2016, we sold non-strategic assets with reserves of 35 MMBOE.
Approximately 56% of proved reserves are liquids and 61% are proved developed. The largest source of reserve additions during 2016 came from the Anadarko Basin, which now total 330 MMBOE and comprise nearly two-thirds of Newfield's total proved reserves. The proved reserve life index for the Company is approximately nine years.
Newfield engaged the consulting firms DeGolyer and MacNaughton and Ryder Scott Company to perform an audit of the internally prepared reserve estimates on certain fields covering 93% of year-end 2016 proved reserve quantities on a barrel of oil equivalent basis. The purpose of these audits was to provide additional assurance on the reasonableness of internally prepared reserve estimates. Newfield's proved reserves are, in aggregate, reasonable and within the established audit tolerance guidelines of 10 percent.
Newfield invested approximately $1.3 billion in 2016, which includes approximately $579 million in acquisitions, land and leasehold expenditures and $121 million of capitalized interest and internal costs. The tables below provide additional information on reserves and costs incurred during 2016.
Crude Oil (MMBbls) |
Natural (Bcf) |
Natural Gas (MMBbls) |
Total (MMBOE) | ||||
Total Company Reserves |
|||||||
December 31, 2015 |
207 |
1,305 |
84 |
509 | |||
Revisions of previous estimates |
(9) |
116 |
13 |
21 | |||
Extensions, discoveries and other additions |
19 |
92 |
8 |
42 | |||
Purchases of properties |
12 |
90 |
7 |
35 | |||
Sales of properties |
(13) |
(102) |
(6) |
(35) | |||
Production |
(26) |
(135) |
(11) |
(59) | |||
December 31, 2016 |
190 |
1,366 |
95 |
513 |
SEC pricing used for year-end 2016 reserve calculations: $2.48 per MMBtu for natural gas and $42.82 per barrel for oil, adjusted for market differentials.
The following table presents costs incurred for oil and gas property acquisition, exploration and development for 2016:
Domestic |
China |
Total | ||||
(in millions) |
||||||
Property acquisitions: |
||||||
Unproved |
$491 |
$ -- |
$491 | |||
Proved |
88 |
-- |
88 | |||
Exploration |
535 |
-- |
535 | |||
Development(1) |
210 |
(1) |
209 | |||
Total costs incurred(2) |
$1,324 |
$ (1) |
$1,323 |
(1) |
Includes ($8) million of asset retirement costs. |
(2) |
Total costs incurred includes approximately $121 million of capitalized interest and internal costs |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. Our U.S. operations are onshore and focus primarily on large scale liquids-rich resource plays. Our principal areas of operation are the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota and the Uinta Basin of Utah. We also have oil producing assets offshore China.
**This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "forecast," "outlook," "could," "budget," "objectives," "strategy," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, China and U.S. governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, new regulations or changes in tax legislation, environmental liabilities not covered by indemnity or insurance, legislation or regulatory initiatives intended to address seismic activity, and other operating risks. Please see Newfield's 2016 Annual Report on Form 10-K and subsequent public filings, all filed with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed in this press release or in Newfield's SEC filings could also have material adverse effects on forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
4Q16 Actual Results |
Domestic |
China |
Total | ||||||||
Production/Liftings(1) |
|||||||||||
Crude oil and condensate (MMBbls) |
4.9 |
1.2 |
6.1 |
||||||||
Natural gas (Bcf) |
31.5 |
— |
31.5 |
||||||||
NGLs (MMBbls) |
2.5 |
— |
2.5 |
||||||||
Total (MMBOE) |
12.7 |
1.2 |
13.9 |
||||||||
Average Realized Prices(2)(3) |
|||||||||||
Crude oil and condensate (per Bbl) |
$ |
48.43 |
$ |
49.28 |
$ |
48.59 |
|||||
Natural gas (per Mcf) |
2.37 |
— |
2.37 |
||||||||
NGLs (per Bbl) |
23.65 |
— |
23.65 |
||||||||
Crude oil equivalent (per BOE) |
$ |
29.59 |
$ |
49.28 |
$ |
31.27 |
|||||
Operating Expenses:(3) |
|||||||||||
Lease operating (in millions) |
|||||||||||
Recurring |
$ |
40 |
$ |
15 |
$ |
55 |
|||||
Major (workovers, etc.) |
$ |
6 |
$ |
— |
$ |
6 |
|||||
Lease operating (per BOE) |
|||||||||||
Recurring |
$ |
3.22 |
$ |
12.57 |
$ |
4.01 |
|||||
Major (workovers, etc.) |
$ |
0.48 |
$ |
0.08 |
$ |
0.45 |
|||||
Transportation and processing (in millions) |
$ |
72 |
$ |
— |
$ |
72 |
|||||
per BOE |
$ |
5.73 |
$ |
— |
$ |
5.24 |
|||||
Production and other taxes (in millions) |
$ |
8 |
$ |
— |
$ |
8 |
|||||
per BOE |
$ |
0.65 |
$ |
0.25 |
$ |
0.62 |
|||||
General and administrative (G&A), net (in millions) |
$ |
43 |
$ |
3 |
$ |
46 |
|||||
per BOE |
$ |
3.40 |
$ |
2.60 |
$ |
3.33 |
|||||
Capitalized direct internal costs (in millions) |
$ |
(17) |
|||||||||
per BOE |
$ |
(1.23) |
|||||||||
Other operating expenses (income), net (in millions) |
$ |
1 |
|||||||||
per BOE |
$ |
0.08 |
|||||||||
Interest expense (in millions) |
$ |
38 |
|||||||||
per BOE |
$ |
2.73 |
|||||||||
Capitalized interest (in millions) |
$ |
(16) |
|||||||||
per BOE |
$ |
(1.14) |
|||||||||
Other non-operating (income) expense (in millions) |
$ |
(3) |
|||||||||
per BOE |
$ |
(0.27) |
_______ | |
(1) |
Represents volumes lifted and sold regardless of when produced. Includes natural gas produced and consumed in operations of 1.1 Bcf during the three months ended December 31, 2016. |
(2) |
Average realized prices include the effects of derivative contracts. Excluding these effects, the average realized price for domestic and total natural gas would have been $2.68 per Mcf and the average realized price for our domestic and total crude oil and condensate would have been $43.39 per barrel and $44.52 per barrel, respectively. We did not have any derivative contracts associated with our NGL or China production as of December 31, 2016. |
(3) |
All per unit pricing and expenses exclude natural gas produced and consumed in operations. |
CONDENSED CONSOLIDATED BALANCE SHEET |
|||||||
(Unaudited, in millions) |
|||||||
December 31, | |||||||
2016 |
2015 | ||||||
ASSETS | |||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ |
555 |
$ |
5 |
|||
Short-term investments |
25 |
— |
|||||
Derivative assets |
75 |
284 |
|||||
Other current assets |
294 |
336 |
|||||
Total current assets |
949 |
625 |
|||||
Oil and gas properties, net (full cost method) |
3,140 |
3,819 |
|||||
Derivative assets |
— |
105 |
|||||
Other assets |
223 |
219 |
|||||
Total assets |
$ |
4,312 |
$ |
4,768 |
|||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: |
|||||||
Derivative liabilities |
97 |
13 |
|||||
Other current liabilities |
587 |
634 |
|||||
Total current liabilities |
684 |
647 |
|||||
Other liabilities |
63 |
48 |
|||||
Derivative liabilities |
3 |
9 |
|||||
Long-term debt |
2,431 |
2,467 |
|||||
Asset retirement obligations |
154 |
192 |
|||||
Deferred taxes |
39 |
26 |
|||||
Total long-term liabilities |
2,690 |
2,742 |
|||||
Stockholders' equity: |
|||||||
Common stock, treasury stock and additional paid-in capital |
3,205 |
2,416 |
|||||
Accumulated other comprehensive income (loss) |
(2) |
(2) |
|||||
Retained earnings (deficit) |
(2,265) |
(1,035) |
|||||
Total stockholders' equity |
938 |
1,379 |
|||||
Total liabilities and stockholders' equity |
$ |
4,312 |
$ |
4,768 |
CONSOLIDATED STATEMENT OF OPERATIONS | |||||||||||||||
(Unaudited, in millions, except per share data) | |||||||||||||||
Three Months Ended |
Year Ended | ||||||||||||||
December 31, |
December 31, | ||||||||||||||
2016 |
2015 |
2016 |
2015 | ||||||||||||
Oil, gas and NGL revenues |
$ |
415 |
$ |
362 |
$ |
1,472 |
$ |
1,557 |
|||||||
Operating expenses: |
|||||||||||||||
Lease operating |
61 |
66 |
244 |
285 |
|||||||||||
Transportation and processing |
72 |
59 |
272 |
212 |
|||||||||||
Production and other taxes |
8 |
3 |
42 |
46 |
|||||||||||
Depreciation, depletion and amortization |
115 |
196 |
572 |
917 |
|||||||||||
General and administrative |
46 |
64 |
213 |
244 |
|||||||||||
Ceiling test and other impairments |
— |
702 |
1,028 |
4,904 |
|||||||||||
Other |
1 |
2 |
20 |
10 |
|||||||||||
Total operating expenses |
303 |
1,092 |
2,391 |
6,618 |
|||||||||||
Income (loss) from operations |
112 |
(730) |
(919) |
(5,061) |
|||||||||||
Other income (expense): |
|||||||||||||||
Interest expense |
(38) |
(37) |
(154) |
(164) |
|||||||||||
Capitalized interest |
16 |
10 |
51 |
33 |
|||||||||||
Commodity derivative income (expense) |
(69) |
29 |
(191) |
259 |
|||||||||||
Other, net |
3 |
(1) |
5 |
(14) |
|||||||||||
Total other income (expense) |
(88) |
1 |
(289) |
114 |
|||||||||||
Income (loss) before income taxes |
24 |
(729) |
(1,208) |
(4,947) |
|||||||||||
Income tax provision (benefit) |
11 |
(66) |
22 |
(1,585) |
|||||||||||
Net income (loss) |
$ |
13 |
$ |
(663) |
$ |
(1,230) |
$ |
(3,362) |
|||||||
Earnings (loss) per share: |
|||||||||||||||
Basic |
$ |
0.07 |
$ |
(4.06) |
$ |
(6.36) |
$ |
(21.18) |
|||||||
Diluted |
$ |
0.07 |
$ |
(4.06) |
$ |
(6.36) |
$ |
(21.18) |
|||||||
Weighted-average number of shares outstanding for basic earnings (loss) per share |
199 |
163 |
193 |
159 |
|||||||||||
Weighted-average number of shares outstanding for diluted earnings (loss) per share |
200 |
163 |
193 |
159 |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS |
|||||||
(Unaudited, in millions) |
|||||||
Year Ended | |||||||
December 31, | |||||||
2016 |
2015 | ||||||
Cash flows from operating activities: |
|||||||
Net income (loss) |
$ |
(1,230) |
$ |
(3,362) |
|||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|||||||
Depreciation, depletion and amortization |
572 |
917 |
|||||
Deferred tax provision (benefit) |
13 |
(1,602) |
|||||
Stock-based compensation |
22 |
25 |
|||||
Unrealized (gain) loss on derivative contracts |
392 |
246 |
|||||
Ceiling test and other impairments |
1,028 |
4,904 |
|||||
Other, net |
13 |
43 |
|||||
810 |
1,171 |
||||||
Changes in operating assets and liabilities |
16 |
38 |
|||||
Net cash provided by (used in) operating activities |
826 |
1,209 |
|||||
Cash flows from investing activities: |
|||||||
Additions to and acquisitions of oil and gas properties and other |
(1,371) |
(1,745) |
|||||
Proceeds from sales of oil and gas properties |
405 |
90 |
|||||
Proceeds from insurance settlement, net |
— |
57 |
|||||
Purchases of investments |
(25) |
— |
|||||
Net cash provided by (used in) investing activities |
(991) |
(1,598) |
|||||
Cash flows from financing activities: |
|||||||
Net proceeds (repayments) of borrowings under credit arrangements |
(39) |
(407) |
|||||
Proceeds from issuance of senior notes |
— |
691 |
|||||
Repayment of senior subordinated notes |
— |
(700) |
|||||
Debt issue costs |
— |
(8) |
|||||
Proceeds from issuances of common stock, net |
779 |
819 |
|||||
Other, net |
(25) |
(15) |
|||||
Net cash provided by (used in) financing activities |
715 |
380 |
|||||
Increase (decrease) in cash and cash equivalents |
550 |
(9) |
|||||
Cash and cash equivalents, beginning of period |
5 |
14 |
|||||
Cash and cash equivalents, end of period |
$ |
555 |
$ |
5 |
Explanation and Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Earnings Stated Without the Effect of Certain Items)
Earnings stated without the effect of certain items is a non-GAAP financial measure. Earnings without the effect of these items are presented because they affect the comparability of operating results from period to period. In addition, earnings without the effect of these items are more comparable to earnings estimates provided by securities analysts. This measure should not be considered an alternative to net income (loss) as defined by generally accepted accounting principles.
A reconciliation of earnings for the fourth quarter of 2016 stated without the effect of certain items to net income (loss) is shown below:
4Q16 | |||
(In millions) | |||
Net Income (loss) |
$ |
13 |
|
Unrealized (gain) loss on derivative contracts |
85 |
||
Earnings stated without the effect of the above items |
$ |
98 |
Discretionary Cash Flow from Operations
Discretionary cash flow from operations represents net cash provided by operating activities before changes in operating assets and liabilities and is presented because of its acceptance as an indicator of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur additional debt. This measure should not be considered an alternative to net cash provided by operating activities as defined by generally accepted accounting principles.
A reconciliation of net cash provided by operating activities to discretionary cash flow from operations is shown below:
4Q16 | |||
(In millions) | |||
Net cash provided by operating activities |
$ |
239 |
|
Net changes in operating assets and liabilities |
(10) |
||
Discretionary cash flow from operations |
$ |
229 |
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Feb. 2, 2017 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) is scheduled to present at the following event:
Credit Suisse 22nd Annual Energy Summit*
10:45 a.m. (Central), February 14, 2017
*A live webcast of the presentation will be made available through Newfield's website at http://www.newfield.com.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We focus on U.S. resource plays and our principal areas of operation include the Mid-Continent and the Rocky Mountains. We also have offshore oil developments in China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Dec. 15, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) will host its fourth quarter / full year 2016 earnings conference call at 10:00 a.m. (CST), Wednesday, February 22, 2017. The Company plans to release its fourth quarter earnings after market close on February 21, 2017.
To participate in the conference call, please dial (785) 830-1924 and enter conference code 5209429 at least 10 minutes prior to the scheduled start time. In addition, a listen-only broadcast of the call will also be provided over the internet at http://www.newfield.com, under Investor Relations.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We focus on U.S. resource plays and our principal areas of operation include the Mid-Continent and the Rocky Mountains. We also have offshore oil developments in China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Dec. 1, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) is scheduled to present at the following events:
Capital One Securities 11th Annual Energy Conference *
10:20 a.m. (Central), December 8, 2016
*A live webcast of the presentation will be made available through Newfield's website at http://www.newfield.com.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We focus on U.S. resource plays and our principal areas of operation include the Mid-Continent and the Rocky Mountains. We also have offshore oil developments in China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Nov. 7, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) is scheduled to present at the following events:
Bank of America Merrill Lynch Global Energy Conference *
8:00 a.m. (Central), November 17, 2016
Jefferies Energy Conference *
11:00 a.m. (Central), November 30, 2016
*A live webcast of the presentations will be made available through Newfield's website at http://www.newfield.com.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We focus on U.S. resource plays and our principal areas of operation include the Mid-Continent and the Rocky Mountains. We also have offshore oil developments in China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Nov. 1, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today reported its third quarter 2016 unaudited financial and operating results. Additional operational details can be found in the Company's @NFX publication, located on its website.
Newfield plans to host a conference call at 10 a.m. CDT on November 2, 2016. To listen to the call, please visit Newfield's website at http://www.newfield.com. To participate in the call, dial 785-830-1926 and provide conference code 6637930 about 10 minutes prior to the scheduled start time.
"Our teams are delivering on our strategic objectives for 2016," said Newfield Chairman Lee K. Boothby. "Including today, we raised production guidance each quarter throughout the year and we expect to beat our original 2016 production guidance (excluding acquisitions) by approximately 3.5 MMBOE, or 7% over our beginning of the year forecast.
"We high-graded our portfolio during the year by selling non-strategic assets in Texas and acquiring additional core acreage in STACK, and we have successfully reduced costs and improved margins across the Company. Today, Newfield has a strong balance sheet, cash on hand and advantaged assets ready for rapid acceleration. We are planning to add additional rigs to our Anadarko Basin drilling program as we enter 2017. Our heightened activity levels can quickly be adjusted if commodity prices weaken moving into next year."
Third Quarter 2016 Financial and Production Summary
For the third quarter, the Company recorded net income of $48 million, or $0.24 per share (all per share amounts are on a diluted basis). Adjusted net income for the third quarter was $89 million, or $0.45 per share after adjustment for the items below:
Revenues for the third quarter were $392 million. Net cash provided by operating activities was $209 million. Discretionary cash flow from operations was $183 million.
Newfield's total net production in the third quarter of 2016 was 15.2 MMBOE, comprised of 42% oil, 19% natural gas liquids and 39% natural gas. Domestic production in the third quarter was 14.3 MMBOE.
2016 Production Guidance and Capital Investments
Newfield again increased expectations for its 2016 production. The increase is related primarily to stronger performance year-to-date from existing assets. Domestic net production is now expected to be 53.7 – 54.1 MMBOE and total Company net production guidance was raised to 58.8 – 59.2 MMBOE (previous forecasts included 1.1 MMBOE in the fourth quarter of 2016 for recently sold Eagle Ford and South Texas assets). See table in @NFX for additional production detail.
The Company's 2016 capital investments are now expected to be approximately $750 million, or the upper end of its previous $700 – $750 million capital investment range (excludes capitalized interest and direct internal costs; excludes acquisitions). The increase to the upper end of our previous range reflects the planned addition of drilling rigs in the Anadarko Basin in late 2016.
