Concho Resources Inc. (CXO) (the “Company” or “Concho”) today announced an updated 2015 capital program of $2.0 billion, as a result of the sharp decline in commodity prices. With this level of activity, the Company expects to generate 16% to 20% year-over-year production growth in 2015.
Tim Leach, Chairman, Chief Executive Officer and President, commented, “Reducing the capital program while delivering robust growth reflects our commitment to a strong balance sheet and highlights the quality of our assets in the Permian Basin. In the current environment, we intend to prudently manage our 2015 capital program around anticipated cash flows and retain significant flexibility to scale our activity level up or down depending on service costs and commodity prices.”
2015 Capital Program and Guidance Update
The 2015 capital program includes approximately $1.8 billion for drilling and completion activities and approximately $200 million for facilities, midstream and other capital. The Company plans to allocate approximately $1.3 billion for drilling and completions in the Delaware Basin, approximately $300 million in the Texas Permian and approximately $200 million in the New Mexico Shelf. Concho is currently running 36 drilling rigs and expects to average approximately 30 rigs in the first quarter of 2015 and approximately 25 rigs beginning in the second quarter of 2015 through year end. The 2015 capital program excludes acquisitions and is subject to change depending upon a number of factors, including economic and industry conditions.
The Company also updated its full-year 2015 guidance for certain financial items. Natural gas price realizations are expected to average 100% to 120% of NYMEX Henry Hub. Current income taxes are expected to be $40 million to $50 million.
Additionally, the Company’s January 2015 Investor Presentation is now available on the Investor Relations section of the Company’s website.
About Concho Resources Inc.
Concho Resources Inc. is an independent oil and natural gas company engaged in the acquisition, development and exploration of oil and natural gas properties. The Company’s operations are primarily focused in the Permian Basin of Southeast New Mexico and West Texas. For more information, visit the Company’s website at www.concho.com.