California Resources Corporation Highlights 2015 Activity and Updates Deleveraging Activities
California Resources Corporation (NYSE: CRC) today announced that it
expects total average production for the full year 2015 to increase
approximately one percent to an average of approximately 160 thousand
barrels of oil equivalent per day and crude oil to increase by
approximately five percent to 104 thousand barrels per day. Cash costs,
excluding interest charges, are expected to fall by 11% from 2014 levels
and 2015 capital investments are expected to total approximately $400
million, enabling CRC to drill and complete 311 wells and invest about
$160 million in its infrastructure and facilities.
CRC is actively working on a 2016 budget that will reflect our primary
investment tenet of investing within cash flow from operations.
Reflecting this principle and the recent further deterioration in oil
prices, CRC is releasing both of its contracted drilling rigs in the San
Joaquin basin moving into 2016. A rig will be maintained in the Los
Angeles basin on an intermittent basis. Despite the drilling rig
releases, the company currently intends to maintain a workover fleet of
30 rigs.
CRC continues to focus on its longer term debt reduction target. This
month, CRC closed a bond exchange which reduces the principal on its
outstanding debt by $563 million while increasing interest by just $21
million per year. CRC has been pursuing multiple transactions to achieve
further deleveraging. Detailed discussions on specific transactions
progressed throughout the fourth quarter. However, in light of the
recent further drop in commodity prices, we do not expect to announce
any further deleveraging transactions in 2015.
Commenting on CRC’s 2015 highlights, Todd Stevens, President and CEO,
said, “We are extremely proud of our team’s accomplishments during our
first year as a stand-alone company. In a challenging commodity
environment, we increased our production despite spending below the
level of investment we expected would be required to maintain
production. This production increase is a testament to our employees’
effective management of our low-decline asset base. The attributes of
our world class assets provide us with increased flexibility to
withstand a prolonged downturn in commodity prices.
“We meaningfully reduced our debt levels during the quarter through our
successful debt exchange and have significantly progressed on other
potential deleveraging transactions. Although the recent deterioration
in commodity prices is likely to delay the execution of additional
deleveraging transactions, we are working diligently to further reduce
our debt levels as soon as possible in the new year. We are committed to
acting in the best interests of our shareholders over the long term and
will not pursue a transaction in the current environment simply to meet
our stated objective of signing up a deal by year end.
“Looking forward, we are building a dynamic capital budget for 2016
designed to allow us to adjust our investment levels based on commodity
prices, and our high level of operational control allows us to make
capital allocation decisions quickly. We are committed to living within
our means and will be prepared to invest exclusively for mechanical
integrity and safety projects if necessary or to increase overall
activity as prices recover.”
About California Resources Corporation
California Resources Corporation is the largest oil and natural gas
exploration and production company in California on a gross-operated
basis. The Company operates its world class resource base exclusively
within the State of California, applying integrated infrastructure to
gather, process and market its production. Using advanced technology,
California Resources Corporation focuses on safely and responsibly
supplying affordable energy for California by Californians.
View source version on businesswire.com: http://www.businesswire.com/news/home/20151215006700/en/
Copyright Business Wire 2015
Source: Business Wire
(December 15, 2015 - 4:01 PM EST)
News by QuoteMedia
www.quotemedia.com