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Enron Mail |
Cc: keith.macivor@enron.com, brian.redmond@enron.com, julie.gomez@enron.com,
john.lavorato@enron.com, vince.kaminski@enron.com, claudio.ribeiro@enron.com, paulo.issler@enron.com, w.byargeon@enron.com, gary.bryan@enron.com Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit Bcc: keith.macivor@enron.com, brian.redmond@enron.com, julie.gomez@enron.com, john.lavorato@enron.com, vince.kaminski@enron.com, claudio.ribeiro@enron.com, paulo.issler@enron.com, w.byargeon@enron.com, gary.bryan@enron.com X-From: John Peyton X-To: Jean Mrha X-cc: Keith MacIvor, Brian Redmond, Julie A Gomez, John J Lavorato, Vince J Kaminski, Claudio Ribeiro, Paulo Issler, W Tom Byargeon, Gary Bryan X-bcc: X-Folder: \Vincent_Kaminski_Jun2001_1\Notes Folders\All documents X-Origin: Kaminski-V X-FileName: vkamins.nsf SURVEY FINDS PRODUCERS PLAN TO SPEND MORE THAN ORIGINALLY PLANNED IN 2000 06/19/2000 Petroleum Finance Week © 2000 Phillips Business Information, Inc. Oil and gas producers plan to increase their worldwide exploration and production expenditures by more than they anticipated at the beginning of the year, Lehman Brothers Inc. found in a mid-year update of its annual E&P survey. "The 326 companies we surveyed are planning on an 18.2 percent increase, versus a 10.2 percent rise budgeted in December," said James D. Crandell, who follows oil services and drilling for the New York investment banker. He emphasized that the gain by the 326 producers in Lehman's survey reflects increases in budgets for 2000 and not underspending of budgets during 1999. "Among the companies that were included in our December 1999 and May 2000 surveys, global spending actually came in slightly above what was estimated to have been spent during 1999 in December. It also indicates that nearly $6 billion has been added to 2000 worldwide exploration budgets since December," Crandell said. The survey's respondents said that they planned to increase U.S. E&P expenditures by 17.6 percent, up from 15.9 percent earlier in the year. Crandell said that the greater increase was driven almost entirely by independent producers. "In our survey, 227 independents indicated E&P spending growth in 2000 of 26.1 percent versus a 22.9 percent increase budgeted for the year in December," he indicated. "Some 40 percent of the independents we surveyed have increased their U.S. E&P budgets, while about 23 percent plan on spending less than what they indicated last December. Higher natural gas prices and increased cash flow are the main drivers behind this." Crandell said that Anadarko Petroleum Corp. (NYSE: APC), Apache Corp. (NYSE: APA), BHP Petroleum, H.S. Resources Inc. (NYSE: HSE), McMoRan Exploration Co. (NYSE: RAN), MDU Resources Group Inc. (NYSE: MDU), Mitchell Energy and Development Corp. (NYSE: MND.A and MND.B), Santa Fe Snyder Corp. (NYSE: SFS), Stone Energy Corp. (NYSE: SGY) and Titan Exploration Inc. - now Pure Resources Inc. (NYSE: PRS) - were among the larger independents to make the most significant upward revisions. The ones that significantly reduced planned U.S. E&P outlays for the year included Barrett Resources Corp. (NYSE: BRR), Belco Oil and Gas Corp. (NYSE: BOG), Burlington Resources Inc. (NYSE: BR), Coastal Corp. (NYSE: CGP), Forcenergy Inc. (NYSE: FEN), Houston Exploration Co. (NYSE: HEX), Kerr-McGee Corp. (NYSE: KMG), Mariner Energy Corp. and Williams Production Co. The survey found that major oil companies plan about the same percentage gain in their 2000 U.S. E&P expenditures (8.8 percent) at midyear as they did at the beginning of the year (8.4 percent). Among the 14 companies in this category, 31 percent made meaningful increases in their 2000 E&P spending estimates during the first six months, including Amerada Hess Corp. (NYSE: AHC), Conoco Inc. (NYSE: COC.A and COC.B), Occidental Petroleum Corp. (NYSE: OXY)and Total Fina Elf S.A. (NYSE: TOT). Another 19 percent - including ENI SpA (NYSE: E), Royal Dutch/Shell (NYSE: RDP and STT) and Texaco Inc. (NYSE: TX) - scaled back their domestic spending estimates, while the remaining 50 percent of the majors in the survey remained the same. 