2016e Production, Cost and Expense Guidance | ||||||
Domestic |
China |
Total |
||||
Production: |
||||||
Oil (Mmbls) |
20.8 – 21.0 |
5.1 |
25.9 – 26.1 |
|||
NGLs (Mmbls) |
10.6 – 10.7 |
– |
10.6 – 10.7 |
|||
Natural gas (Bcf) |
134 – 135 |
– |
134 – 135 |
|||
Total (Mmboe) |
53.7 – 54.1 |
5.1 |
58.8 – 59.2 |
|||
Expenses ($ mm)1 |
||||||
LOE2 |
$207 |
$53 |
$260 |
|||
Transportation3 |
271 |
– |
271 |
|||
Production & other taxes |
45 |
1 |
46 |
|||
General & administrative (G&A), net4 |
$176 |
$7 |
$183 |
|||
Interest expense, gross |
154 |
– |
154 |
|||
Capitalized interest and direct internal costs |
($120) |
– |
($120) |
|||
Effective Tax rate5 |
0% |
(52%) |
(1%) |
Note: | |
1 |
Cost and expenses are expected to be within 5% of the estimates above |
2 |
Total LOE includes recurring, major expense and non E&P operating expenses |
3 |
Estimated transportation / processing fees include ~$54MM Arkoma unused firm gas transportation and ~$16MM Uinta oil and gas delivery shortfall fees |
4 |
2016e Net G&A excludes an estimated ~$33MM associated with announced restructuring |
5 |
The effective tax rate reflects the impact of future valuation allowance changes related to deferred tax assets |
4Q16e Production, Cost and Expense Guidance | ||||||
Domestic |
China |
Total |
||||
Production: |
||||||
Oil (Mmbls) |
4.7 – 4.9 |
0.9 |
5.6 – 5.9 |
|||
NGLs (Mmbls) |
2.4 – 2.5 |
– |
2.4 – 2.5 |
|||
Natural gas (Bcf) |
30 – 31 |
– |
30 – 31 |
|||
Total (Mmboe) |
12.2 – 12.6 |
0.9 |
13.1 – 13.5 |
|||
Expenses ($ mm)1 |
||||||
LOE2 |
$45 |
$13 |
$58 |
|||
Transportation3 |
71 |
– |
71 |
|||
Production & other taxes |
12 |
– |
12 |
|||
General & administrative (G&A), net3 |
$41 |
$2 |
$43 |
|||
Interest expense, gross |
37 |
– |
37 |
|||
Capitalized interest and direct internal costs |
($31) |
– |
($31) |
|||
Effective Tax rate5 |
5% |
21% |
8% |
Note: | |
1 |
Cost and expenses are expected to be within 5% of the estimates above |
2 |
Total LOE includes recurring, major expense and non E&P operating expenses |
3 |
Estimated transportation / processing fees include ~$13MM Arkoma unused firm gas transportation and ~$9MM Uinta oil and gas delivery shortfall fees |
4 |
4Q16e Net G&A excludes an estimated ~$5MM associated with announced restructuring |
5 |
The effective tax rate reflects the impact of future valuation allowance changes related to deferred tax assets |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on U.S. resource plays and our principal areas of operation include the Mid-Continent and the Rocky Mountains. We also have offshore oil developments in China.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this news release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets, estimated expenses, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although, as of the date of this news release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, China and U.S. federal and state governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, and other operating risks. Please see Newfield's 2015 Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and subsequent public filings with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed herein or in Newfield's SEC filings could also have material adverse effects on actual results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: IR@newfield.com
3Q16 Actual | ||||||||||||
3Q16 Actual Results |
Domestic |
China |
Total | |||||||||
Production/Liftings(1) |
||||||||||||
Crude oil and condensate (MMBbls) |
5.5 |
0.9 |
6.4 |
|||||||||
Natural gas (Bcf) |
35.6 |
— |
35.6 |
|||||||||
NGLs (MMBbls) |
2.9 |
— |
2.9 |
|||||||||
Total (MMBOE) |
14.3 |
0.9 |
15.2 |
|||||||||
Average Realized Prices(2)(3) |
||||||||||||
Crude oil and condensate (per Bbl) |
$ |
47.20 |
$ |
41.33 |
$ |
46.34 |
||||||
Natural gas (per Mcf) |
2.38 |
— |
2.38 |
|||||||||
NGLs (per Bbl) |
18.53 |
— |
18.53 |
|||||||||
Crude oil equivalent (per BOE) |
$ |
27.91 |
$ |
41.33 |
$ |
28.74 |
||||||
Operating Expenses:(3) |
||||||||||||
Lease operating (in millions) |
||||||||||||
Recurring |
$ |
44 |
$ |
10 |
$ |
54 |
||||||
Major (workovers, etc.) |
$ |
6 |
$ |
— |
$ |
6 |
||||||
Lease operating (per BOE) |
||||||||||||
Recurring |
$ |
3.11 |
$ |
11.02 |
$ |
3.60 |
||||||
Major (workovers, etc.) |
$ |
0.46 |
$ |
0.28 |
$ |
0.45 |
||||||
Transportation and processing (in millions) |
$ |
71 |
$ |
— |
$ |
71 |
||||||
per BOE |
$ |
5.04 |
$ |
— |
$ |
4.72 |
||||||
Production and other taxes (in millions) |
$ |
12 |
$ |
1 |
$ |
13 |
||||||
per BOE |
$ |
0.89 |
$ |
0.15 |
$ |
0.85 |
||||||
General and administrative (G&A), net (in millions) |
$ |
63 |
$ |
2 |
$ |
65 |
||||||
per BOE |
$ |
4.49 |
$ |
1.81 |
$ |
4.32 |
||||||
Capitalized direct internal costs (in millions) |
$ |
(17) |
||||||||||
per BOE |
$ |
(1.14) |
||||||||||
Other operating expenses (income), net (in millions) |
$ |
18 |
||||||||||
per BOE |
$ |
1.23 |
||||||||||
Interest expense (in millions) |
$ |
37 |
||||||||||
per BOE |
$ |
2.51 |
||||||||||
Capitalized interest (in millions) |
$ |
(15) |
||||||||||
per BOE |
$ |
(1.06) |
||||||||||
Other non-operating (income) expense (in millions) |
$ |
(1) |
||||||||||
per BOE |
$ |
(0.02) |
||||||||||
(1) |
Represents volumes lifted and sold regardless of when produced. Includes natural gas produced and consumed in operations of 1.4 Bcf during the three months ended September 30, 2016. |
(2) |
Average realized prices include the effects of derivative contracts. Excluding these effects, the average realized price for domestic and total natural gas would have been $2.55 per Mcf and the average realized price for our domestic and total crude oil and condensate would have been $38.80 per barrel and $39.17 per barrel, respectively. We did not have any derivative contracts associated with our NGL or China production as of September 30, 2016. |
(3) |
All per unit pricing and expenses exclude natural gas produced and consumed in operations. |
CONDENSED CONSOLIDATED BALANCE SHEET | |||||||
(Unaudited, in millions) | |||||||
September 30, |
December 31, | ||||||
2016 |
2015 | ||||||
ASSETS |
|||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ |
478 |
$ |
5 |
|||
Short-term investments |
25 |
— |
|||||
Derivative assets |
115 |
284 |
|||||
Other current assets |
281 |
336 |
|||||
Total current assets |
899 |
625 |
|||||
Oil and gas properties, net (full cost method) |
3,076 |
3,819 |
|||||
Derivative assets |
10 |
105 |
|||||
Other assets |
228 |
219 |
|||||
Total assets |
$ |
4,213 |
$ |
4,768 |
|||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|||||||
Current liabilities: |
|||||||
Derivative liabilities |
$ |
55 |
$ |
13 |
|||
Other current liabilities |
530 |
634 |
|||||
Total current liabilities |
585 |
647 |
|||||
Other liabilities |
65 |
48 |
|||||
Derivative liabilities |
10 |
9 |
|||||
Long-term debt |
2,430 |
2,467 |
|||||
Asset retirement obligations |
173 |
192 |
|||||
Deferred taxes |
34 |
26 |
|||||
Total long-term liabilities |
2,712 |
2,742 |
|||||
Stockholders' equity: |
|||||||
Common stock, treasury stock and additional paid-in capital |
3,196 |
2,416 |
|||||
Accumulated other comprehensive gain (loss) |
(2) |
(2) |
|||||
Retained earnings (deficit) |
(2,278) |
(1,035) |
|||||
Total stockholders' equity |
916 |
1,379 |
|||||
Total liabilities and stockholders' equity |
$ |
4,213 |
$ |
4,768 |
CONSOLIDATED STATEMENT OF OPERATIONS | ||||||||||||||||
(Unaudited, in millions, except per share data) | ||||||||||||||||
Three Months Ended |
Nine Months Ended |
|||||||||||||||
September 30, |
September 30, |
|||||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||||
Oil, gas and NGL revenues |
$ |
392 |
$ |
377 |
$ |
1,057 |
$ |
1,195 |
||||||||
Operating expenses: |
||||||||||||||||
Lease operating |
60 |
71 |
183 |
219 |
||||||||||||
Transportation and processing |
71 |
52 |
200 |
153 |
||||||||||||
Production and other taxes |
13 |
13 |
34 |
43 |
||||||||||||
Depreciation, depletion and amortization |
120 |
236 |
457 |
721 |
||||||||||||
General and administrative |
65 |
66 |
167 |
180 |
||||||||||||
Ceiling test and other impairments |
— |
1,889 |
1,028 |
4,202 |
||||||||||||
Other |
18 |
1 |
19 |
8 |
||||||||||||
Total operating expenses |
347 |
2,328 |
2,088 |
5,526 |
||||||||||||
Income (loss) from operations |
45 |
(1,951) |
(1,031) |
(4,331) |
||||||||||||
Other income (expense): |
||||||||||||||||
Interest expense |
(37) |
(37) |
(116) |
(127) |
||||||||||||
Capitalized interest |
15 |
8 |
35 |
23 |
||||||||||||
Commodity derivative income (expense) |
28 |
87 |
(122) |
230 |
||||||||||||
Other, net |
1 |
1 |
2 |
(13) |
||||||||||||
Total other income (expense) |
7 |
59 |
(201) |
113 |
||||||||||||
Income (loss) before income taxes |
52 |
(1,892) |
(1,232) |
(4,218) |
||||||||||||
Income tax provision (benefit) |
4 |
(665) |
11 |
(1,519) |
||||||||||||
Net income (loss) |
$ |
48 |
$ |
(1,227) |
$ |
(1,243) |
$ |
(2,699) |
||||||||
Earnings (loss) per share: |
||||||||||||||||
Basic |
$ |
0.24 |
$ |
(7.52) |
$ |
(6.50) |
$ |
(17.17) |
||||||||
Diluted |
$ |
0.24 |
$ |
(7.52) |
$ |
(6.50) |
$ |
(17.17) |
||||||||
Weighted-average number of shares outstanding for basic earnings (loss) per share |
199 |
163 |
191 |
157 |
||||||||||||
Weighted-average number of shares outstanding for diluted earnings (loss) per share |
200 |
163 |
191 |
157 |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | ||||||||
(Unaudited, in millions) | ||||||||
Nine Months Ended |
||||||||
September 30, |
||||||||
2016 |
2015 | |||||||
Cash flows from operating activities: |
||||||||
Net income (loss) |
$ |
(1,243) |
$ |
(2,699) |
||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
||||||||
Depreciation, depletion and amortization |
457 |
721 |
||||||
Deferred tax provision (benefit) |
8 |
(1,544) |
||||||
Stock-based compensation |
14 |
19 |
||||||
Unrealized (gain) loss on derivative contracts |
307 |
145 |
||||||
Ceiling test and other impairments |
1,028 |
4,202 |
||||||
Other, net |
10 |
38 |
||||||
581 |
882 |
|||||||
Changes in operating assets and liabilities |
6 |
7 |
||||||
Net cash provided by (used in) operating activities |
587 |
889 |
||||||
Cash flows from investing activities: |
||||||||
Additions to and acquisitions of oil and gas properties and other |
(1,203) |
(1,428) |
||||||
Proceeds from sales of oil and gas properties |
399 |
86 |
||||||
Proceeds from insurance settlement, net |
— |
57 |
||||||
Purchases of investments |
(25) |
— |
||||||
Net cash provided by (used in) investing activities |
(829) |
(1,285) |
||||||
Cash flows from financing activities: |
||||||||
Net proceeds (repayments) of borrowings under credit arrangements |
(39) |
(398) |
||||||
Proceeds from issuance of senior notes |
— |
691 |
||||||
Repayment of senior subordinated notes |
— |
(700) |
||||||
Debt issue costs |
— |
(8) |
||||||
Proceeds from issuances of common stock, net |
777 |
817 |
||||||
Other, net |
(23) |
(13) |
||||||
Net cash provided by (used in) financing activities |
715 |
389 |
||||||
Increase (decrease) in cash and cash equivalents |
473 |
(7) |
||||||
Cash and cash equivalents, beginning of period |
5 |
14 |
||||||
Cash and cash equivalents, end of period |
$ |
478 |
$ |
7 |
||||
Explanation and Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Earnings Stated Without the Effect of Certain Items)
Earnings stated without the effect of certain items is a non-GAAP financial measure. Earnings without the effect of these items are presented because they affect the comparability of operating results from period to period. In addition, earnings without the effect of these items are more comparable to earnings estimates provided by securities analysts. This measure should not be considered an alternative to net income (loss) as defined by generally accepted accounting principles.
A reconciliation of earnings for the third quarter of 2016 stated without the effect of certain items to net income (loss) is shown below:
3Q16 | |||
(In millions) | |||
Net Income (loss) |
$ |
48 | |
Unrealized (gain) loss on derivative contracts |
11 | ||
Restructuring related costs |
16 | ||
Legal settlement |
18 | ||
Income tax adjustment for above items |
(4) | ||
Earnings stated without the effect of the above items |
$ |
89 |
Discretionary Cash Flow from Operations
Discretionary cash flow from operations represents net cash provided by operating activities before changes in operating assets and liabilities and is presented because of its acceptance as an indicator of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur additional debt. This measure should not be considered an alternative to net cash provided by operating activities as defined by generally accepted accounting principles.
A reconciliation of net cash provided by operating activities to discretionary cash flow from operations is shown below:
3Q16 | |||
(In millions) | |||
Net cash provided by operating activities |
$ |
209 | |
Net changes in operating assets and liabilities |
(26) | ||
Discretionary cash flow from operations |
$ |
183 |
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Sept. 29, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) will host its third quarter 2016 earnings conference call at 10:00 a.m. (CT), Wednesday, November 2, 2016. The Company plans to release its third quarter financial and operating results after market close on November 1, 2016.
To participate in the conference call, please dial (785) 830-1926 and provide conference code 6637930 about 10 minutes prior to the scheduled start time. In addition, a listen-only broadcast of the call also will be provided over the internet at http://www.newfield.com, under Investor Relations.
Newfield Exploration Company is an independent energy company engaged in exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on North American resource plays and our principal areas of operation include the Mid-Continent and the Rocky Mountains. In addition, the Company has oil developments offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Sept. 27, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today announced the closing on its previously-disclosed transactions to sell its producing oil and gas properties and undeveloped acreage in Texas. Combined proceeds from the sales were approximately $380 million.
The transactions included Newfield's unconventional assets in the Eagle Ford Shale and its conventional natural gas assets in south and west Texas. Current net daily production from the combined assets was approximately 12,700 BOEPD, of which approximately 35% was oil. The Eagle Ford package was sold to Protégé Energy III LLC. The Company's conventional natural gas assets in South Texas were sold to an undisclosed party.
Newfield today reiterated its previous third quarter 2016 production guidance as the sales are expected to have an immaterial impact on its third quarter production. The Company plans to revise its full-year 2016 production expectations to reflect the sale of these assets along with the release of its third quarter financial and operating results on November 1, 2016.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. The Company is focused on U.S. resource plays and its principal areas of operation include the Mid-Continent and the Rocky Mountains. Newfield also has offshore oil developments in China.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this news release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although, as of the date of this news release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, China and U.S. governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to monetize assets and repay or refinance our existing indebtedness, our ability to successfully close asset transactions, labor conditions, severe weather conditions, and other operating risks. Please see Newfield's 2015 Annual Report on Form 10-K and subsequent public filings with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed herein or in Newfield's SEC filings could also have material adverse effects on actual results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Aug. 25, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) is scheduled to present at the following events:
Barclays Capital CEO Energy-Power Conference *
2:25 p.m. (Eastern), September 7, 2016
UBS Houston Energy Bus-less Tour *
4:15 p.m. (Eastern), September 14, 2016
*A live webcast of the presentation will be made available through Newfield's website at http://www.newfield.com.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on U.S. resource plays and our principal areas of operation include the Mid-Continent and the Rocky Mountains. We also have offshore oil developments in China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Aug. 3, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today announced the signing of two separate purchase and sale agreements to divest substantially all of its assets in Texas for combined net after tax proceeds of nearly $390 million, subject to customary purchase price adjustments. The transactions, expected to close in the third quarter of 2016, are subject to ordinary closing conditions.
"We continue to refine our portfolio and focus our people and capital resources on assets with high returns and a deep inventory of future drilling opportunities," said Newfield Chairman & CEO Lee K. Boothby. "Since 2009, we have generated about $3 billion in proceeds from asset sales (including today's announcement) as we transitioned to an oil company with a premium asset portfolio in onshore resource plays. Proceeds from the sale of our Texas assets will replenish our cash balance and position us for the timely acceleration of our STACK development in the future."
The transactions include Newfield's unconventional assets in the Eagle Ford Shale and its conventional natural gas assets in south and west Texas. Current net daily production from the combined assets is approximately 12,700 BOEPD, of which approximately 35% is oil. The agreement to sell the Eagle Ford package was signed with Protégé LLC. The second agreement for conventional natural gas assets in South Texas was signed with an undisclosed party. Newfield expects to update its 2016 production guidance upon closing of these two transactions.
BMO Capital Markets and Scotia Waterous acted as financial advisors for these transactions.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on U.S. resource plays and our principal areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. We also have offshore oil developments in China.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this news release, all information and statements, including but not limited to information regarding transaction closing timing, planned capital expenditures, estimated reserves, estimated production targets, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although, as of the date of this news release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, China and U.S. governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to monetize assets and repay or refinance our existing indebtedness, our ability to successfully close asset transactions, labor conditions, severe weather conditions, and other operating risks. Please see Newfield's 2015 Annual Report on Form 10-K and subsequent public filings with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed herein or in Newfield's SEC filings could also have material adverse effects on actual results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Aug. 2, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today reported its second quarter 2016 unaudited financial and operating results. Additional operational details can be found in the Company's @NFX publication, located on its website.
