HOUSTON, Feb. 10 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today announced financial and operating results for the fourth quarter and full-year 1999. Highlights from 1999 include:
-- 1999 production volumes increase 28% to 113.5 Bcfe -- Proved reserves increase 16% to 595 Bcfe at year-end 1999 -- 172% of 1999 production replaced with 195 Bcfe of reserve additions -- 1999 revenues reach record $282 million -- Finding and development costs were $1.08 per Mcfe
"1999 was an excellent year for Newfield," said David A. Trice, Newfield President & Chief Executive Officer. "We set out to improve our finding and development costs, grow our production and reserve base and continue our record of building value on a per share basis. We met these objectives and added a new focus area offshore Australia and strengthened our positions in the U.S. onshore Gulf Coast regions of Texas and Louisiana. We believe that our 2000 production will increase to 129 Bcfe before the closing of our recent south Texas acquisition. Assuming the acquisition closes by March 1 and no preferential rights are exercised, we expect it to add an additional 10 Bcfe to our 2000 volumes."
Fourth Quarter 1999
For the fourth quarter of 1999, Newfield reported net income of $16.6 million, or $0.39 cents per share, (all per share amounts are on a diluted basis), on revenues of $90.2 million. By comparison, the Company reported a net loss of $69.0 million, or $1.71 per share, on revenues of $50.5 million for the fourth quarter of 1998**. Stated without the effect of the one-time charge, the net loss in the fourth quarter of 1998 would have been $0.9 million, or $0.02 per share.
Operating cash flow before changes in working capital increased 85 percent in the fourth quarter of 1999 to $65.8 million, or $1.54 per share. This compares to operating cash flow of $35.6 million, $0.84 per share, in the fourth quarter of 1998. Net income, revenues and cash flow for the fourth quarter of 1999 all benefited from significantly higher production volumes and commodity prices.
Newfield's natural gas production in the fourth quarter of 1999 increased nearly 15 percent over the same period in 1998. The Company produced 22.4 Bcf of gas, or 243 million cubic feet per day (MMcf/d). The Company's average realized price for gas also increased significantly, averaging $2.67 per Mcf during the fourth quarter of 1999. For the same period of 1998, gas production totaled 19.6 Bcf, or 213 MMcf/d, sold at an average price of $2.06 per Mcf.
Crude oil and condensate production during the fourth quarter of 1999 increased more than 45 percent to 1.3 million barrels (MMBbls), or 14,587 barrels of oil per day (BOPD). The Company's average crude oil price for the quarter more than doubled over the prior period to $22.80 per barrel. In the fourth quarter of 1998, Newfield's oil production was 913 thousand barrels (MBbls), or 9,924 BOPD, sold for an average price of $11.21 per barrel. The significant increase in crude oil volumes reflects the acquisition of oil producing properties offshore Australia, closed during the third quarter of 1999. In the fourth quarter of 1999, Newfield's oil production from Australia totaled 448 MBbls, or 4,871 BOPD, sold for an average lifting price of $24.81 per barrel.
Newfield posted net income of $33.2 million, or $0.79 per share, on revenues of $282.0 million. This compares to a net loss of $57.7 million, or $1.55 per share, on revenues of $195.7 million**. Stated without the effect of the one-time charge, net income for 1998 would have been $10.4 million, or $0.26 per share. Operating cash flow before changes in working capital increased 45 percent to $205.6 million in 1999, or $4.86 per share, compared to $142 million, or $3.60 per share, in 1998.
Newfield posted record production in 1999. Oil and gas production increased 28 percent to 113.5 Bcfe in 1999 compared to 88.5 Bcfe in 1998. The significant increase in production volumes reflects the impact of producing property acquisitions and the success of the Company's exploration and development drilling programs.
Year-over-year natural gas production increased more than 30 percent to 87.4 Bcf, or an average of 239 MMcf/d. This compares to gas production of 66.6 Bcf, or 183 MMcf/d, in 1998. The Company's average realized natural gas price for 1999 was $2.32 per Mcf compared to $2.25 per Mcf in 1998.
Crude oil and condensate production in 1999 increased nearly 20 percent over 1998. Newfield produced 4.4 MMBbls, or 11,927 BOPD in 1999 compared to 3.6 MMBbls, or 9,982 BOPD in 1998. The significant increase in oil production is primarily related to the acquisition of producing oil properties offshore Australia and in the Gulf of Mexico. Newfield's oil production in Australia totaled 867 MBbls in 1999, averaging 5,131 BOPD since the acquisition closed on July 15, 1999. The average lifting price of the Australian crude was $22.37 per barrel. On a consolidated basis, Newfield's average realized oil price in 1999 increased more than 40 percent to $18.15 per barrel compared to $12.75 per barrel in 1998.