'The increase in Canada... is nothing short of staggering...' "The increase in Canada indicated by the 85 companies in our survey is nothing short of staggering," Crandell continued. Of the 85 companies that he contacted, 44.7 percent budgeted higher expenditures for 2000 than for 1999. "Compared with December, 41 percent of them have increased their estimated spending in 2000 by more than 10 percent, while 20 percent have reduced it by more than 10 percent. The remaining 39 percent have kept it within 10 percent of what was originally estimated," Crandell said. Talisman Energy Inc. (NYSE: TLM) led the group with a huge increase, followed by Anderson Exploration Ltd. (TSE: AXL), Gulf Canada Resources Ltd. (NYSE: GOU), Murphy Oil Corp. (NYSE: MUR), Pan Canadian Petroleum Ltd. (TSE: PCP) and Shell Canada Ltd. (TSE: SHC). Like their U.S. counterparts, producers above the border raised their 2000 E&P budgets in response to higher gas prices and increased cash flow, according to the Lehman analyst. He said that foreign upstream budgets were an area of surprise: "The 14.9 percent gain indicated by the 99 oil and gas companies that have operations outside the United States and Canada was well above the 5.7 percent increase for 2000 estimated last December. As in other geographies, there were more companies that increased budgets than decreased them." Overall, Crandell said that 33 percent of the surveyed companies raised their 2000 E&P budgets by more than 10 percent, 43 estimated expenditures in roughly the same range and 24 percent indicated that they would spend less than originally planned. He said that the larger increases were driven by some big companies which materially increased their budgets, including Texaco, Petroleos Brasileiros S.A., Petroleos Mexicanos S.A. and Repsol YPF S.A. (NYSE: REP) among the multinationals and Amerada Hess, Apache, Premier Oil Plc. and Woodside Energy among mid-sized companies. Crandell noted that while respondents' average price assumptions rose during 2000's first six months (to $22.04 from $19.25 per barrel of crude oil and to $2.58 from $2.38 per thousand cubic feet of natural gas), they still trail current prices and what Lehman Brothers estimates for the year ($28 per barrel of crude and $3.30 per Mcf of gas). "This suggests a stronger second half than expected, should companies raise budgets further to reflect the higher prices," he said. - Nick Snow in Washington ---------------------- Forwarded by John Peyton/HOU/ECT on 06/19/2000 07:36 PM --------------------------- djcustomclips@djinteractive.com on 06/19/2000 08:27:26 PM Please respond to nobody@mail1.djnr.com To: 1346@WCTOPICS.djnr.com cc: Subject: Energy: Oil Drilling: SURVEY FINDS PRODUCERS PLAN TO SPEND MORE THAN ORIGINALLY PLANNED IN ... SURVEY FINDS PRODUCERS PLAN TO SPEND MORE THAN ORIGINALLY PLANNED IN 2000 Oil and gas producers plan to increase their worldwide exploration and production expenditures by more than they anticipated at the beginning of the year, Lehman Brothers Inc. found in a mid-year update of its annual E&P survey. "The 326 companies we ... Published by: Petroleum Finance Week Date: 06/19/2000 Word Count: 894 Relevance Score on Scale of 100: 80 Folder Name: Energy: Oil Drilling Full-text article available at http://nrstg1p.djnr.com/cgi-bin/NewsRetrieval?cgi=WEB_ST_WC_STORY&DBNAME=ENERG Y&HDAN=PTRY0017100008&Search=Energy%3A%20Oil%20%3A0000001346&QID=1346&QT=S&HDS C=PTRY Articles are included at no charge for flat-fee corporate customers. (Under standard pricing, charges apply. For details, click the $ icon on the Dow Jones Interactive home page, located at http://www.djinteractive.com.) ______________________________________________________________________ To review or revise your folder, visit http://www.djinteractive.com or contact Dow Jones Customer Service by e-mail at custom.news@bis.dowjones.com or by phone at 800-369-7466. 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