Newfield plans to host a conference call at 10 a.m. CDT on August 3, 2016. To listen to the call, please visit Newfield's website at http://www.newfield.com. To participate in the call, dial 785-830-7977 and enter conference code 4680250 about 10 minutes prior to the scheduled start time.
"Newfield continued its streak of solid operational results across the organization," said Newfield Chairman Lee K. Boothby. "We have taken proactive steps to improve our capital structure, refine our asset base, and high-grade our investments into the Anadarko Basin. The results are evident – lower operating expenses, improving margins in the face of low commodity prices and the realization of operational efficiencies that we expect to retain in the future.
"Today, we increased our average type curve in STACK by 15% to approximately 1.1 MMBOE gross. This increase is backed by the drilling of more than 100 wells to date – the largest sample set in the industry. Our well results continue to improve as we optimize our completions and look for innovative ways to enhance returns in our upcoming full-field development campaign. We recently closed on our previously announced STACK acquisition and have allocated additional capital to these assets in the second half of this year. We remain excited about STACK and the play's potential to drive our growth in production and reserves for years to come."
Second Quarter 2016 Financial and Production Summary
For the second quarter, the Company recorded a net loss of $667 million, or $3.36 per share (all per share amounts are on a diluted basis). The loss was primarily attributable to the following items:
After adjusting for these effects, net income for the second quarter would have been $64 million, or $0.32 per share.
Revenues for the second quarter were $381 million. Net cash provided by operating activities was $306 million. Discretionary cash flow from operations was $228 million.
Newfield's total net production in the second quarter of 2016 was 15.3 MMBOE, comprised of 45% oil, 18% natural gas liquids and 37% natural gas. Domestic production in the second quarter was 13.7 MMBOE.
2016 Production Guidance and Capital Investments
Newfield again increased expectations for its 2016 production. The increase is related primarily to stronger performance year-to-date from existing assets and the recently acquired assets in the Anadarko Basin STACK play. Domestic net production is now expected to be 53 – 54.5 MMBOE. Total Company net production guidance was raised to 58 – 59.5 (previous forecast: 56 – 58 MMBOE).
The Company's 2016 capital budget was increased to $700 – $750 million (excludes capitalized interest and direct internal costs; excludes acquisitions; previous capital range: $625 – $675 million). The increase reflects approximately $40 million for two STACK pilots (previously disclosed), and approximately $50 million for additional drilling activities on existing assets and assets associated with recently acquired properties in STACK.
2016e Production, Cost and Expense Guidance | ||||||
Domestic |
China |
Total |
||||
Production: |
||||||
Oil (Mmbls) |
21.1 |
5.0 |
26.1 |
|||
NGLs (Mmbls) |
10.3 |
– |
10.3 |
|||
Natural gas (Bcf) |
134 |
– |
134 |
|||
Total (Mmboe) |
53.0 – 54.5 |
5.0 |
58.0 – 59.5 |
|||
Expenses ($ mm)1 |
||||||
LOE2 |
$196 |
$55 |
$251 |
|||
Transportation3 |
271 |
– |
271 |
|||
Production & other taxes |
48 |
1 |
49 |
|||
General & administrative (G&A), net4 |
$173 |
$7 |
$180 |
|||
Interest expense, gross |
154 |
– |
154 |
|||
Capitalized interest and direct internal costs |
($112) |
– |
($112) |
|||
Effective Tax rate5 |
0% |
(36%) |
(1%) |
Note: Based on strip commodity prices | |
1Cost and expenses are expected to be within 5% of the estimates above | |
2Total LOE includes recurring, major expense and non E&P operating expenses | |
3Estimated transportation / processing fees include ~$52MM Arkoma unused firm gas transportation and ~$21MM Uinta oil and gas delivery shortfall fees | |
42016e Net G&A excludes an estimated ~$30MM associated with announced restructuring | |
5The effective tax rate reflects expected future valuation allowances recorded against deferred tax assets generated by ceiling test impairments. |
3Q16e Production, Cost and Expense Guidance | ||||||
Domestic |
China |
Total |
||||
Production: |
||||||
Oil (Mmbls) |
5.3 |
0.8 |
6.1 |
|||
NGLs (Mmbls) |
2.6 |
– |
2.6 |
|||
Natural gas (Bcf) |
34 |
– |
34 |
|||
Total (Mmboe) |
13.5 – 13.7 |
0.8 |
14.3 – 14.5 |
|||
Expenses ($ mm)1 |
||||||
LOE2 |
$52 |
$10 |
$62 |
|||
Transportation3 |
70 |
– |
70 |
|||
Production & other taxes |
13 |
– |
13 |
|||
General & administrative (G&A), net3 |
$44 |
$2 |
$46 |
|||
Interest expense, gross |
38 |
– |
38 |
|||
Capitalized interest and direct internal costs |
($29) |
– |
($29) |
|||
Effective Tax rate5 |
(1%) |
(22%) |
(2%) |
Note: Based on strip commodity prices | |
1Cost and expenses are expected to be within 5% of the estimates above | |
2Total LOE includes recurring, major expense and non E&P operating expenses | |
3Estimated transportation / processing fees include ~$13MM Arkoma unused firm gas transportation and ~$5MM Uinta oil and gas delivery shortfall fees | |
43Q16e Net G&A excludes an estimated ~$10MM associated with announced restructuring | |
5The effective tax rate reflects expected future valuation allowances recorded against deferred tax assets generated by ceiling test impairments. |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on U.S. resource plays and our principal areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. We also have offshore oil developments in China.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this news release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although, as of the date of this news release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, China and U.S. governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, and other operating risks. Please see Newfield's 2015 Annual Report on Form 10-K and subsequent public filings with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed herein or in Newfield's SEC filings could also have material adverse effects on actual results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
2Q16 Actual | ||||||||||||||||||
2Q16 Actual Results |
Domestic |
China |
Total | |||||||||||||||
Production/Liftings1 |
||||||||||||||||||
Crude oil and condensate (MMBbls) |
5.2 |
1.6 |
6.8 | |||||||||||||||
Natural gas (Bcf) |
33.8 |
— |
33.8 | |||||||||||||||
NGLs (MMBbls) |
2.8 |
— |
2.8 | |||||||||||||||
Total (MMBOE) |
13.7 |
1.6 |
15.3 | |||||||||||||||
Average Realized Prices2, 3 |
||||||||||||||||||
Crude oil and condensate (per Bbl) |
$ |
49.12 |
$ |
43.95 |
$ |
47.90 | ||||||||||||
Natural gas (per Mcf) |
1.86 |
— |
1.86 | |||||||||||||||
NGLs (per Bbl) |
19.23 |
— |
19.23 | |||||||||||||||
Crude oil equivalent (per BOE) |
$ |
27.65 |
$ |
43.95 |
$ |
29.41 | ||||||||||||
Operating Expenses:3 |
||||||||||||||||||
Lease operating (in millions) |
||||||||||||||||||
Recurring |
$ |
42.4 |
$ |
15.3 |
$ |
57.7 | ||||||||||||
Major (workovers, etc.) |
$ |
3.8 |
$ |
0.2 |
$ |
4.0 | ||||||||||||
Lease operating (per BOE) |
||||||||||||||||||
Recurring |
$ |
3.14 |
$ |
9.33 |
$ |
3.82 | ||||||||||||
Major (workovers, etc.) |
$ |
0.28 |
$ |
0.12 |
$ |
0.26 | ||||||||||||
Transportation and processing (in millions) |
$ |
65.5 |
$ |
— |
$ |
65.5 | ||||||||||||
per BOE |
$ |
4.86 |
$ |
— |
$ |
4.34 | ||||||||||||
Production and other taxes (in millions) |
$ |
11.0 |
$ |
0.2 |
$ |
11.2 | ||||||||||||
per BOE |
$ |
0.82 |
$ |
0.12 |
$ |
0.74 | ||||||||||||
General and administrative (G&A), net (in millions) |
$ |
56.4 |
$ |
1.6 |
$ |
58.0 | ||||||||||||
per BOE |
$ |
4.21 |
$ |
0.97 |
$ |
3.86 | ||||||||||||
Capitalized direct internal costs (in millions) |
$ |
(19.2) | ||||||||||||||||
per BOE |
$ |
(1.27) | ||||||||||||||||
Other operating expenses (income), net (in millions) |
$ |
(0.1) | ||||||||||||||||
per BOE |
$ |
(0.01) | ||||||||||||||||
Interest expense (in millions) |
$ |
37.6 | ||||||||||||||||
per BOE |
$ |
2.49 | ||||||||||||||||
Capitalized interest (in millions) |
$ |
(10.5) | ||||||||||||||||
per BOE |
$ |
(0.68) | ||||||||||||||||
Other non-operating (income) expense (in millions) |
$ |
(0.4) | ||||||||||||||||
per BOE |
$ |
(0.06) |
____ Note 1: Represents volumes lifted and sold regardless of when produced. Includes natural gas produced and consumed in operations of 1.3 Bcf during the three months ended June 30, 2016. | ||||||||||||||||||
Note 2: Average realized prices include the effects of derivative contracts. Excluding these effects, the average realized price for domestic and total natural gas would have been $1.69 per Mcf and the average realized price for our domestic and total crude oil and condensate would have been $38.17 per barrel and $39.54 per barrel, respectively. We did not have any derivative contracts associated with our NGL or China production as of June 30, 2016. | ||||||||||||||||||
Note 3: All per unit pricing and expenses exclude natural gas produced and consumed in operations. | ||||||||||||||||||
CONSOLIDATED STATEMENT OF OPERATIONS | ||||||||||||||
(Unaudited, in millions, except per share data) | ||||||||||||||
Three Months Ended June 30, |
Six Months Ended June 30, | |||||||||||||
2016 |
2015 |
2016 |
2015 | |||||||||||
Oil, gas and NGL revenues |
$ |
381 |
$ |
469 |
$ |
665 |
$ |
818 | ||||||
Operating expenses: |
||||||||||||||
Lease operating |
62 |
73 |
123 |
148 | ||||||||||
Transportation and processing |
66 |
52 |
129 |
101 | ||||||||||
Production and other taxes |
11 |
17 |
21 |
30 | ||||||||||
Depreciation, depletion and amortization |
160 |
248 |
337 |
485 | ||||||||||
General and administrative |
58 |
51 |
102 |
114 | ||||||||||
Ceiling test and other impairments |
522 |
1,521 |
1,028 |
2,313 | ||||||||||
Other |
— |
3 |
1 |
7 | ||||||||||
Total operating expenses |
879 |
1,965 |
1,741 |
3,198 | ||||||||||
Income (loss) from operations |
(498) |
(1,496) |
(1,076) |
(2,380) | ||||||||||
Other income (expense): |
||||||||||||||
Interest expense |
(38) |
(46) |
(79) |
90 | ||||||||||
Capitalized interest |
11 |
8 |
20 |
15 | ||||||||||
Commodity derivative income (expense) |
(133) |
(10) |
(150) |
143 | ||||||||||
Other, net |
— |
(22) |
1 |
(14) | ||||||||||
Total other income (expense) |
(160) |
(70) |
(208) |
54 | ||||||||||
Income (loss) before income taxes |
(658) |
(1,566) |
(1,284) |
(2,326) | ||||||||||
Income tax provision (benefit) |
9 |
(574) |
7 |
(854) | ||||||||||
Net income (loss) |
$ |
(667) |
$ |
(992) |
$ |
(1,291) |
$ |
(1,472) | ||||||
Earnings (loss) per share: |
||||||||||||||
Basic |
$ |
(3.36) |
$ |
(6.09) |
$ |
(6.87) |
$ |
(9.55) | ||||||
Diluted |
$ |
(3.36) |
$ |
(6.09) |
$ |
(6.87) |
$ |
(9.55) | ||||||
Weighted-average number of shares outstanding for basic earnings (loss) per share |
198 |
163 |
188 |
154 | ||||||||||
Weighted-average number of shares outstanding for diluted earnings (loss) per share |
198 |
163 |
188 |
154 | ||||||||||
CONDENSED CONSOLIDATED BALANCE SHEET | ||||||
(Unaudited, in millions) | ||||||
June 30, |
December 31, | |||||
2016 |
2015 | |||||
ASSETS |
||||||
Current assets: |
||||||
Cash and cash equivalents |
$ |
165 |
$ |
5 | ||
Derivative assets |
150 |
284 | ||||
Other current assets |
323 |
336 | ||||
Total current assets |
638 |
625 | ||||
Oil and gas properties, net (full cost method) |
3,403 |
3,819 | ||||
Derivative assets |
20 |
105 | ||||
Other assets |
224 |
219 | ||||
Total assets |
$ |
4,285 |
$ |
4,768 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY |
||||||
Current liabilities: |
||||||
Derivative liabilities |
$ |
78 |
$ |
13 | ||
Other current liabilities |
579 |
634 | ||||
Total current liabilities |
657 |
647 | ||||
Other liabilities |
72 |
48 | ||||
Derivative liabilities |
21 |
9 | ||||
Long-term debt |
2,430 |
2,467 | ||||
Asset retirement obligations |
204 |
192 | ||||
Deferred taxes |
29 |
26 | ||||
Total long-term liabilities |
2,756 |
2,742 | ||||
Stockholders' equity: |
||||||
Common stock, treasury stock and additional paid-in capital |
3,200 |
2,416 | ||||
Accumulated other comprehensive gain (loss) |
(2) |
(2) | ||||
Retained earnings (deficit) |
(2,326) |
(1,035) | ||||
Total stockholders' equity |
872 |
1,379 | ||||
Total liabilities and stockholders' equity |
$ |
4,285 |
$ |
4,768 | ||
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited, in millions) | |||||||||||
Six Months Ended June 30, | |||||||||||
2016 |
2015 | ||||||||||
Cash flows from operating activities: |
|||||||||||
Net income (loss) |
$ |
(1,291) |
$ |
(1,472) | |||||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|||||||||||
Depreciation, depletion and amortization |
337 |
485 | |||||||||
Deferred tax provision (benefit) |
3 |
(872) | |||||||||
Stock-based compensation |
19 |
25 | |||||||||
Unrealized (gain) loss on derivative contracts |
296 |
101 | |||||||||
Ceiling test and other impairments |
1,028 |
2,313 | |||||||||
Other, net |
6 |
22 | |||||||||
398 |
602 | ||||||||||
Changes in operating assets and liabilities |
(20) |
(25) | |||||||||
Net cash provided by (used in) operating activities |
378 |
577 | |||||||||
Cash flows from investing activities: |
|||||||||||
Additions and acquisitions of oil and gas properties and other |
(974) |
(927) | |||||||||
Proceeds from sales of oil and gas properties |
29 |
29 | |||||||||
Net cash provided by (used in) investing activities |
(945) |
(898) | |||||||||
Cash flows from financing activities: |
|||||||||||
Net proceeds (repayments) of borrowings under credit arrangements |
(39) |
(446) | |||||||||
Proceeds from issuance of senior notes |
— |
691 | |||||||||
Repayment of senior subordinated notes |
— |
(700) | |||||||||
Debt issue costs |
— |
(8) | |||||||||
Proceeds from issuances of common stock, net |
777 |
817 | |||||||||
Other, net |
(11) |
(5) | |||||||||
Net cash provided by (used in) financing activities |
727 |
349 | |||||||||
Increase (decrease) in cash and cash equivalents |
160 |
28 | |||||||||
Cash and cash equivalents, beginning of period |
5 |
14 | |||||||||
Cash and cash equivalents, end of period |
$ |
165 |
$ |
42 | |||||||
Explanation and Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Earnings Stated Without the Effect of Certain Items)
Earnings stated without the effect of certain items is a non-GAAP financial measure. Earnings without the effect of these items are presented because they affect the comparability of operating results from period to period. In addition, earnings without the effect of these items are more comparable to earnings estimates provided by securities analysts. This measure should not be considered an alternative to net income (loss) as defined by generally accepted accounting principles.
A reconciliation of earnings for the second quarter of 2016 stated without the effect of certain items to net income (loss) is shown below:
2Q16 | ||||||||||
(in millions) | ||||||||||
Net Income (loss) |
$ |
(667) | ||||||||
Ceiling test impairments |
522 | |||||||||
Unrealized (gain) loss on derivative contracts |
197 | |||||||||
Restructuring related costs |
12 | |||||||||
Income tax adjustment for above items(1) |
— | |||||||||
Earnings stated without the effect of the above items |
$ |
64 | ||||||||
(1) Our effective tax rate is less than 1% due to valuation allowances on our deferred tax assets. | |||||||||||||
Discretionary Cash Flow from Operations
Discretionary cash flow from operations represents net cash provided by operating activities before changes in operating assets and liabilities and is presented because of its acceptance as an indicator of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur additional debt. This measure should not be considered an alternative to net cash provided by operating activities as defined by generally accepted accounting principles.
A reconciliation of net cash provided by operating activities to discretionary cash flow from operations is shown below:
2Q16 | ||||||||
(in millions) | ||||||||
Net cash provided by operating activities |
$ |
306 | ||||||
Net changes in operating assets and liabilities |
(78) | |||||||
Discretionary cash flow from operations |
$ |
228 | ||||||
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, June 30, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) will host its second quarter 2016 earnings conference call at 10:00 a.m. (CT), Wednesday, August 3, 2016. The Company plans to release its second quarter earnings after market close on August 2, 2016.
To participate in the conference call, please dial (785) 830-7977 and provide conference code 4680250 about 10 minutes prior to the scheduled start time. In addition, a listen-only broadcast of the call also will be provided over the internet at http://www.newfield.com, under Investor Relations.
Newfield Exploration Company is an independent energy company engaged in exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on North American resource plays and our principal areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. In addition, the Company has oil developments offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, June 21, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today provided an interim operations update and raised production expectations for the second quarter and full-year 2016. The disclosure was made in conjunction with its planned appearances at two industry energy conferences in late June. Newfield has posted to its website (www.newfield.com) an updated edition of its @NFX publication.
The Company increased its production guidance for the second quarter and full-year 2016. Second quarter 2016 net production for the Company is now expected to exceed the mid-point of guidance by approximately 0.5 MMBOE and is estimated to be about 15.2 MMBOE (previous range was 14.4 – 14.9 MMBOE). Domestic net production for the second quarter of 2016 is expected to be more than 13.6 MMBOE (previous range was 13.0 – 13.5 MMBOE). International net production for the second quarter of 2016 is expected to be approximately 1.6 MMBOE (previous guidance was 1.4 MMBOE). Full-year 2016 net production for the Company is now expected to be 56.0 – 58.0 MMBOE (previous range was 54.5 – 56.5 MMBOE).
