Diversified Asset Portfolio to Map Future Production Growth

Wednesday 8 February 2012, Amsterdam

Diversified Asset Portfolio to Map Future Production Growth

Diversified Asset Portfolio to Map Future Production Growth

Newfield’s producing and upcoming assets portfolio is diversified both geographically as well as by type, providing the investor an exposure into various oil and gas plays. The company’s oil and gas assets are diversified across onshore and offshore, domestic (the US) and international, and conventional and unconventional resource plays. The figure below shows the asset base of the company as of December 2010.

See Figure: Newfield Exploration Company, Asset Portfolio, 2010

The company’s primary focus areas can be grouped into five divisions which include the mid-continent, the Rocky Mountains, the GoM, onshore Texas and the international division. The company’s unconventional resource plays are primarily located in the mid-continent and the Rocky Mountains divisions. The Woodford shale, situated in the mid-continent division, is dry gas shale with the thickness ranging from 100 to 200 feet. The company’s production in 2010 from this shale was around 169MMcfe/d. The other important unconventional play located in the mid-continent division is the granite wash. The company owns a net acreage of 48,000 acres in this play and the net production from this play in 2010 was 86MMcfe/d. The Greater Monument Butte area is the major asset of the company in the Rocky Mountains division. The company owns a net acreage of 183,000 acres and has around 1,200 producing wells in this area. Another important unconventional area of the company in the Rocky Mountains division is the Williston basin, with a net production of around 7,000boe/d in 2010. The other unconventional resources of the company include its interest in the Eagle Ford and Marcellus shale plays.

The conventional plays of the company are primarily located in the onshore Texas, GoM and international divisions. In the onshore Texas division, the company owns a net acreage of 195,000 acres. The company’s conventional production from this division in 2010 was 125MMcfe/d. The company’s deepwater assets are located in its GoM division. As of December 2010, the company owns interest in 84 deepwater leases in this division, with a net production of 95MMcfe/d. Furthermore, the company plans to commence production from two leases in this division in 2011, thereby increasing the division’s production by 8%. The international division of the company includes assets in countries such as Malaysia and China. The company’s production from the assets in the international division during 2010 was 19,000bo/d. Newfield also expects the production from this division to increase in the coming years, with the development of Pearl discovery in the Pearl River Mouth Basin of China expecting initial production in 2013.

The company plans to increase production from its diversified resource base beyond 2010. The total proved crude oil and natural gas reserves of the company in 2010 was 619.3MMboe, out of which around 75% was contributed by unconventional resources and the remaining 25% by conventional resources. Furthermore, the company has planned a total capex of $1.9 billion in 2011 out of which around 90% will be directed towards oil resources. The allocation of the 2011 capex towards mid-continent, Rocky Mountains, GoM, onshore Texas and international divisions was 33%, 34%, 2%, 15% and 16% respectively. As a result of the significant investments in its resources, the company production is expected to increase considerably during 2011–2015. According to the GlobalData estimates, the company’s total production is expected to increase from 47.2 MMboe in 2010 to 59.5 MMboe in 2015 at a CAGR of 4.7%. The figure below shows the company production forecast during 2011–2015.

Thus, the company’s diversified portfolio is experiencing a significant production increase, inclined primarily towards crude oil. The expected increase in production, coupled with the mitigation of risks due to diversification, ensures a steady stream of cash flows for the company in the future.

Newfield Exploration Company, Company Intelligence Report

Newfield Exploration Company, Company Intelligence Report

Publish date : January 2012
Report code : ASDR-25654
Pages : 118

ASDReports.com contact: S. Koomen

ASDReports.com / ASDMedia BV - Veemkade 356 - 1019HD Amsterdam - The Netherlands
P : +31(0)20 486 1286 - F : +31(0)20 486 0216

 back to News