Stated on a unit of production basis, Newfield's lease operating expense was flat in 1999 compared to 1998 at $0.40 per Mcfe, or $45.6 million. Lease operating expense in 1998 was $35.3 million. Newfield's DD&A expense in 1999 decreased on a unit of production basis to $1.35 per Mcfe. DD&A expense for the year 1999 was $152.6 million. This compares to a DD&A expense of $1.39 per Mcfe, or $123.1 million, in 1998.
Finding and Development Costs
Newfield's worldwide cost to find and develop reserves, stated on an Mcfe basis, decreased about 40 percent to $1.08 per Mcfe in 1999 compared to $1.83 per Mcfe in 1998. Newfield's 1999 finding and development costs per Mcfe were nearly 20 percent lower than the Company's five-year average of $1.35 per Mcfe.
Reserve Replacement and Proved Reserves
During 1999, Newfield's worldwide reserve replacement was 172 percent of total production, which was 113.5 Bcfe. The Company's reserve replacement in 1998 was 188 percent of total production, which was 88.5 Bcfe. 1999 marks the 10th consecutive year that Newfield has more than replaced annual production with proved reserves.
At the end of 1999, Newfield had proved reserves of 595 Bcfe, an increase of 16 percent over proved reserves of 513 Bcfe at the end of 1998. Newfield's reserve mix shifted in 1999 with the acquisition of oil properties in Australia and the Gulf of Mexico. At year-end 1999, Newfield's reserves were 74 percent natural gas compared to 82 percent natural gas at year-end 1998. Seventy nine percent of the Company's U.S. reserves are natural gas and 94 percent of the Company's total proved reserves are located in the U.S.
For the full-year 1999, Newfield invested $210 million, including $86 million for property acquisitions. This compares to capital spending of $311 million in 1998. Excluding acquisitions, the largest component of 1999 spending was for development, totaling $72 million. About $50 million was spent on exploration. The Company's exploration/exploitation success rate was 63% in 1999, making 12 discoveries out of 19 wells.
Newfield expects its 2000 capital budget to be $315 million, which includes about $137 million for the Company's recent acquisition of producing gas fields in south Texas. The 2000 capital spending plan includes $104 million for development and $42 million for exploration. The international component of the budget is $32 million. The Company plans to fund the budget through cash flow and borrowings under the Company's revolving credit facility.
Newfield Exploration is an independent crude oil and natural gas exploration and production company. The Company has a solid asset base of producing properties and exploration and development drilling opportunities primarily in the Gulf of Mexico with operations along the U.S. Gulf Coast and offshore Australia.
A table with fourth quarter and full-year 1999 summary financials is attached.
*Certain of the statements set forth in this news release regarding production expectations, capital expenditures and activities are forward looking and are based upon assumptions and anticipated results that are subject to numerous uncertainties. Actual results may vary significantly from those anticipated due to many factors, including drilling results, oil and gas prices, industry conditions, the prices of goods and services, the availability of drilling rigs and other support services and the availability of capital resources. In addition, the drilling of oil and gas wells and the production of hydrocarbons are subject to governmental regulations and operating risks.
** The net loss in 1998 reflects a $68 million after-tax ceiling test writedown in the fourth quarter of 1998. A requirement of full-cost accounting, the writedown reduced the carrying value of Newfield's oil and gas properties. It was caused primarily by the low oil and gas prices at year-end 1998.
Newfield Exploration Company For information, contact: 363 N. Sam Houston Parkway East, Ste. 2020 Steve Campbell Houston, TX 77060 281-847-6081 www.newfld.com firstname.lastname@example.org NEWFIELD EXPLORATION COMPANY YEAR-END RESULTS (In Thousands, Except Per Share Amounts) (Unaudited) Three Months Ended Year Ended December 31, December 31, 1999 1998 1999 1998 Revenues $ 90,242 $ 50,505 $ 281,967 $ 195,685 Net Cash Provided by Operating Activities Before Changes in Operating Assets and Liabilities $ 65,792 $ 35,630 $ 205,553 $ 141,948 Income (Loss) Before Taxes $ 25,971 $(105,971) $ 52,015 $ (88,376) Net Income (Loss) $ 16,594 $ (69,033) $ 33,204 $ (57,699) Basic Earnings (Loss) Per Share $ 0.40 $ (1.71) $ 0.81 $ (1.55) Diluted Earnings (Loss) Per Share $ 0.39 $ (1.71) $ 0.79 $ (1.55) Weighted Average Basic Common Shares Outstanding 41,654 40,301 41,194 37,312 Weighted Average Diluted Common Shares Outstanding 42,586 40,301(A) 42,294 37,312(A) (A) Absent a loss in this period, the outstanding shares would have been 42,412 and 39,455 for the three months and year ended December 31, 1998, respectively.
SOURCE Newfield Exploration Company
Web site: http: //www.newfld.com
CONTACT: Steve Campbell of Newfield Exploration Company, 281-847-6081, or email, email@example.com