"Our Anadarko Basin production continues to exceed expectations with strong well performance across our expanding footprint," said Newfield Chairman, President and CEO Lee K. Boothby. "We have now production-delineated more than 95% of our legacy STACK position (Kingfisher and Canadian counties, OK) and after nearly 100 wells and four years of drilling activity; we continue to deliver wells on or above our average type curve. This is great news and reinforces the consistency of well results, the depth of our inventory and the continual improvements in rates of return that we believe will come in full-field development. Recent drilling and completion efficiencies are leading to 'best in class' wells – both in terms of costs and production performance. Today, we anticipate drilling development wells for less than $6 million (gross) and we expect to have a portion of our STACK rig fleet in active field development in 2017."
Recent operational highlights from the Anadarko Basin include:
Following the closing of its recently announced acquisition of acreage in STACK, the Company plans to provide an additional update to its 2016 production guidance to reflect the impact of this acquisition.
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on U.S. resource plays and our principal areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. We also have offshore oil developments in China.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this news release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although, as of the date of this news release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, China and U.S. governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, and other operating risks. Please see Newfield's 2015 Annual Report on Form 10-K and Quarterly Report on Form 10-Q for 1Q 2016, both filed with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed herein or in Newfield's SEC filings could also have material adverse effects on actual results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, June 16, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) is scheduled to present at the following events. A live webcast of the presentation will be made available through Newfield's website at http://www.newfield.com.
2016 Wells Fargo West Coast Energy Conference
11:15 a.m. (Pacific), June 22, 2016
J. P. Morgan Inaugural Energy Equity Investor Conference 2016
11:20 a.m. (Eastern), June 29, 2016
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on U.S. resource plays and our principal areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. We also have offshore oil developments in China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, May 12, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) is scheduled to present at the following event. A live webcast of the presentation will be made available through Newfield's website at http://www.newfield.com.
UBS Global Oil and Gas Conference
11:10 a.m. (Central), May 25, 2016
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on U.S. resource plays and our principal areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. We also have offshore oil developments in China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, May 5, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today signed a definitive purchase and sale agreement with a subsidiary of Chesapeake Energy Corporation (NYSE: CHK) to acquire approximately 42,000 net acres in the Anadarko Basin STACK play for $470 million. The transaction will have an effective date of April 1, 2016 and closing is subject to customary adjustments. Newfield expects to fund the transaction with cash on hand and closing is planned for the second quarter of 2016.
Transaction Highlights:
"This bolt-on acquisition is ideal for Newfield, combining strategic fit in a growing resource play where we have a clear competitive advantage," said Newfield Chairman Lee Boothby. "As the discoverer and founder of STACK, we have drilled more than a quarter of the play's total wells and are the proven leader. Time and again, we have demonstrated our ability to efficiently move large-scale resource plays from concept to discovery, through the HBP phase and into full-field development. We expect that this acquisition will create significant, incremental future value for our shareholders."
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on U.S. resource plays and our principal areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. We also have offshore oil developments in China.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this news release, all information and statements, including but not limited to information regarding acquisitions, use of cash, planned capital expenditures, estimated reserves, estimated production targets, drilling and development plans, the timing of production, planned capital expenditures, and other plans, strategies and objectives for future operations, are forward-looking statements. Although, as of the date of this news release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, China and U.S. governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to close on acquisitions, monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, and other operating risks. Please see Newfield's 2015 Annual Report on Form 10-K and Quarterly Report on Form 10-Q for 1Q 2016, both filed with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed herein or in Newfield's SEC filings could also have material adverse effects on actual results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
OKLAHOMA CITY, May 5, 2016 /PRNewswire/ -- Chesapeake Energy Corporation (NYSE:CHK) today reported financial and operational results for the 2016 first quarter. Highlights include:
Doug Lawler, Chesapeake's Chief Executive Officer, commented, "Chesapeake is delivering on all four of the focus points for 2016 that we stated in February: maximizing liquidity, optimizing our portfolio, increasing cash flow and reducing debt. We are pleased this morning to announce approximately $500 million of incremental asset sales above the $700 million we announced in late February. The STACK acreage sale we are announcing today accelerates value from a portion of our undeveloped acreage that currently generates very little cash flow, giving us the ability to enhance current liquidity. This transaction contributes substantially to achieving our previously announced target of an incremental $500 million to $1 billion of asset sales by year-end. We anticipate subsequent divestitures during the second and third quarters.
"Our cash costs continue to decline, and we remain sharply focused on improving our margins through continued progress with our midstream and downstream partners. As a result, we have recognized incremental improvements in both our production expense and our total gathering, processing and transportation expenses and revised our 2016 guidance accordingly. Additionally, since January 1, 2016, we have reduced debt that matures or can be put to us in 2017 by approximately $282 million. Our recently amended revolving credit facility agreement gives us sufficient liquidity and capacity to pursue additional reductions of our near-term maturities as opportunities arise."
2016 First Quarter Results
For the 2016 first quarter, Chesapeake reported a net loss available to common stockholders of $964 million, or $1.44 per fully diluted share. The primary driver of the net loss was a noncash impairment of the carrying value of Chesapeake's oil and natural gas properties of approximately $853 million, largely resulting from decreases in the trailing 12-month average first-day-of-the-month oil and natural gas prices as of March 31, 2016, compared to December 31, 2015. Adjusting for items that are typically excluded by securities analysts, including the impairment discussed above, the 2016 first quarter adjusted net loss available to common stockholders was $120 million, or $0.10 per fully diluted share. Reconciliations of financial measures calculated in accordance with generally accepted accounting principles to adjusted measures that are typically calculated by securities analysts are provided on pages 10 – 12 of this release.
Chesapeake's 2016 first quarter revenues declined by 39% year over year, primarily due to a decrease in the average realized commodity prices received for its production. Revenue declines due to lower commodity prices were partially offset by improvements to the company's production expenses and general and administrative (G&A) expenses. Average daily production for the 2016 first quarter of approximately 672,400 barrels of oil equivalent (boe) increased 1%, adjusted for asset sales, and consisted of approximately 95,700 barrels (bbls) of oil, 3.036 billion cubic feet (bcf) of natural gas and 70,700 bbls of natural gas liquids (NGL).
Chesapeake's cash expenses continue to decline due to its focus on cost discipline. Average production expenses during the 2016 first quarter were $3.36 per boe, a decrease of 31% from the 2015 first quarter. G&A expenses (including stock-based compensation) during the 2016 first quarter were $0.79 per boe, a decrease of 13% from the 2015 first quarter. Sequentially, the company's 2016 first quarter production expenses per boe and G&A expenses per boe (including stock-based compensation) declined 7% and 23%, respectively, compared to the 2015 fourth quarter. As a result of the company's cost reductions, Chesapeake has lowered its full-year 2016 guidance for production expenses.
Capital Spending Overview
Chesapeake's total capital investments were approximately $365 million during the 2016 first quarter, compared to approximately $1.5 billion in the 2015 first quarter, as summarized in the table below. A summary of the company's guidance for 2016 is provided in the Outlook dated May 5, 2016, beginning on Page 13.
2016 |
2015 |
2015 | ||||
Activity Comparison |
Q1 |
Q4 |
Q1 | |||
Average operated rig count |
8 |
14 |
54 | |||
Gross wells completed |
57 |
85 |
261 | |||
Gross wells spud |
41 |
66 |
244 | |||
Gross wells connected |
80 |
100 |
262 | |||
Type of Cost ($ in millions) |
||||||
Drilling and completion costs |
$ |
281 |
$ |
405 |
$ |
1,300 |
Exploration costs and additions to other PP&E |
16 |
55 |
63 | |||
Subtotal capital expenditures |
$ |
297 |
$ |
460 |
$ |
1,363 |
Capitalized interest |
68 |
88 |
123 | |||
Total capital expenditures |
$ |
365 |
$ |
548 |
$ |
1,486 |
Balance Sheet and Liquidity
As of March 31, 2016, Chesapeake's debt principal balance was approximately $9.4 billion, including approximately $367 million of borrowings outstanding on the company's $4.0 billion revolving credit facility, compared to $9.7 billion as of December 31, 2015, and $11.5 billion as of March 31, 2015. Since January 1, 2016, the company retired its 3.25% Senior Notes due March 15, 2016, and has repurchased or exchanged approximately $282 million of debt due or putable in 2017 at an average discount of approximately 39%.
In April, Chesapeake amended its $4.0 billion revolving credit facility maturing in 2019 to reaffirm its borrowing base, restructure financial covenants and increase its ability to issue secured debt. Under the new amendment, Chesapeake agreed to pledge additional assets as collateral. As part of the amendment, the next scheduled borrowing base redetermination review has been postponed until June 2017. Letters of credit issued under the credit facility were approximately $619 million as of March 31, 2016, which included a $461 million supersedeas bond supporting the company's appeal of the judgment issued in 2015 with respect to the company's 2019 Notes litigation.
Asset Divestitures Update
In 2016, Chesapeake has closed or has under signed sales agreements approximately $1.2 billion in gross proceeds from asset divestitures, or approximately $950 million in net proceeds after certain related repurchases of Volumetric Production Payment (VPP) obligations are met. Transactions signed since February 2016 include the sale of a portion of the company's acreage and producing properties in its STACK play in northern Oklahoma for approximately $470 million to Newfield Exploration Company (NYSE: NFX). Included in the sale are approximately 42,000 net acres and 400 producing wells which are currently producing 3,800 boe per day (approximately 55% liquids), net to Chesapeake. Substantially all of the company's announced asset divestitures are expected to close by the end of the third quarter. For the expected $950 million in net proceeds currently closed or signed in 2016, the net impact to the company's production is projected to be a reduction of approximately 35,000 boe per day (approximately 60% natural gas).
Key Financial and Operational Results
The table below summarizes Chesapeake's key financial and operational results during the 2016 first quarter as compared to results in prior periods.
Three Months Ended | |||||||||
03/31/16 |
12/31/15 |
03/31/15 | |||||||
Oil equivalent production (in mmboe) |
61 |
61 |
62 |
||||||
Oil production (in mmbbls) |
9 |
9 |
11 |
||||||
Average realized oil price ($/bbl)(a) |
37.74 |
64.04 |
65.73 |
||||||
Natural gas production (in bcf) |
276 |
268 |
264 |
||||||
Average realized natural gas price ($/mcf)(a) |
2.29 |
2.35 |
3.67 |
||||||
NGL production (in mmbbls) |
6 |
7 |
7 |
||||||
Average realized NGL price ($/bbl)(a) |
11.44 |
14.07 |
18.40 |
||||||
Production expenses ($/boe) |
(3.36) |
(3.62) |
(4.84) |
||||||
Gathering, processing and transportation expenses ($/boe) |
(7.88) |
(11.34) |
(7.40) |
||||||
Production taxes ($/boe) |
(0.30) |
(0.19) |
(0.45) |
||||||
General and administrative expenses ($/boe)(b) |
(0.66) |
(0.84) |
(0.72) |
||||||
Stock-based compensation ($/boe) |
(0.13) |
(0.18) |
(0.19) |
||||||
DD&A of oil and natural gas properties ($/boe) |
(4.43) |
(5.37) |
(11.08) |
||||||
DD&A of other assets ($/boe) |
(0.48) |
(0.50) |
(0.57) |
||||||
Interest expenses ($/boe)(a) |
(0.98) |
(1.70) |
(0.98) |
||||||
Marketing, gathering and compression net margin ($ in millions)(c) |
18 |
2 |
(25) |
||||||
Operating cash flow ($ in millions)(d) |
263 |
386 |
882 |
||||||
Operating cash flow ($/boe) |
4.29 |
6.35 |
14.29 |
||||||
Adjusted ebitda ($ in millions)(e) |
282 |
298 |
928 |
||||||
Adjusted ebitda ($/boe) |
4.61 |
4.90 |
15.02 |
||||||
Net loss available to common stockholders ($ in millions) |
(964) |
(2,228) |
(3,782) |
||||||
Earnings (loss) per share – diluted ($) |
(1.44) |
(3.36) |
(5.72) |
||||||
Adjusted net income (loss) available to common stockholders ($ in millions)(f) |
(120) |
(168) |
42 |
||||||
Adjusted earnings (loss) per share – diluted ($) |
(0.10) |
(0.16) |
0.11 |
(a) |
Includes the effects of realized gains (losses) from hedging, but excludes the effects of unrealized gains (losses) from hedging. |
(b) |
Excludes expenses associated with stock-based compensation and restructuring and other termination costs. |
(c) |
Includes revenue, operating expenses and $20 million, $5 million and a nominal amount of unrealized gains on supply contract derivatives for the three months ended March 31, 2016, December 31, 2015 and March 31, 2015, respectively. Excludes depreciation and amortization of other assets. |
(d) |
Defined as cash flow provided by operating activities before changes in assets and liabilities. |
(e) |
Defined as net income before interest expense, income taxes and depreciation, depletion and amortization expense, as adjusted to remove the effects of certain items detailed on page 12. |
(f) |
Defined as net income available to common stockholders, as adjusted to remove the effects of certain items detailed on page 10. |
2016 First Quarter Financial and Operational Results Conference Call Information
A conference call to discuss this release has been scheduled on Thursday, May 5, 2016, at 9:00 am EDT. The telephone number to access the conference call is 913-981-5571 or toll-free 888-211-7449. The passcode for the call is 8725419. The number to access the conference call replay is 719-457-0820 or toll-free 888-203-1112 and the passcode for the replay is 8725419. The conference call will also be webcast live at www.chk.com in the "Investors" section of the company's website. The webcast of the conference will be available on the website for one year.
Chesapeake Energy Corporation (NYSE:CHK) is the second-largest producer of natural gas and the 13th largest producer of oil and natural gas liquids in the United States. Headquartered in Oklahoma City, the company's operations are focused on discovering and developing its large and geographically diverse resource base of unconventional oil and natural gas assets onshore in the U.S. The company also owns oil and natural gas marketing and natural gas gathering and compression businesses. Further information is available at www.chk.com where Chesapeake routinely posts announcements, updates, events, investor information, presentations and news releases.
This news release and the accompanying Outlook include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are statements other than statements of historical fact. They include statements that give our current expectations or forecasts of future events, production and well connection forecasts, estimates of operating costs, anticipated capital and operational efficiencies, planned development drilling and expected drilling cost reductions, general and administrative expenses, capital expenditures, the timing of anticipated noncore asset sales and proceeds to be received therefrom, projected cash flow and liquidity, our ability to enhance our cash flow and financial flexibility, plans and objectives for future operations (including our ability to optimize base production and execute gas gathering agreements), the ability of our employees, portfolio strength and operational leadership to create long-term value, and the assumptions on which such statements are based. Although we believe the expectations and forecasts reflected in the forward-looking statements are reasonable, we can give no assurance they will prove to have been correct. They can be affected by inaccurate or changed assumptions or by known or unknown risks and uncertainties.
Factors that could cause actual results to differ materially from expected results include those described under "Risk Factors" in Item 1A of our annual report on Form 10-K and any updates to those factors set forth in Chesapeake's subsequent quarterly reports on Form 10-Q or current reports on Form 8-K (available at http://www.chk.com/investors/sec-filings). These risk factors include the the volatility of oil, natural gas and NGL prices; the limitations our level of indebtedness may have on our financial flexibility; our inability to access the capital markets on favorable terms or at all; the availability of cash flows from operations and other funds to finance reserve replacement costs or satisfy our debt obligations; a further downgrade in our credit rating requiring us to post more collateral under certain commercial arrangements; write-downs of our oil and natural gas asset carrying values due low commodity prices; our ability to replace reserves and sustain production; uncertainties inherent in estimating quantities of oil, natural gas and NGL reserves and projecting future rates of production and the amount and timing of development expenditures; our ability to generate profits or achieve targeted results in drilling and well operations; leasehold terms expiring before production can be established; commodity derivative activities resulting in lower prices realized on oil, natural gas and NGL sales; the need to secure derivative liabilities and the inability of counterparties to satisfy their obligations; adverse developments or losses from pending or future litigation and regulatory proceedings, including royalty claims; charges incurred in response to market conditions and in connection with our ongoing actions to reduce financial leverage and complexity; drilling and operating risks and resulting liabilities; effects of environmental protection laws and regulation on our business; legislative and regulatory initiatives further regulating hydraulic fracturing; our need to secure adequate supplies of water for our drilling operations and to dispose of or recycle the water used; impacts of potential legislative and regulatory actions addressing climate change; federal and state tax proposals affecting our industry; potential OTC derivatives regulation limiting our ability to hedge against commodity price fluctuations; competition in the oil and gas exploration and production industry; a deterioration in general economic, business or industry conditions; negative public perceptions of our industry; limited control over properties we do not operate; pipeline and gathering system capacity constraints and transportation interruptions; terrorist activities and cyber-attacks adversely impacting our operations; potential challenges of our spin-off of Seventy Seven Energy Inc. (SSE) in the event of a bankruptcy of SSE; an interruption in operations at our headquarters due to a catastrophic event; the continuation of suspended dividend payments on our common stock and preferred stock; certain anti-takeover provisions that affect shareholder rights; and our inability to increase or maintain our liquidity through debt repurchases, capital exchanges, asset sales, joint ventures, farmouts or other means.
In addition, disclosures concerning the estimated contribution of derivative contracts to our future results of operations are based upon market information as of a specific date. These market prices are subject to significant volatility. Our production forecasts are also dependent upon many assumptions, including estimates of production decline rates from existing wells and the outcome of future drilling activity. Expected asset sales may not be completed in the time frame anticipated or at all. We caution you not to place undue reliance on our forward-looking statements, which speak only as of the date of this news release, and we undertake no obligation to update any of the information provided in this release or the accompanying Outlook, except as required by applicable law.
