Factbox: Global oil, gas producers slash spending after crude price rout
(Reuters) – Oil and gas companies around the world aim to slash spending as crude prices have plunged due to the impact of the coronavirus and a push by Saudi Arabia and Russia to ramp up output. [O/R]
Oil prices LCOc1 have more than halved in value since the start of the year, tumbling below $30 a barrel.
North American oil and gas producers have cut capital spending by about 30% on average, according to data compiled by Reuters.
Below are plans announced by international energy companies (in alphabetical order):
BPBP Plc (BP.L) said it planned to reduce capital and operational spending, which was about $15 billion last year.
Chevron Corp (CVX.N) said it aimed to trim spending and lower oil output in the near term. The oil major’s 2020 organic capital expenditure guidance had been $20 billion.
Norway’s DNO (DNO.OL), which operates in Iraq’s Kurdistan region, said it would cut its 2020 budget by 30% or $300 million and cut its dividend for the first half of the year.
Eni (ENI.MI) followed rivals by cancelling a share buyback and sharply cutting investments. It said it would be withdrawing plans it had to buy back 400 million euros of shares this year, adding it would reconsider a buyback when Brent was at least $60 per barrel.
Equinor (EQNR.OL) is reviewing its capital and exploration spending plans.
It said the second tranche of its share buyback program is pending approval by the annual shareholders’ meeting. It was worth $675 million when including the Norwegian state’s share and was due to run from May 18 to Oct. 28.
Exxon Mobil Corp (XOM.N) said it would make “significant” cuts to spending. It had previously budgeted $30 billion to $33 billion for projects in 2020.
London-listed Genel Energy Plc (GENL.L), which operates in Iraq’s Kurdistan region, said while it was profitable at $30 a barrel, its spending will be scaled back and production impacted.
Kurdistan-focused producer Gulf Keystone suspended some of its drilling activities in the northern Iraqi region.
Kosmos Energy Ltd (KOS.N) has suspended its dividend and said it aimed to reduce 2020 capital spending by 30% with a view to becoming cash-flow neutral with an oil price of $35.
Papua New Guinea-focussed Oil Search Ltd (OSH.AX) cut its 2020 investment by 38% and capital spending by 44%.
Premier Oil Plc (PMO.L) said it had identified at least $100 million in potential savings on its 2020 capital spending plans.
Premier expects to be broadly cash-flow neutral in 2020, assuming a $100 million reduction in planned 2020 capital spending and a $35 oil price for the rest of the year.
Santos Ltd (STO.AX), Australia’s No. 2 independent gas producer, said it was reviewing all its capital spending plans and would stop all hiring.
Saudi Arabia’s state-run oil company Saudi Aramco (2222.SE) said it planned to cut capital spending for 2020 to between $25 billion and $30 billion, compared with $32.8 billion in 2019.
Tullow Oil Plc (TLW.L) said it would cut its investment budget by about a third to $350 million this year and reduce exploration spending, historically the group’s focus, by almost half to $75 million.
It said the oil price fall might jeopardize a plan to sell $1 billion in assets to refill its coffers, raising the risk the group’s lenders could become reluctant to approve loans essential to shoring up its future.
Wintershall Dea said it would cut 2020 investment by one-fifth to 1.2 billion to 1.5 billion euros ($1.3 billion to $1.7 billion) and suspend its dividend until further notice.
Reporting by Ron Bousso, Sonali Paul, Shadia Nasralla; Editing by Alexander Smith, Jan Harvey and Lisa Shumaker
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