CHESAPEAKE ENERGY CORPORATION | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
($ in millions, except per share data) | ||||||||
(unaudited) | ||||||||
Three Months Ended March 31, | ||||||||
2016 |
2015 | |||||||
REVENUES: |
||||||||
Oil, natural gas and NGL |
$ |
993 |
$ |
1,543 |
||||
Marketing, gathering and compression |
960 |
1,675 |
||||||
Total Revenues |
1,953 |
3,218 |
||||||
OPERATING EXPENSES: |
||||||||
Oil, natural gas and NGL production |
206 |
299 |
||||||
Oil, natural gas and NGL gathering, processing and transportation |
482 |
458 |
||||||
Production taxes |
18 |
28 |
||||||
Marketing, gathering and compression |
942 |
1,700 |
||||||
General and administrative |
48 |
56 |
||||||
Restructuring and other termination costs |
— |
(10) |
||||||
Provision for legal contingencies |
22 |
25 |
||||||
Oil, natural gas and NGL depreciation, depletion and amortization |
271 |
684 |
||||||
Depreciation and amortization of other assets |
29 |
35 |
||||||
Impairment of oil and natural gas properties |
853 |
4,976 |
||||||
Impairments of fixed assets and other |
38 |
4 |
||||||
Net (gains) losses on sales of fixed assets |
(4) |
3 |
||||||
Total Operating Expenses |
2,905 |
8,258 |
||||||
LOSS FROM OPERATIONS |
(952) |
(5,040) |
||||||
OTHER INCOME (EXPENSE): |
||||||||
Interest expense |
(62) |
(51) |
||||||
Losses on investments |
— |
(7) |
||||||
Loss on sale of investment |
(10) |
— |
||||||
Gains on purchases or exchanges of debt |
100 |
— |
||||||
Other income |
3 |
6 |
||||||
Total Other Income (Expense) |
31 |
(52) |
||||||
LOSS BEFORE INCOME TAXES |
(921) |
(5,092) |
||||||
INCOME TAX BENEFIT: |
||||||||
Current income taxes |
— |
— |
||||||
Deferred income taxes |
— |
(1,372) |
||||||
Total Income Tax Benefit |
— |
(1,372) |
||||||
NET LOSS |
(921) |
(3,720) |
||||||
Net income attributable to noncontrolling interests |
— |
(19) |
||||||
NET LOSS ATTRIBUTABLE TO CHESAPEAKE |
(921) |
(3,739) |
||||||
Preferred stock dividends |
(43) |
(43) |
||||||
NET LOSS AVAILABLE TO COMMON STOCKHOLDERS |
$ |
(964) |
$ |
(3,782) |
||||
LOSS PER COMMON SHARE: |
||||||||
Basic |
$ |
(1.44) |
$ |
(5.72) |
||||
Diluted |
$ |
(1.44) |
$ |
(5.72) |
||||
WEIGHTED AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING (in millions): |
||||||||
Basic |
668 |
661 |
||||||
Diluted |
668 |
661 |
CHESAPEAKE ENERGY CORPORATION | ||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
($ in millions) | ||||||||
(unaudited) | ||||||||
March 31, 2016 |
December 31, 2015 | |||||||
Cash and cash equivalents |
$ |
16 |
$ |
825 |
||||
Other current assets |
1,476 |
1,655 |
||||||
Total Current Assets |
1,492 |
2,480 |
||||||
Property and equipment, (net) |
13,291 |
14,298 |
||||||
Other assets |
574 |
536 |
||||||
Total Assets |
$ |
15,357 |
$ |
17,314 |
||||
Current liabilities |
$ |
2,833 |
$ |
3,685 |
||||
Long-term debt, net |
10,062 |
10,311 |
||||||
Other long-term liabilities |
891 |
921 |
||||||
Total Liabilities |
13,786 |
14,917 |
||||||
Preferred stock |
3,036 |
3,062 |
||||||
Noncontrolling interests |
260 |
259 |
||||||
Common stock and other stockholders' equity |
(1,725) |
(924) |
||||||
Total Equity |
1,571 |
2,397 |
||||||
Total Liabilities and Equity |
$ |
15,357 |
$ |
17,314 |
||||
Common shares outstanding (in millions) |
683 |
663 |
||||||
Principal amount of debt outstanding |
$ |
9,425 |
$ |
9,706 |
CHESAPEAKE ENERGY CORPORATION | ||||||||
SUPPLEMENTAL DATA – OIL, NATURAL GAS AND NGL PRODUCTION, SALES AND INTEREST EXPENSE | ||||||||
(unaudited) | ||||||||
Three Months Ended March 31, | ||||||||
2016 |
2015 | |||||||
Net Production: |
||||||||
Oil (mmbbl) |
9 |
11 |
||||||
Natural gas (bcf) |
276 |
264 |
||||||
NGL (mmbbl) |
6 |
7 |
||||||
Oil equivalent (mmboe) |
61 |
62 |
||||||
Oil, natural gas and NGL Sales ($ in millions): |
||||||||
Oil sales |
$ |
255 |
$ |
486 |
||||
Oil derivatives – realized gains (losses)(a) |
73 |
235 |
||||||
Oil derivatives – unrealized gains (losses)(a) |
(72) |
(110) |
||||||
Total Oil Sales |
256 |
611 |
||||||
Natural gas sales |
483 |
770 |
||||||
Natural gas derivatives – realized gains (losses)(a) |
150 |
200 |
||||||
Natural gas derivatives – unrealized gains (losses)(a) |
30 |
(164) |
||||||
Total Natural Gas Sales |
663 |
806 |
||||||
NGL sales |
74 |
126 |
||||||
Total NGL Sales |
74 |
126 |
||||||
Total Oil, Natural Gas and NGL Sales |
$ |
993 |
$ |
1,543 |
||||
Average Sales Price – excluding gains (losses) on derivatives: |
||||||||
Oil ($ per bbl) |
$ |
29.34 |
$ |
44.33 |
||||
Natural gas ($ per mcf) |
$ |
1.75 |
$ |
2.92 |
||||
NGL ($ per bbl) |
$ |
11.44 |
$ |
18.40 |
||||
Oil equivalent ($ per boe) |
$ |
13.28 |
$ |
22.36 |
||||
Average Sales Price – including realized gains (losses) on derivatives: |
||||||||
Oil ($ per bbl) |
$ |
37.74 |
$ |
65.73 |
||||
Natural gas ($ per mcf) |
$ |
2.29 |
$ |
3.67 |
||||
NGL ($ per bbl) |
$ |
11.44 |
$ |
18.40 |
||||
Oil equivalent ($ per boe) |
$ |
16.93 |
$ |
29.40 |
||||
Interest Expense ($ in millions): |
||||||||
Interest(b) |
$ |
62 |
$ |
62 |
||||
Interest rate derivatives – realized (gains) losses(c) |
(3) |
(1) |
||||||
Interest rate derivatives – unrealized (gains) losses(c) |
3 |
(10) |
||||||
Total Interest Expense |
$ |
62 |
$ |
51 |
(a) |
Realized gains and losses include the following items: (i) settlements of nondesignated derivatives related to current period production revenues, (ii) prior period settlements for option premiums and for early-terminated derivatives originally scheduled to settle against current period production revenues, and (iii) gains and losses related to de-designated cash flow hedges originally designated to settle against current period production revenues. Unrealized gains and losses include the change in fair value of open derivatives scheduled to settle against future period production revenues offset by amounts reclassified as realized gains and losses during the period. Although we no longer designate our derivatives as cash flow hedges for accounting purposes, we believe these definitions are useful to management and investors in determining the effectiveness of our price risk management program. |
(b) |
Net of amounts capitalized. |
(c) |
Realized (gains) losses include settlements related to the current period interest accrual and the effect of (gains) losses on early termination trades. Unrealized (gains) losses include changes in the fair value of open interest rate derivatives offset by amounts reclassified to realized (gains) losses during the period. |
CHESAPEAKE ENERGY CORPORATION | ||||||||
CONDENSED CONSOLIDATED CASH FLOW DATA | ||||||||
($ in millions) | ||||||||
(unaudited) | ||||||||
THREE MONTHS ENDED: |
March 31, 2016 |
March 31, 2015 | ||||||
Beginning cash |
$ |
825 |
$ |
4,108 |
||||
Net cash provided by (used in) operating activities |
(421) |
423 |
||||||
Cash flows from investing activities: |
||||||||
Drilling and completion costs(a) |
(265) |
(1,306) |
||||||
Acquisitions of proved and unproved properties(b) |
(67) |
(128) |
||||||
Proceeds from divestitures of proved and unproved properties |
62 |
21 |
||||||
Additions to other property and equipment(c) |
(10) |
(58) |
||||||
Proceeds from sales of other property and equipment |
9 |
2 |
||||||
Other |
(2) |
(3) |
||||||
Net cash used in investing activities |
(273) |
(1,472) |
||||||
Net cash used in financing activities |
(115) |
(152) |
||||||
Change in cash and cash equivalents |
(809) |
(1,201) |
||||||
Ending cash |
$ |
16 |
$ |
2,907 |
(a) |
Includes capitalized interest of $2 million and $11 million for the three months ended March 31, 2016 and 2015, respectively. |
(b) |
Includes capitalized interest of $64 million and $109 million for the three months ended March 31, 2016 and 2015, respectively. |
(c) |
Includes capitalized interest of $1 million and $1 million for the three months ended March 31, 2016 and 2015, respectively. |
CHESAPEAKE ENERGY CORPORATION | ||||||||||||
RECONCILIATION OF ADJUSTED NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | ||||||||||||
($ in millions, except per share data) | ||||||||||||
(unaudited) | ||||||||||||
THREE MONTHS ENDED: |
March 31, 2016 |
December 31, 2015 |
March 31, 2015 | |||||||||
Net loss available to common stockholders |
$ |
(964) |
$ |
(2,228) |
$ |
(3,782) |
||||||
Weighted average common and common equivalent shares outstanding (a) |
668 |
663 |
661 |
|||||||||
Loss per common share (diluted) |
(1.44) |
(3.36) |
(5.72) |
|||||||||
Adjustments, net of tax: |
||||||||||||
Unrealized losses on commodity and interest rate derivatives |
45 |
41 |
192 |
|||||||||
Unrealized gains on supply contract derivatives |
(20) |
(4) |
— |
|||||||||
Restructuring and other termination costs |
— |
(2) |
(7) |
|||||||||
Provision for legal contingencies |
22 |
(5) |
18 |
|||||||||
Impairment of oil and natural gas properties |
853 |
2,183 |
3,635 |
|||||||||
Impairments of fixed assets and other |
38 |
21 |
3 |
|||||||||
Net (gains) losses on sales of fixed assets |
(4) |
1 |
2 |
|||||||||
Impairment of investment |
— |
41 |
— |
|||||||||
Loss on sale of investment |
10 |
— |
— |
|||||||||
Gains on purchases or exchanges of debt |
(100) |
(215) |
— |
|||||||||
Tax rate adjustment |
— |
— |
(17) |
|||||||||
Other |
— |
(1) |
(2) |
|||||||||
Adjusted net income (loss) available to common stockholders(b) |
$ |
(120) |
$ |
(168) |
$ |
42 |
||||||
Preferred stock dividends |
43 |
43 |
43 |
|||||||||
Total adjusted net income (loss) attributable to Chesapeake |
$ |
(77) |
$ |
(125) |
$ |
85 |
||||||
Weighted average fully diluted shares outstanding (in millions)(c) |
781 |
777 |
776 |
|||||||||
Adjusted earnings (loss) per share assuming dilution(b) |
$ |
(0.10) |
$ |
(0.16) |
$ |
0.11 |
(a) |
Weighted average common and common equivalent shares outstanding do not include shares that were considered antidilutive for calculating earnings per share in accordance with GAAP. | |
(b) |
Adjusted net income and adjusted earnings per share assuming dilution are not measures of financial performance under accounting principles generally accepted in the United States (GAAP), and should not be considered as an alternative to net income available to common stockholders or diluted earnings per share. Adjusted net income available to common stockholders and adjusted earnings per share assuming dilution exclude certain items that management believes affect the comparability of operating results. The company believes these adjusted financial measures are a useful adjunct to earnings calculated in accordance with GAAP because: | |
(i) |
Management uses adjusted net income available to common stockholders to evaluate the company's operational trends and performance relative to other oil and natural gas producing companies. | |
(ii) |
Adjusted net income available to common stockholders is more comparable to earnings estimates provided by securities analysts. | |
(iii) |
Items excluded generally are one-time items or items whose timing or amount cannot be reasonably estimated. Accordingly, any guidance provided by the company generally excludes information regarding these types of items. | |
(c) |
Weighted average fully diluted shares outstanding include shares that were considered antidilutive for calculating earnings per share in accordance with GAAP. |
CHESAPEAKE ENERGY CORPORATION | ||||||||||||
RECONCILIATION OF OPERATING CASH FLOW AND EBITDA | ||||||||||||
($ in millions) | ||||||||||||
(unaudited) | ||||||||||||
THREE MONTHS ENDED: |
March 31, 2016 |
December 31, 2015 |
March 31, 2015 | |||||||||
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES |
$ |
(421) |
$ |
179 |
$ |
423 |
||||||
Changes in assets and liabilities |
684 |
207 |
459 |
|||||||||
OPERATING CASH FLOW(a) |
$ |
263 |
$ |
386 |
$ |
882 |
||||||
THREE MONTHS ENDED: |
March 31, 2016 |
December 31, 2015 |
March 31, 2015 | |||||||||
NET LOSS |
$ |
(921) |
$ |
(2,185) |
$ |
(3,720) |
||||||
Interest expense |
62 |
107 |
51 |
|||||||||
Income tax benefit |
— |
(649) |
(1,372) |
|||||||||
Depreciation and amortization of other assets |
29 |
30 |
35 |
|||||||||
Oil, natural gas and NGL depreciation, depletion and amortization |
271 |
326 |
684 |
|||||||||
EBITDA(b) |
$ |
(559) |
$ |
(2,371) |
$ |
(4,322) |
||||||
THREE MONTHS ENDED: |
March 31, 2016 |
December 31, 2015 |
March 31, 2015 | |||||||||
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES |
$ |
(421) |
$ |
179 |
$ |
423 |
||||||
Changes in assets and liabilities |
684 |
207 |
459 |
|||||||||
Interest expense, net of unrealized gains (losses) on derivatives |
59 |
104 |
61 |
|||||||||
Gains on commodity derivatives, net |
181 |
284 |
161 |
|||||||||
Gains on supply contract derivative, net |
20 |
5 |
— |
|||||||||
Cash receipts on commodity derivative settlements, net |
(267) |
(273) |
(413) |
|||||||||
Stock-based compensation |
(12) |
(17) |
(23) |
|||||||||
Restructuring and other termination costs |
— |
3 |
10 |
|||||||||
Provision for legal contingencies |
(22) |
19 |
(25) |
|||||||||
Impairment of oil and natural gas properties |
(853) |
(2,831) |
(4,976) |
|||||||||
Impairments of fixed assets and other |
(33) |
(16) |
(2) |
|||||||||
Net gains (losses) on sales of fixed assets |
4 |
(1) |
(3) |
|||||||||
Investment activity |
(10) |
(92) |
(7) |
|||||||||
Gains on purchases or exchanges of debt |
100 |
304 |
— |
|||||||||
Other items |
11 |
(246) |
13 |
|||||||||
EBITDA(b) |
$ |
(559) |
$ |
(2,371) |
$ |
(4,322) |
(a) |
Operating cash flow represents net cash provided by operating activities before changes in assets and liabilities. Operating cash flow is presented because management believes it is a useful adjunct to net cash provided by operating activities under GAAP. Operating cash flow is widely accepted as a financial indicator of an oil and natural gas company's ability to generate cash that is used to internally fund exploration and development activities and to service debt. This measure is widely used by investors and rating agencies in the valuation, comparison, rating and investment recommendations of companies within the oil and natural gas exploration and production industry. Operating cash flow is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing or financing activities as an indicator of cash flows, or as a measure of liquidity. |
(b) |
Ebitda represents net income before interest expense, income taxes, and depreciation, depletion and amortization expense. Ebitda is presented as a supplemental financial measurement in the evaluation of our business. We believe that it provides additional information regarding our ability to meet our future debt service, capital expenditures and working capital requirements. This measure is widely used by investors and rating agencies in the valuation, comparison, rating and investment recommendations of companies. Ebitda is also a financial measurement that, with certain negotiated adjustments, is reported to our lenders pursuant to our bank credit agreements and is used in the financial covenants in our bank credit agreements. Ebitda is not a measure of financial performance under GAAP. Accordingly, it should not be considered as a substitute for net income, income from operations or cash flow provided by operating activities prepared in accordance with GAAP. |
CHESAPEAKE ENERGY CORPORATION | ||||||||||||
RECONCILIATION OF ADJUSTED EBITDA | ||||||||||||
($ in millions) | ||||||||||||
(unaudited) | ||||||||||||
THREE MONTHS ENDED: |
March 31, 2016 |
December 31, 2015 |
March 31, 2015 | |||||||||
EBITDA |
$ |
(559) |
$ |
(2,371) |
$ |
(4,322) |
||||||
Adjustments: |
||||||||||||
Unrealized losses on commodity derivatives |
42 |
51 |
274 |
|||||||||
Unrealized gains on supply contract derivatives |
(20) |
(5) |
— |
|||||||||
Restructuring and other termination costs |
— |
(3) |
(10) |
|||||||||
Provision for legal contingencies |
22 |
(6) |
25 |
|||||||||
Impairment of oil and natural gas properties |
853 |
2,831 |
4,976 |
|||||||||
Impairments of fixed assets and other |
38 |
27 |
4 |
|||||||||
Net (gains) losses on sales of fixed assets |
(4) |
1 |
3 |
|||||||||
Impairment of investment |
— |
53 |
— |
|||||||||
Loss on sale of investment |
10 |
— |
— |
|||||||||
Gains on purchases or exchanges of debt |
(100) |
(279) |
— |
|||||||||
Net income attributable to noncontrolling interests |
— |
— |
(19) |
|||||||||
Other |
— |
(1) |
(3) |
|||||||||
Adjusted EBITDA(a) |
$ |
282 |
$ |
298 |
$ |
928 |
(a) |
Adjusted ebitda excludes certain items that management believes affect the comparability of operating results. The company believes these non-GAAP financial measures are a useful adjunct to ebitda because: | |
(i) |
Management uses adjusted ebitda to evaluate the company's operational trends and performance relative to other oil and natural gas producing companies. | |
(ii) |
Adjusted ebitda is more comparable to estimates provided by securities analysts. | |
(iii) |
Items excluded generally are one-time items or items whose timing or amount cannot be reasonably estimated. Accordingly, any guidance provided by the company generally excludes information regarding these types of items. | |
Accordingly, adjusted EBITDA should not be considered as a substitute for net income, income from operations or cash flow provided by operating activities prepared in accordance with GAAP. |
CHESAPEAKE ENERGY CORPORATION | |
MANAGEMENT'S OUTLOOK AS OF MAY 5, 2016 | |
Chesapeake periodically provides guidance on certain factors that affect the company's future financial performance. Changes from the company's February 24, 2016 Outlook are italicized bold below. | |
Year Ending 12/31/2016 | |
Adjusted Production Growth(a) |
(5%) to 0% |
Absolute Production |
|
Liquids - mmbbls |
55 - 59 |
Oil - mmbbls |
34 - 36 |
NGL - mmbbls |
21 - 23 |
Natural gas - bcf |
1,000 - 1,040 |
Total absolute production - mmboe |
222 - 232 |
Absolute daily rate - mboe |
605 - 635 |
Estimated Realized Hedging Effects(b) (based on 5/3/16 strip prices): |
|
Oil - $/bbl |
$3.63 |
Natural gas - $/mcf |
$0.25 |
NGL - $/bbl |
($0.30) |
Estimated Basis to NYMEX Prices: |
|
Oil - $/bbl |
$2.35 - $2.55 |
Natural gas - $/mcf |
$0.30 - $0.40 |
NGL - $/bbl |
$4.95 - $5.20 |
Operating Costs per Boe of Projected Production: |
|
Production expense |
$3.40 - $3.60 |
Gathering, processing and transportation expenses |
$7.60 - $8.10 |
Oil - $/bbl |
$3.75 - $3.95 |
Natural Gas(c) - $/mcf |
$1.40 - $1.50 |
NGL - $/bbl |
$7.60 - $7.85 |
Production taxes |
$0.35 - $0.45 |
General and administrative(d) |
$0.60 - $0.70 |
Stock-based compensation (noncash) |
$0.10 - $0.20 |
DD&A of natural gas and liquids assets |
$3.50 - $4.50 |
Depreciation of other assets |
$0.50 - $0.60 |
Interest expense(e) |
$1.05 - $1.15 |
Marketing, gathering and compression net margin(f) |
($20) - ($40) |
Book Tax Rate |
0% |
Capital Expenditures ($ in millions)(g) |
$1,000 - $1,500 |
Capitalized Interest ($ in millions) |
$260 |
Total Capital Expenditures ($ in millions) |
$1,260 - $1,760 |
(a) |
Based on 2015 production of 623 mboe per day, adjusted for 2015 and 2016 sales. |
(b) |
Includes expected settlements for commodity derivatives adjusted for option premiums. For derivatives closed early, settlements are reflected in the period of original contract expiration. |
(c) |
Excludes a 2016 fourth quarter minimum volume commitment (MVC) shortfall estimate of approximately $165 to $175 million. |
(d) |
Excludes expenses associated with stock-based compensation. |
(e) |
Excludes unrealized gains (losses) on interest rate derivatives. |
(f) |
Includes revenue and operating expenses. Excludes depreciation and amortization of other assets and unrealized gains (losses) on supply contract derivatives. |
(g) |
Includes capital expenditures for drilling and completion, leasehold, geological and geophysical costs, rig termination payments and other property and plant and equipment and excludes approximately $245 million for the expected repurchase of overriding royalty interests associated with the expected sale of certain of the company's properties. |
Oil, Natural Gas and Natural Gas Liquids Hedging Activities
Chesapeake enters into commodity derivative transactions in order to mitigate a portion of its exposure to adverse changes in market prices. Please see the quarterly reports on Form 10-Q and annual reports on Form 10-K filed by Chesapeake with the SEC for detailed information about derivative instruments the company uses, its quarter-end derivative positions and accounting for oil, natural gas and natural gas liquids derivatives.
As of May 3, 2016, the company had downside protection, through open swaps, on a portion of its remaining 2016 oil production at an average price of $46.32 per bbl. The company had downside price protection, through open swaps, on a portion of its remaining 2016 natural gas production at an average price of $2.71 per mcf. Chesapeake also had downside price protection, through open swaps, on a portion of its remaining 2016 ethane and propane production at an average price of $0.17 per gallon and $0.46 per gallon, respectively.
The company's crude oil hedging positions as of May 3, 2016 were as follows:
Open Crude Oil Swaps; Gains from Closed | |||||||||||||
Crude Oil Trades and Call Option Premiums | |||||||||||||
Open Swaps (mbbls) |
Avg. NYMEX Price of Open Swaps |
Total Gains from and Premiums for Call Options ($ in millions) | |||||||||||
Q2 2016 |
6,279 |
$ |
45.86 |
$ |
9 | ||||||||
Q3 2016 |
5,980 |
$ |
46.31 |
10 | |||||||||
Q4 2016 |
5,980 |
$ |
46.80 |
10 | |||||||||
Total 2016 (a) |
18,239 |
$ |
46.32 |
$ |
29 | ||||||||
Total 2017 – 2022 |
2,920 |
$ |
42.53 |
$ |
78 |
(a) Certain hedging arrangements include a sold option to extend at an average price of $53.67 per bbl covering 2.2 mmbbls in 2016. Sold options are included with net written call options. |
Crude Oil Net Written Call Options | ||||
Call Options (mbbls) |
Avg. NYMEX Strike Price | |||
Q2 2016 |
3,451 |
$ |
87.25 | |
Q3 2016 |
3,489 |
$ |
87.25 | |
Q4 2016 |
3,488 |
$ |
87.25 | |
Total 2016 |
10,428 |
$ |
87.25 | |
Total 2017 |
5,293 |
$ |
83.50 |
The company's natural gas hedging positions as of May 3, 2016 were as follows:
Open Natural Gas Swaps; Gains (Losses) from Closed | |||||||
Natural Gas Trades and Call Option Premiums | |||||||
Open Swaps (bcf) |
Avg. NYMEX Price of Open Swaps |
Total Losses from Closed Trades and Premiums for Call Options ($ in millions) | |||||
Q2 2016 |
174 |
$ |
2.65 |
$ |
(26) | ||
Q3 2016 |
179 |
$ |
2.69 |
(26) | |||
Q4 2016 |
123 |
$ |
2.84 |
(28) | |||
Total 2016 (a) |
476 |
$ |
2.71 |
$ |
(80) | ||
Total 2017 – 2022 |
73 |
$ |
2.92 |
$ |
(78) |
(a) Certain hedging arrangements include a sold option to extend at an average price of $2.80 per mmbtu covering 77 bcf in 2016. Sold options are included with net written call options. |
Natural Gas Net Written Call Options | ||||
Call Options (bcf) |
Avg. NYMEX Strike Price | |||
Q2 2016 |
45 |
$ |
5.27 | |
Q3 2016 |
45 |
$ |
5.27 | |
Q4 2016 |
46 |
$ |
5.27 | |
Total 2016 |
136 |
$ |
5.27 | |
Total 2017 – 2022 |
114 |
$ |
10.92 | |
Natural Gas Basis Protection Swaps | ||||
Volume (bcf) |
Avg. NYMEX | |||
Q2 2016 |
10 |
$ |
(0.63) | |
Q3 2016 |
12 |
$ |
(0.66) | |
Q4 2016 |
8 |
$ |
(0.58) | |
Total 2016 |
30 |
$ |
(0.63) | |
Total 2017 - 2022 |
24 |
$ |
(0.48) |
The company's natural gas liquids hedging positions as of May 3, 2016 were as follows:
Open Ethane Swaps | ||||
Volume (mmgal) |
Avg. NYMEX | |||
Q2 2016 |
57 |
$ |
0.17 | |
Q3 2016 |
58 |
$ |
0.17 | |
Q4 2016 |
20 |
$ |
0.17 | |
Total 2016 |
135 |
$ |
0.17 | |
Open Propane Swaps | ||||
Volume (mmgal) |
Avg. NYMEX | |||
Q2 2016 |
50 |
$ |
0.46 | |
Q3 2016 |
50 |
$ |
0.46 | |
Q4 2016 |
17 |
$ |
0.46 | |
Total 2016 |
117 |
$ |
0.46 |
INVESTOR CONTACT: |
MEDIA CONTACT: |
Brad Sylvester, CFA |
Gordon Pennoyer |
(405) 935-8870 |
(405) 935-8878 |
ir@chk.com |
media@chk.com |
SOURCE Chesapeake Energy Corporation
THE WOODLANDS, Texas, May 3, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today reported its first quarter 2016 unaudited financial and operating results. Additional operational details can be found in the Company's @NFX publication, located on its website.
Newfield plans to host a conference call at 10 a.m. CDT on May 4, 2016. To listen to the call, please visit Newfield's website at http://www.newfield.com. To participate in the call, dial 785-830-7977 and enter conference code 5140605 about 10 minutes prior to the scheduled start time.
"Newfield posted solid results for the first quarter and we are delivering on the objectives outlined in our near-term business plan," said Newfield Chairman Lee K. Boothby. "We have taken strategic steps to preserve liquidity and strengthen our balance sheet while reducing expenses across the organization. Despite today's backdrop of lower commodity prices, we are improving our margins and outlook on future returns – particularly in the Anadarko Basin where well costs and margins continue to move in the right direction. Today, we raised our outlook for 2016 production and reiterated our guidance around lower operating expenses."
First Quarter 2016 Financial and Production Summary
For the first quarter, the Company recorded a net loss of $624 million, or $3.52 per diluted share (all per share amounts are on a diluted basis). The loss was primarily related to a full-cost ceiling test impairment of $506 million, or $2.85 per share. After adjusting for the effect of impairments, credit facility amendment fees and unrealized derivative losses, the net loss for the first quarter would have been $16 million, or $0.09 per share.
Revenues for the first quarter were $284 million. Net cash provided by operating activities was approximately $72 million. Net cash provided by operating activities before changes in operating assets and liabilities was $170 million.
Newfield's total net production in the first quarter of 2016 was 15.2 MMBOE, comprised of 46% oil, 16% natural gas liquids and 38% natural gas. Domestic production in the first quarter was 13.5 MMBOE.
2016 Production Guidance and Capital Investments
Newfield increased its 2016 domestic net production guidance to 50 – 52 MMBOE (previous forecast: 49 – 51.0 MMBOE). Total Company net production guidance was raised to 54.5 – 56.5 (previous forecast: 53.3 – 55.3 MMBOE). Newfield is planning to commence drilling later this year on two infill spacing pilots in STACK. The pilots will test well spacing and include multiple wells on single pad locations. Newfield estimates it will be able to conduct the pilots within its previously stated 2016 capital investment outlook of $625 – $675 million (excludes capitalized interest and direct internal costs).
2016e Production, Cost and Expense Guidance
Domestic |
China |
Total |
||||
Production: |
||||||
Oil (Mmbls) |
20.0 – 20.6 |
4.5 |
24.5 – 25.1 |
|||
NGLs (Mmbls) |
9.2 – 9.6 |
– |
9.2 – 9.6 |
|||
Natural gas (Bcf) |
125 – 130 |
– |
125 – 130 |
|||
Total (Mmboe) |
50.0 – 52.0 |
4.5 |
54.5 – 56.5 |
|||
Expenses ($ mm)1 |
||||||
LOE2 |
$200 |
$54 |
$254 |
|||
Transportation3 |
260 |
– |
260 |
|||
Production & other taxes |
45 |
1 |
46 |
|||
General & administrative (G&A), net |
$165 |
$7 |
$172 |
|||
Interest expense |
154 |
– |
154 |
|||
Capitalized interest and direct internal costs |
($103) |
– |
($103) |
|||
Effective Tax rate4 |
2% |
1% |
1% |
|||
Note: Based on strip commodity prices in 2016 |
1Cost and expenses are expected to be within 5% of the estimates above |
2Total LOE includes recurring, major expense and non E&P operating expenses |
3Estimated transportation / processing fees include ~$52MM Arkoma unused firm gas transportation and ~$21MM Uinta oil and gas delivery shortfall fees |
4The effective tax rate reflects expected future valuation allowances recorded against deferred tax assets generated by ceiling test impairments. |
2Q16e Production, Cost and Expense Guidance
Domestic |
China |
Total |
||||
Production: |
||||||
Oil (Mmbls) |
5.0 – 5.2 |
1.4 |
6.4 – 6.6 |
|||
NGLs (Mmbls) |
2.5 – 2.8 |
– |
2.5 – 2.8 |
|||
Natural gas (Bcf) |
33 |
– |
33 |
|||
Total (Mmboe) |
13.0 – 13.5 |
1.4 |
14.4 – 14.9 |
|||
Expenses ($ mm)1 |
||||||
LOE2 |
$50 |
$14 |
$64 |
|||
Transportation3 |
66 |
– |
66 |
|||
Production & other taxes |
11 |
– |
11 |
|||
General & administrative (G&A), net |
$42 |
2 |
$44 |
|||
Interest expense |
38 |
– |
38 |
|||
Capitalized interest and direct internal costs |
($26) |
– |
($26) |
|||
Effective Tax rate4 |
2% |
1% |
1% |
|||
Note: Based on strip commodity prices in 2016 |
1Cost and expenses are expected to be within 5% of the estimates above |
2Total LOE includes recurring, major expense and non E&P operating expenses |
3Estimated transportation / processing fees include ~$13MM Arkoma unused firm gas transportation and ~$3MM Uinta oil and gas delivery shortfall fees |
4 The effective tax rate reflects expected future valuation allowances recorded against deferred tax assets generated by ceiling test impairments. |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on U.S. resource plays and our principal areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. We also have offshore oil developments in China.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "may," "believe," "expect," "anticipate," "intend," "estimate," "project," "target," "goal," "plan," "should," "will," "predict," "guidance," "potential" or other similar expressions are intended to identify forward-looking statements. Other than historical facts included in this news release, all information and statements, including but not limited to information regarding planned capital expenditures, estimated reserves, estimated production targets, drilling and development plans, the timing of production, planned capital expenditures, and other plans and objectives for future operations, are forward-looking statements. Although, as of the date of this news release, Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including but not limited to commodity prices, drilling results, our liquidity and the availability of capital resources, operating risks, industry conditions, China and U.S. governmental regulations, financial counterparty risks, the prices of goods and services, the availability of drilling rigs and other support services, our ability to monetize assets and repay or refinance our existing indebtedness, labor conditions, severe weather conditions, and other operating risks. Please see Newfield's 2015 Annual Report on Form 10-K and Quarterly Report on Form 10-Q for 1Q 2016, both filed with the U.S. Securities and Exchange Commission (SEC), for a discussion of other factors that may cause actual results to vary. Unpredictable or unknown factors not discussed herein or in Newfield's SEC filings could also have material adverse effects on actual results. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
1Q16 Actual Results |
Domestic |
China |
Total | |||||||||||||||
Production/Liftings1 |
||||||||||||||||||
Crude oil and condensate (MMBbls) |
5.3 |
1.7 |
7.0 | |||||||||||||||
Natural gas (Bcf) |
34.4 |
— |
34.4 | |||||||||||||||
NGLs (MMBbls) |
2.5 |
— |
2.5 | |||||||||||||||
Total (MMBOE) |
13.5 |
1.7 |
15.2 | |||||||||||||||
Average Realized Prices2, 3 |
||||||||||||||||||
Crude oil and condensate (per Bbl) |
$ |
38.96 |
$ |
29.89 |
$ |
36.82 | ||||||||||||
Natural gas (per Mcf) |
2.18 |
— |
2.18 | |||||||||||||||
NGLs (per Bbl) |
14.75 |
— |
14.75 | |||||||||||||||
Crude oil equivalent (per BOE) |
$ |
23.79 |
$ |
29.89 |
$ |
24.46 | ||||||||||||
Operating Expenses:3 |
||||||||||||||||||
Lease operating (in millions) |
||||||||||||||||||
Recurring |
$ |
43.0 |
$ |
14.3 |
$ |
57.3 | ||||||||||||
Major (workovers, etc.) |
$ |
3.6 |
$ |
— |
$ |
3.6 | ||||||||||||
Lease operating (per BOE) |
||||||||||||||||||
Recurring |
$ |
3.24 |
$ |
8.69 |
$ |
3.84 | ||||||||||||
Major (workovers, etc.) |
$ |
0.27 |
$ |
0.03 |
$ |
0.25 | ||||||||||||
Transportation and processing (in millions) |
$ |
63.4 |
$ |
— |
$ |
63.4 | ||||||||||||
per BOE |
$ |
4.77 |
$ |
— |
$ |
4.25 | ||||||||||||
Production and other taxes (in millions) |
$ |
9.5 |
$ |
0.2 |
$ |
9.7 | ||||||||||||
per BOE |
$ |
0.71 |
$ |
0.11 |
$ |
0.65 | ||||||||||||
General and administrative (G&A), net (in millions) |
$ |
42.5 |
$ |
1.4 |
$ |
43.9 | ||||||||||||
per BOE |
$ |
3.20 |
$ |
0.85 |
$ |
2.94 | ||||||||||||
Capitalized direct internal costs (in millions) |
$ |
(17.2) | ||||||||||||||||
per BOE |
$ |
(1.15) | ||||||||||||||||
Other operating expenses, net (in millions) |
$ |
0.9 | ||||||||||||||||
per BOE |
$ |
0.06 | ||||||||||||||||
Interest expense (in millions) |
$ |
41.1 | ||||||||||||||||
per BOE |
$ |
2.75 | ||||||||||||||||
Capitalized interest (in millions) |
$ |
(9.3) | ||||||||||||||||
per BOE |
$ |
(0.62) | ||||||||||||||||
Other non-operating (income) expense (in millions) |
$ |
(0.5) | ||||||||||||||||
per BOE |
$ |
(0.03) |
____ Note 1: Represents volumes lifted and sold regardless of when produced. Includes natural gas produced and consumed in operations of 1.5 Bcf during the three months ended March 31, 2016. | ||||||||||||||||||
Note 2: Average realized prices include the effects of derivative contracts. Excluding these effects, the average realized price for domestic and total natural gas would have been $1.83 per Mcf and the average realized price for our domestic and total crude oil and condensate would have been $25.72 per barrel and $26.70 per barrel, respectively. We did not have any derivative contracts associated with our NGL or China production as of March 31, 2016. | ||||||||||||||||||
Note 3: All per unit pricing and expenses exclude natural gas produced and consumed in operations. | ||||||||||||||||||
CONSOLIDATED STATEMENT OF OPERATIONS | ||||||||||||||
(Unaudited, in millions, except per share data) | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2016 |
2015 | |||||||||||||
Oil, gas and NGL revenues |
$ |
284 |
$ |
349 | ||||||||||
Operating expenses: |
||||||||||||||
Lease operating |
61 |
75 | ||||||||||||
Transportation and processing |
63 |
49 | ||||||||||||
Production and other taxes |
10 |
13 | ||||||||||||
Depreciation, depletion and amortization |
177 |
237 | ||||||||||||
General and administrative |
44 |
63 | ||||||||||||
Ceiling test and other impairments |
506 |
792 | ||||||||||||
Other |
1 |
4 | ||||||||||||
Total operating expenses |
862 |
1,233 | ||||||||||||
Income (loss) from operations |
(578) |
(884) | ||||||||||||
Other income (expense): |
||||||||||||||
Interest expense |
(41) |
(44) | ||||||||||||
Capitalized interest |
9 |
7 | ||||||||||||
Commodity derivative income (expense) |
(17) |
153 | ||||||||||||
Other, net |
1 |
8 | ||||||||||||
Total other income (expense) |
(48) |
124 | ||||||||||||
Income (loss) before income taxes |
(626) |
(760) | ||||||||||||
Income tax provision (benefit) |
(2) |
(280) | ||||||||||||
Net income (loss) |
$ |
(624) |
$ |
(480) | ||||||||||
Earnings (loss) per share: |
||||||||||||||
Basic |
$ |
(3.52) |
$ |
(3.30) | ||||||||||
Diluted |
$ |
(3.52) |
$ |
(3.30) | ||||||||||
Weighted-average number of shares outstanding for basic earnings (loss) per share |
177 |
145 | ||||||||||||
Weighted-average number of shares outstanding for diluted earnings (loss) per share |
177 |
145 | ||||||||||||
CONDENSED CONSOLIDATED BALANCE SHEET |
||||||
(Unaudited, in millions) |
||||||
March 31, |
December 31, | |||||
2016 |
2015 | |||||
ASSETS |
||||||
Current assets: |
||||||
Cash and cash equivalents |
$ |
537 |
$ |
5 | ||
Derivative assets |
234 |
284 | ||||
Other current assets |
317 |
336 | ||||
Total current assets |
1,088 |
625 | ||||
Oil and gas properties, net (full cost method) |
3,403 |
3,819 | ||||
Derivative assets |
65 |
105 | ||||
Other assets |
221 |
219 | ||||
Total assets |
$ |
4,777 |
$ |
4,768 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY |
||||||
Current liabilities: |
||||||
Derivative liabilities |
$ |
24 |
$ |
13 | ||
Other current liabilities |
501 |
634 | ||||
Total current liabilities |
525 |
647 | ||||
Other liabilities |
59 |
48 | ||||
Derivative liabilities |
7 |
9 | ||||
Long-term debt |
2,429 |
2,467 | ||||
Asset retirement obligations |
193 |
192 | ||||
Deferred taxes |
26 |
26 | ||||
Total long-term liabilities |
2,714 |
2,742 | ||||
Stockholders' equity: |
||||||
Common stock, treasury stock and additional paid-in capital |
3,199 |
2,416 | ||||
Accumulated other comprehensive gain (loss) |
(2) |
(2) | ||||
Retained earnings (deficit) |
(1,659) |
(1,035) | ||||
Total stockholders' equity |
1,538 |
1,379 | ||||
Total liabilities and stockholders' equity |
$ |
4,777 |
$ |
4,768 | ||
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited, in millions) |
||||||||||||
Three Months Ended March 31, |
||||||||||||
2016 |
2015 |
|||||||||||
Cash flows from operating activities: |
||||||||||||
Net income (loss) |
$ |
(624) |
$ |
(480) |
||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
||||||||||||
Depreciation, depletion and amortization |
177 |
237 |
||||||||||
Deferred tax provision (benefit) |
— |
(283) |
||||||||||
Stock-based compensation |
8 |
15 |
||||||||||
Unrealized (gain) loss on derivative contracts |
99 |
(32) |
||||||||||
Ceiling test and other impairments |
506 |
792 |
||||||||||
Other, net |
4 |
6 |
||||||||||
170 |
255 |
|||||||||||
Changes in operating assets and liabilities |
(98) |
(50) |
||||||||||
Net cash provided by (used in) operating activities |
72 |
205 |
||||||||||
Cash flows from investing activities: |
||||||||||||
Additions and acquisitions of oil and gas properties and other |
(278) |
(515) |
||||||||||
Proceeds from sales of oil and gas properties |
3 |
29 |
||||||||||
Net cash provided by (used in) investing activities |
(275) |
(486) |
||||||||||
Cash flows from financing activities: |
||||||||||||
Net proceeds (repayments) of borrowings under credit arrangements |
(39) |
(446) |
||||||||||
Proceeds from issuance of senior notes |
— |
691 |
||||||||||
Debt issue costs |
— |
(8) |
||||||||||
Proceeds from issuances of common stock, net |
776 |
815 |
||||||||||
Other, net |
(2) |
(2) |
||||||||||
Net cash provided by (used in) financing activities |
735 |
1,050 |
||||||||||
Increase (decrease) in cash and cash equivalents |
532 |
769 |
||||||||||
Cash and cash equivalents, beginning of period |
5 |
14 |
||||||||||
Cash and cash equivalents, end of period |
$ |
537 |
$ |
783 |
||||||||
Explanation and Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Earnings Stated Without the Effect of Certain Items)
Earnings stated without the effect of certain items is a non-GAAP financial measure. Earnings without the effect of these items are presented because they affect the comparability of operating results from period to period. In addition, earnings without the effect of these items are more comparable to earnings estimates provided by securities analysts. This measure should not be considered an alternative to net income (loss) as defined by generally accepted accounting principles.
A reconciliation of earnings for the first quarter of 2016 stated without the effect of certain items to net income (loss) is shown below:
1Q16 | |||||||||||||
(in millions) | |||||||||||||
Net Income (loss) |
$ |
(624) | |||||||||||
Ceiling test impairments |
506 | ||||||||||||
Unrealized (gain) loss on derivative contracts |
99 | ||||||||||||
Credit facility amendment fees |
3 | ||||||||||||
Income tax adjustment for above items(1) |
— | ||||||||||||
Earnings stated without the effect of the above items |
$ |
(16) | |||||||||||
(1) Our effective tax rate is less than 1% due to valuation allowances on our deferred tax assets. |
Net Cash Provided by Operating Activities Before Changes in Operating Assets and Liabilities
Net cash provided by operating activities before changes in operating assets and liabilities is presented because of its acceptance as an indicator of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur additional debt. This measure should not be considered an alternative to net cash provided by operating activities as defined by generally accepted accounting principles.
A reconciliation of net cash provided by operating activities to net cash provided by operating activities before changes in operating assets and liabilities is shown below:
1Q16 | |||
(in millions) | |||
Net cash provided by operating activities |
$ |
72 | |
Net changes in operating assets and liabilities |
98 | ||
Net cash provided by operating activities before changes in operating assets and liabilities |
$ |
170 | |
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, March 31, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) will host its first quarter 2016 earnings conference call at 10:00 a.m. (CT), Wednesday, May 4, 2016. The Company plans to release its first quarter earnings after market close on May 3, 2016.
To participate in the conference call, please dial (785) 830-7977 and provide conference code 5140605 about 10 minutes prior to the scheduled start time. In addition, a listen-only broadcast of the call also will be provided over the internet at http://www.newfield.com, under Investor Relations.
Newfield Exploration Company is an independent energy company engaged in exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on North American resource plays and our principal areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. In addition, the Company has oil developments offshore China.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Feb. 25, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) announced the pricing of an underwritten public offering of 30,000,000 shares of its common stock. The underwriters intend to offer the shares from time to time for sale in one or more transactions on the New York Stock Exchange, in the over-the-counter market, through negotiated transactions or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices. The total gross proceeds of the offering (before underwriter's discounts and commissions and estimated offering expenses) will be approximately $700 million. Newfield granted the underwriters a 30-day option to purchase up to 4,500,000 additional shares of its common stock. The offering is expected to close on March 2, 2016.
The net proceeds from the offering will be used for general corporate purposes, which may include repaying outstanding borrowings under Newfield's credit facility and money market lines of credit, funding capital expenditures and working capital.
Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and Goldman, Sachs & Co. are acting as book-running managers for the offering. The offering is being made under an effective shelf registration statement on Form S-3 (Registration No. 333-198120) filed by Newfield with the Securities and Exchange Commission ("SEC") and only by means of a prospectus supplement and accompanying prospectus. Prospective investors should read the preliminary prospectus supplement and the accompanying prospectus included in the registration statement and other documents Newfield has filed with the SEC for more complete information about Newfield and the offering of the common stock. When available, copies of the prospectus supplement and the accompanying base prospectus related to the offering may be obtained for free by visiting EDGAR on the SEC website, www.sec.gov, or by contacting Credit Suisse Securities (USA) LLC, Prospectus Department (1-800-221-1037), One Madison Avenue, New York, New York 10010, email: newyork.prospectus@credit-suisse.com; J.P. Morgan via Broadridge Financial Solutions (866-803-9204), 1155 Long Island Avenue, Edgewood, New York 11717, email: prospectus-eq_fi@jpmchase.com; Goldman, Sachs & Co., attention: Prospectus Department (866-471-2526), 200 West Street, New York, New York 10282, email: prospectus-ny@ny.email.gs.com.
This news release is for informational purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of, or any solicitation of an offer to buy, these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
Newfield Exploration Company is an independent energy company engaged in exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on North American resource plays and our principal areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. In addition, the Company has oil developments offshore China.
**This release contains forward-looking information. All information other than historical facts included in this release is forward-looking information. Although Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors. Factors that could impact forward-looking statements are described in "Risk Factors" in Newfield's 2015 Annual Report on Form 10-K and other subsequent public filings with the Securities and Exchange Commission, which can be found at www.sec.gov. Unpredictable or unknown factors, not discussed in this press release, could also have material adverse effects on forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Feb. 25, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today announced that it has commenced a registered underwritten public offering of 29,000,000 shares of its common stock. The underwriters intend to offer the shares from time to time for sale in one or more transactions on the New York Stock Exchange, in the over-the-counter market, through negotiated transactions or otherwise at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices. Newfield expects to grant the underwriters a 30-day option to purchase up to 4,350,000 additional shares of its common stock. The net proceeds from the offering will be used for general corporate purposes, which may include repaying outstanding borrowings under Newfield's credit facility and money market lines of credit, funding capital expenditures and working capital.
Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC and Goldman, Sachs & Co. are acting as book-running managers for the offering. The offering is being made under an effective shelf registration statement on Form S-3 (Registration No. 333-198120) filed by Newfield with the Securities and Exchange Commission ("SEC") and only by means of a prospectus supplement and accompanying prospectus. A preliminary prospectus supplement has been filed with the SEC to which this communication relates. Prospective investors should read the preliminary prospectus supplement and the accompanying prospectus included in the registration statement and other documents Newfield has filed with the SEC for more complete information about Newfield and the offering of its common stock. When available, copies of the preliminary prospectus supplement, the prospectus supplement and the accompanying base prospectus related to the offering may be obtained for free by visiting EDGAR on the SEC website, www.sec.gov, or by contacting Credit Suisse Securities (USA) LLC, Prospectus Department (1-800-221-1037), One Madison Avenue, New York, New York 10010, email: newyork.prospectus@credit-suisse.com; J.P. Morgan via Broadridge Financial Solutions (866-803-9204), 1155 Long Island Avenue, Edgewood, New York 11717, email: prospectus-eq_fi@jpmchase.com; Goldman, Sachs & Co., attention: Prospectus Department (866-471-2526), 200 West Street, New York, New York 10282, email: prospectus-ny@ny.email.gs.com.
This news release is for informational purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of, or any solicitation of an offer to buy, these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
Newfield Exploration Company is an independent energy company engaged in exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on North American resource plays and our principal areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. In addition, the Company has oil developments offshore China.
**This release contains forward-looking information. All information other than historical facts included in this release is forward-looking information. Although Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors. Factors that could impact forward-looking statements are described in "Risk Factors" in Newfield's 2015 Annual Report on Form 10-K and other subsequent public filings with the Securities and Exchange Commission, which can be found at www.sec.gov. Unpredictable or unknown factors, not discussed in this press release, could also have material adverse effects on forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Feb. 24, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today provided its 2016 capital budget and production expectations. Additional information is provided through the @NFX publication, located on its website at www.newfield.com.
"More than a year ago, we discussed a 'lower for longer' scenario for crude oil prices. Although our hedge position in 2016-17 helps provide improved cash flows, the realities of today's macro-economic environment require us to significantly reduce our investment levels," said Lee K. Boothby, Newfield Chairman, President and CEO. "We have cut our planned investments in 2016 by more than 65% and 50%, respectively, compared to 2014 and 2015 levels. We are moving aggressively to better align our capital expenditures with expected cash flows from operations, while working diligently to further reduce costs and improve margins across the Company. We have premier assets in the Anadarko Basin and plan to maintain an active program as we hold our acreage by production (HBP) and move toward full field development. We have a deep and high-quality inventory of future drilling projects to exploit when oil prices stabilize and margins improve."
The Company has adapted its near-term business plan to include four key priorities:
Newfield's 2016 capital budget is expected to be $625 – $675 million (excluding about $100 million in capitalized interest and direct internal costs), down about 50% over 2015 investment levels of approximately $1.4 billion, excluding capitalized internal costs.
Newfield's domestic production in 2016 is expected to be approximately 50 MMBOE. China production for 2016 is estimated at approximately 4.3 MMBOE. A table is included in this release detailing the expected composition of production and costs and expenses for 2016.
2016 Investment Highlights:
2016e Production, Cost and Expense Guidance
Domestic |
China |
Total |
||||
Production: |
||||||
Oil (Mmbls) |
19.5 – 20.5 |
4.3 |
23.8 – 24.8 |
|||
NGLs (Mmbls) |
8.8 – 9.2 |
– |
8.8 – 9.2 |
|||
Natural gas (Bcf) |
125 – 129 |
– |
125 – 129 |
|||
Total (Mmboe) |
49.0 – 51.0 |
4.3 |
53.3 – 55.3 |
|||
Expenses ($ mm)1 |
||||||
LOE2 |
$205 |
$53 |
$258 |
|||
Transportation3 |
250 |
– |
250 |
|||
Production & other taxes |
40 |
1 |
41 |
|||
General & administrative (G&A), net |
$165 |
$7 |
$172 |
|||
Interest expense |
156 |
– |
156 |
|||
Capitalized interest and direct internal costs |
($103) |
– |
($103) |
|||
Tax rate |
37% |
60%4 |
39% |
|||
Note: Based on strip commodity prices in 2016 | ||||||
1Cost and expenses are expected to be within 5% of the estimates above | ||||||
2Total LOE includes recurring, major expense and non E&P operating expenses | ||||||
3Estimated transportation / processing fees include ~$52MM Arkoma unused firm gas transportation and ~$21MM Uinta oil and gas delivery shortfall fees | ||||||
4Estimated China tax rate reflects a 25% taxation in-country, as well as an additional non-cash U.S. income tax of 35% |
1Q16e Production, Cost and Expense Guidance
Domestic |
China |
Total |
||||
Production: |
||||||
Oil (Mmbls) |
5.0 – 5.2 |
1.7 |
6.7 – 6.9 |
|||
NGLs (Mmbls) |
2.3 – 2.5 |
– |
2.3 – 2.5 |
|||
Natural gas (Bcf) |
33 |
– |
33 |
|||
Total (Mmboe) |
12.8 – 13.2 |
1.7 |
14.5 – 14.9 |
|||
Expenses ($ mm)1 |
||||||
LOE2 |
$51 |
$16 |
$67 |
|||
Transportation3 |
61 |
– |
61 |
|||
Production & other taxes |
9 |
– |
9 |
|||
General & administrative (G&A), net |
$42 |
2 |
$44 |
|||
Interest expense |
39 |
– |
39 |
|||
Capitalized interest and direct internal costs |
($27) |
– |
($27) |
|||
Tax rate |
37% |
60%4 |
39% |
|||
Note: Based on strip commodity prices in 2016 | ||||||
1Cost and expenses are expected to be within 5% of the estimates above | ||||||
2Total LOE includes recurring, major expense and non E&P operating expenses | ||||||
3Estimated transportation / processing fees include ~$13MM Arkoma unused firm gas transportation and ~$3MM Uinta oil and gas delivery shortfall fees | ||||||
4Estimated China tax rate reflects a 25% taxation in-country, as well as an additional non-cash U.S. income tax of 35% |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on U.S. resource plays of scale. Our principal domestic areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. Newfield also has offshore oil developments in China.
**This release contains forward-looking information. All information other than historical facts included in this release, such as information regarding estimated or anticipated drilling plans, planned capital expenditures, and estimated production, is forward-looking information. Although Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including oil and gas prices, environmental liabilities not covered by indemnity or insurance, legislation or regulatory initiatives intended to address seismic activity, industry conditions, the prices of goods and services, the availability of drilling rigs and other support services, the availability and cost of capital resources, new regulations or changes in tax legislation, labor conditions and severe weather conditions. In addition, the drilling of oil and natural gas wells and the production of hydrocarbons are subject to numerous governmental regulations and operating risks. Other factors that could impact forward-looking statements are described in "Risk Factors" in Newfield's Annual Report on Form 10-K and other subsequent public filings with the Securities and Exchange Commission, which can be found at www.sec.gov. Unpredictable or unknown factors, not discussed in this press release, could also have material adverse effects on forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
SOURCE Newfield Exploration Company
THE WOODLANDS, Texas, Feb. 24, 2016 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today reported its fourth quarter 2015 financial results, as well as 2015 year-end proved reserves. Additional operational details can be found in the Company's @NFX publication, located on its website. Newfield today issued a separate news release outlining its planned 2016 capital investment program and full-year production expectations.
Newfield will host a conference call at 10 a.m. CST, February 25, 2016. To listen to the call, please visit Newfield's website at http://www.newfield.com. To participate in the call, dial 785-424-1666 and enter conference code 1019964 about 10 minutes prior to the scheduled start time.
Fourth Quarter and Full-Year 2015 Financial Summary
For the fourth quarter, the Company recorded a net loss of $663 million, or $4.06 per diluted share (all per share amounts are on a diluted basis). The loss was primarily related to a full-cost ceiling test impairment of $702 million ($651 million after-tax, or $3.95 per share). After adjusting for the effect of impairments and unrealized derivative losses, net income would have been $50 million, or $0.30 per share.
Revenues for the fourth quarter were $362 million. Net cash provided by operating activities before changes in operating assets and liabilities was $289 million.
For the full-year 2015, Newfield posted a net loss of $3.4 billion, or $21.18 per share. Excluding impairments, unrealized losses on commodity derivatives and the premium to call notes, net income would have been $164 million, or $1.02 per share. Revenues for 2015 were approximately $1.6 billion and consolidated net cash provided by operating activities before changes in operating assets and liabilities was approximately $1.2 billion.
Fourth Quarter and Full-Year 2015 Production Summary
Newfield's total net production in the fourth quarter of 2015 was 14.9 MMBOE, comprised of 47% oil, 16% natural gas liquids and 37% natural gas. Domestic production in the fourth quarter was 13.5 MMBOE.
For the full-year 2015, Newfield's production was 56 MMBOE, of which 5.4 MMBOE was from offshore China.
Proved Reserves and Costs Incurred
Newfield's year-end 2015 proved reserves were 509 MMBOE (98% domestic). Approximately 57% of proved reserves are liquids and 65% are proved developed. The largest source of reserve additions during 2015 came from the Anadarko Basin, which now total 269 MMBOE and comprise more than half of Newfield's total proved reserves. The proved reserve life index for the Company is approximately nine years.
Proved reserves were down year-over-year and were impacted by significantly lower crude oil and natural gas prices used in year-end reserve calculations. Crude oil and natural gas prices used in this calculation were $50.11 per barrel (down 47%) and $2.59 per MMbtu (down 40%), respectively. As a result, pre-tax present value of reserves (discounted at 10%) at year-end 2015 was approximately $2.9 billion, down 67% over the prior year-end.
Net negative revisions to previous estimates were 174 MMBOE. Revisions included price-related negative revisions of approximately 286 MMBOE, which were offset by positive performance and cost revisions of 112 MMBOE. Proved reserve extensions, discoveries and other additions of 101 MMBOE during the year equate to a reserve replacement ratio of approximately 180%.
Newfield engaged the consulting firms DeGolyer and MacNaughton and Ryder Scott Company to perform an audit of the internally prepared reserve estimates on certain fields covering 94% of year-end 2015 proved reserve quantities on a barrel of oil equivalent basis. The purpose of this audit was to provide additional assurance on the reasonableness of internally prepared reserve estimates. Newfield's proved reserves are, in aggregate, reasonable and within the established audit tolerance guidelines of 10 percent.
Newfield invested approximately $1.5 billion in 2015, which includes approximately $304 million in land and leasehold expenditures and $107 million of capitalized interest and internal costs. The tables below provide additional information on reserves and costs incurred during 2015.
Crude Oil and Condensate (MMBbls) |
Natural Gas (Bcf) |
Natural Gas Liquids (MMBbls) |
Total (MMBOE) | ||||
Total Company Reserves |
|||||||
December 31, 2014 |
301 |
1,607 |
76 |
645 | |||
Revisions of previous estimates |
(112) |
(352) |
(3) |
(174) | |||
Extensions, discoveries and other additions |
49 |
187 |
20 |
101 | |||
Purchases of properties |
1 |
2 |
— |
1 | |||
Sales of properties |
(5) |
(15) |
— |
(8) | |||
Production |
(27) |
(124) |
(9) |
(56) | |||
December 31, 2015 |
207 |
1,305 |
84 |
509 |
SEC pricing used for year-end 2015 reserve calculations: $2.59 per MMBtu for natural gas and $50.11 per barrel for oil, adjusted for market differentials.
The following table presents costs incurred for oil and gas property acquisition, exploration and development for 2015:
Domestic |
China |
Total | |||||
(in millions) |
|||||||
Property acquisitions: |
|||||||
Unproved |
$ 283 |
$ 1 |
$ 284 | ||||
Proved |
21 |
--- |
21 | ||||
Exploration |
578 |
--- |
578 | ||||
Development(1) |
630 |
15 |
645 | ||||
Total costs incurred(2) |
$ 1,512 |
$ 16 |
$ 1,528 | ||||
(1) |
Includes $4 million of asset retirement costs. |
(2) |
Total costs incurred includes approximately $107 million of capitalized interest and internal costs |
Newfield Exploration Company is an independent energy company engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. We are focused on U.S. resource plays and our principal areas of operation include the Mid-Continent, the Rocky Mountains and onshore Texas. We also have offshore oil developments in China.
**This release contains forward-looking information. All information other than historical facts included in this release, such as information regarding estimated or anticipated drilling plans, planned capital expenditures, and estimated production, is forward-looking information. Although Newfield believes that these expectations are reasonable, this information is based upon assumptions and anticipated results that are subject to numerous uncertainties and risks. Actual results may vary significantly from those anticipated due to many factors, including oil and gas prices, environmental liabilities not covered by indemnity or insurance, legislation or regulatory initiatives intended to address seismic activity, industry conditions, the prices of goods and services, the availability of drilling rigs and other support services, the availability and cost of capital resources, new regulations or changes in tax legislation, labor conditions and severe weather conditions. In addition, the drilling of oil and natural gas wells and the production of hydrocarbons are subject to numerous governmental regulations and operating risks. Other factors that could impact forward-looking statements are described in "Risk Factors" in Newfield's Annual Report on Form 10-K and other subsequent public filings with the Securities and Exchange Commission, which can be found at www.sec.gov. Unpredictable or unknown factors, not discussed in this press release, could also have material adverse effects on forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Unless legally required, Newfield undertakes no obligation to publicly update or revise any forward-looking statements.
For additional information, please contact Newfield's Investor Relations department.
Phone: 281-210-5321
Email: info@newfield.com
4Q15 Actual | ||||||||||||||||||
4Q15 Actual Results |
Domestic |
China |
Total | |||||||||||||||
Production/Liftings1 |
||||||||||||||||||
Crude oil and condensate (MMBbls) |
5.6 |
1.4 |
7.0 | |||||||||||||||
Natural gas (Bcf) |
32.6 |
— |
32.6 | |||||||||||||||
NGLs (MMBbls) |
2.4 |
— |
2.4 | |||||||||||||||
Total (MMBOE) |
13.5 |
1.4 |
14.9 | |||||||||||||||
Average Realized Prices2, 3 |
||||||||||||||||||
Crude oil and condensate (per Bbl) |
$ |
50.88 |
$ |
39.25 |
$ |
48.53 | ||||||||||||
Natural gas (per Mcf) |
3.41 |
— |
3.41 | |||||||||||||||
NGLs (per Bbl) |
18.12 |
— |
18.12 | |||||||||||||||
Crude oil equivalent (per BOE) |
$ |
33.00 |
$ |
39.25 |
$ |
33.61 | ||||||||||||
Operating Expenses:3 |
||||||||||||||||||
Lease operating (in millions) |
||||||||||||||||||
Recurring |
$ |
47.9 |
$ |
13.4 |
$ |
61.3 | ||||||||||||
Major (workovers, etc.) |
$ |
4.8 |
$ |
0.3 |
$ |
5.1 | ||||||||||||
Lease operating (per BOE) |
||||||||||||||||||
Recurring |
$ |
3.64 |
$ |
9.52 |
$ |
4.21 | ||||||||||||
Major (workovers, etc.) |
$ |
0.37 |
$ |
0.28 |
$ |
0.36 | ||||||||||||
Transportation and processing (in millions) |
$ |
58.5 |
$ |
— |
$ |
58.5 | ||||||||||||
per BOE |
$ |
4.42 |
$ |
— |
$ |
3.99 | ||||||||||||
Production and other taxes (in millions) |
$ |
2.5 |
$ |
0.3 |
$ |
2.8 | ||||||||||||
per BOE |
$ |
0.19 |
$ |
0.16 |
$ |
0.19 | ||||||||||||
General and administrative (G&A), net (in millions) |
$ |
62.5 |
$ |
1.6 |
$ |
64.1 | ||||||||||||
per BOE |
$ |
4.75 |
$ |
1.13 |
$ |
4.39 | ||||||||||||
Capitalized direct internal costs (in millions) |
$ |
(17.3) | ||||||||||||||||
per BOE |
$ |
(1.19) | ||||||||||||||||
Other operating expenses, net (in millions) |
$ |
2.9 | ||||||||||||||||
per BOE |
$ |
0.20 | ||||||||||||||||
Interest expense (in millions) |
$ |
37.3 | ||||||||||||||||
per BOE |
$ |
2.56 | ||||||||||||||||
Capitalized interest (in millions) |
$ |
(9.5) | ||||||||||||||||
per BOE |
$ |
(0.65) | ||||||||||||||||
Other non-operating (income) expense (in millions) |
$ |
0.5 | ||||||||||||||||
per BOE |
$ |
0.02 |
____ Note 1: Represents volumes lifted and sold regardless of when produced. Includes natural gas produced and consumed in operations of 1.7 Bcf during the three months ended December 31, 2015.
| ||||||||||||||||||
Note 2: Average realized prices include the effects of derivative contracts. Excluding these effects, the average realized price for domestic and total natural gas would have been $2.07 per Mcf and the average realized price for our domestic and total crude oil and condensate would have been $35.17 per barrel and $35.99 per barrel, respectively. We did not have any derivative contracts associated with our NGL or China production as of December 31, 2015.
Note 3: All per unit pricing and expenses exclude natural gas produced and consumed in operations. | ||||||||||||||||||
CONSOLIDATED STATEMENT OF OPERATIONS |
||||||||||||||
(Unaudited, in millions, except per share data) |
||||||||||||||
Three Months Ended December 31, |
Twelve Months Ended December 31, | |||||||||||||
2015 |
2014 |
2015 |
2014 | |||||||||||
Oil, gas and NGL revenues |
$ |
362 |
$ |
495 |
$ |
1,557 |
$ |
2,288 | ||||||
Operating expenses: |
||||||||||||||
Lease operating |
66 |
83 |
285 |
311 | ||||||||||
Transportation and processing |
59 |
49 |
212 |
174 | ||||||||||
Production and other taxes |
3 |
21 |
46 |
111 | ||||||||||
Depreciation, depletion and amortization |
196 |
237 |
917 |
870 | ||||||||||
General and administrative |
64 |
50 |
244 |
222 | ||||||||||
Ceiling test and other impairments |
702 |
— |
4,904 |
— | ||||||||||
Other |
2 |
10 |
10 |
25 | ||||||||||
Total operating expenses |
1,092 |
450 |
6,618 |
1,713 | ||||||||||
Income (loss) from operations |
(730) |
45 |
(5,061) |
575 | ||||||||||
Other income (expense): |
||||||||||||||
Interest expense |
(37) |
(47) |
(164) |
(200) | ||||||||||
Capitalized interest |
10 |
14 |
33 |
53 | ||||||||||
Commodity derivative income (expense) |
29 |
577 |
259 |
610 | ||||||||||
Other, net |
(1) |
(10) |
(14) |
(6) | ||||||||||
Total other income (expense) |
1 |
534 |
114 |
457 | ||||||||||
Income (loss) from continuing operations before income taxes |
(729) |
579 |
(4,947) |
1,032 | ||||||||||
Income tax provision (benefit) |
(66) |
212 |
(1,585) |
382 | ||||||||||
Income (loss) from continuing operations |
(663) |
367 |
(3,362) |
650 | ||||||||||
Income (loss) from discontinued operations, net of tax |
— |
(7) |
— |
250 | ||||||||||
Net income (loss) |
$ |
(663) |
$ |
360 |
$ |
(3,362) |
$ |
900 | ||||||
Earnings (loss) per share: |
||||||||||||||
Basic: |
||||||||||||||
Income (loss) from continuing operations |
$ |
(4.06) |
$ |
2.67 |
$ |
(21.18) |
$ |
4.76 | ||||||
Income (loss) from discontinued operations |
— |
(0.05) |
— |
1.83 | ||||||||||
Basic earnings (loss) per share |
$ |
(4.06) |
$ |
2.62 |
$ |
(21.18) |
$ |
6.59 | ||||||
Diluted: |
||||||||||||||
Income (loss) from continuing operations |
$ |
(4.06) |
$ |
2.65 |
$ |
(21.18) |
$ |
4.71 | ||||||
Income (loss) from discontinued operations |
— |
(0.05) |
— |
1.81 | ||||||||||
Diluted earnings (loss) per share |
$ |
(4.06) |
$ |
2.60 |
$ |
(21.18) |
$ |
6.52 | ||||||
Weighted-average number of shares outstanding for basic earnings (loss) per share |
163 |
137 |
159 |
137 | ||||||||||
Weighted-average number of shares outstanding for diluted earnings (loss) per share |
163 |
138 |
159 |
138 | ||||||||||
CONDENSED CONSOLIDATED BALANCE SHEET |
||||||
(Unaudited, in millions) |
||||||
December 31, |
December 31, | |||||
2015 |
2014 | |||||
ASSETS |
||||||
Current assets: |
||||||
Cash and cash equivalents |
$ |
5 |
$ |
14 | ||
Derivative assets |
284 |
431 | ||||
Other current assets |
336 |
495 | ||||
Total current assets |
625 |
940 | ||||
Oil and gas properties, net (full cost method) |
3,819 |
8,232 | ||||
Derivative assets |
105 |
190 | ||||
Other assets |
219 |
218 | ||||
Total assets |
$ |
4,768 |
$ |
9,580 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY |
||||||
Current liabilities: |
||||||
Derivative liabilities |
$ |
13 |
$ |
8 | ||
Other current liabilities |
634 |
1,093 | ||||
Total current liabilities |
647 |
1,101 | ||||
Other liabilities |
48 |
45 | ||||
Derivative liabilities |
9 |
— | ||||
Long-term debt |
2,467 |
2,874 | ||||
Asset retirement obligations |
192 |
183 | ||||
Deferred taxes |
26 |
1,484 | ||||
Total long-term liabilities |
2,742 |
4,586 | ||||
Stockholders' equity: |
||||||
Common stock, treasury stock and additional paid-in capital |
2,416 |
1,567 | ||||
Accumulated other comprehensive gain (loss) |
(2) |
(1) | ||||
Retained earnings (deficit) |
(1,035) |
2,327 | ||||
Total stockholders' equity |
1,379 |
3,893 | ||||
Total liabilities and stockholders' equity |
$ |
4,768 |
$ |
9,580 | ||
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS |
|||||||||
Year Ended December 31, | |||||||||
2015 |
2014 | ||||||||
Cash flows from operating activities: |
|||||||||
Net income (loss) |
$ |
(3,362) |
$ |
900 | |||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|||||||||
Depreciation, depletion and amortization |
917 |
903 | |||||||
Deferred tax provision (benefit) |
(1,602) |
509 | |||||||
Stock-based compensation |
25 |
28 | |||||||
Unrealized (gain) loss on derivative contracts |
246 |
(649) | |||||||
Gain on sale of Malaysia business |
— |
(373) | |||||||
Ceiling test and other impairments |
4,904 |
— | |||||||
Other, net |
43 |
21 | |||||||
1,171 |
1,339 | ||||||||
Changes in operating assets and liabilities |
38 |
48 | |||||||
Net cash provided by (used in) operating activities |
1,209 |
1,387 | |||||||
Cash flows from investing activities: |
|||||||||
Additions and acquisitions of oil and gas properties and other |
(1,745) |
(2,128) | |||||||
Proceeds from sales of oil and gas properties |
90 |
620 | |||||||
Proceeds received from sale of Malaysia business, net |
— |
809 | |||||||
Redemptions of investments |
— |
39 | |||||||
Proceeds from insurance settlement, net |
57 |
— | |||||||
Net cash provided by (used in) investing activities |
(1,598) |
(660) | |||||||
Cash flows from financing activities: |
|||||||||
Net proceeds (repayments) of borrowings under credit arrangements |
(407) |
(203) | |||||||
Proceeds from issuance of senior notes |
691 |
— | |||||||
Repayment of senior subordinated notes |
(700) |
(600) | |||||||
Proceeds from issuances of common stock, net |
819 |
6 | |||||||
Other, net |
(23) |
(11) | |||||||
Net cash provided by (used in) financing activities |
380 |
(808) | |||||||
Increase (decrease) in cash and cash equivalents |
(9) |
(81) | |||||||
Cash and cash equivalents, beginning of period |
14 |
95 | |||||||
Cash and cash equivalents, end of period |
$ |
5 |
$ |
14 | |||||
Explanation and Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Earnings Stated Without the Effect of Certain Items)
Earnings stated without the effect of certain items is a non-GAAP financial measure. Earnings without the effect of these items are presented because they affect the comparability of operating results from period to period. In addition, earnings without the effect of these items are more comparable to earnings estimates provided by securities analysts. This measure should not be considered an alternative to net income (loss) as defined by generally accepted accounting principles.
A reconciliation of earnings for the fourth quarter and full year of 2015 for our continuing operations stated without the effect of certain items to net income (loss) is shown below:
4Q15 |
2015 | ||||||||||||
(in millions) | |||||||||||||
Net Income (loss) |
$ |
(663) |
$ |
(3,362) | |||||||||
Ceiling test and other impairments |
702 |
4,904 | |||||||||||
Unrealized (gain) loss on derivative contracts(1) |
101 |
246 | |||||||||||
Restructuring related costs |
2 |
39 | |||||||||||
Production tax credits |
(7) |
(7) | |||||||||||
Premium on debt redemption |
— |
24 | |||||||||||
Unamortized debt issuance costs and discount from redemption |
— |
8 | |||||||||||
Income tax adjustment for above items |
(85) |
(1,688) | |||||||||||
Earnings stated without the effect of the above items |
$ |
50 |
$ |
164 |
(1) The calculation of "Unrealized (gain) loss on derivative contracts" for the fourth quarter and full year of 2015 is as follows: | |||||||||||||
4Q15 |
2015 | ||||||||||
(in millions) | |||||||||||
Commodity derivative income (expense) |
$ |
29 |
$ |
259 | |||||||
Less: Realized gain (loss) on derivative contracts |
130 |
505 | |||||||||
Unrealized loss on derivative contracts |
$ |
(101) |
$ |
(246) | |||||||
Net Cash Provided by Operating Activities Before Changes in Operating Assets and Liabilities
Net cash provided by operating activities before changes in operating assets and liabilities is presented because of its acceptance as an indicator of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur additional debt. This measure should not be considered an alternative to net cash provided by operating activities as defined by generally accepted accounting principles.
A reconciliation of net cash provided by operating activities to net cash provided by operating activities before changes in operating assets and liabilities is shown below:
4Q15 |
2015 | ||||||||||
(in millions) | |||||||||||
Net cash provided by operating activities |
$ |
320 |
$ |
1,209 | |||||||
Net changes in operating assets and liabilities |
(31) |
(38) | |||||||||
Net cash provided by operating activities before changes |
|||||||||||
in operating assets and liabilities |
$ |
289 |
$ |
1,171 | |||||||
SOURCE Newfield Exploration Company
Barton Water Recycle Facility (subscriber access)
Status: (subscriber access)
Parent Entities:
Newfield Exploration Co.
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