ConocoPhillips, Houston, (NYSE: COP) reports production from its E&P segment for the first-quarter was 1.83 million barrels of oil equivalent per day, compared to 1.93 million barrels equivalent per day in the same period in 2009.
The decrease was mainly due to normal field decline, primarily in the U.K., Lower 48 and Alaska; increased impacts from production sharing agreements, mostly in Asia Pacific; and unplanned downtime in the Lower 48 due to weather conditions. Increased production from China and Canadian oil sands partially offset the decrease.
ConocoPhillips chairman and chief executive Jim Mulva says, “The higher crude oil and natural gas liquids prices resulted in improved earnings across our E&P portfolio. Within the Lower 48, where more than a third of our production is liquids, our presence in the Bakken, Permian, San Juan and offshore Gulf of Mexico areas enabled us to benefit from the higher prices which, along with ongoing cost reductions, resulted in substantially improved Lower 48 E&P earnings.”
The company continued to ramp-up its drilling program in the Eagle Ford shale play during the quarter. ConocoPhillips has three rigs drilling in the play and has completed the drilling of four horizontal wells. The first of these wells was placed on production in late March and had initial production of 3.8 million cubic feet of gas and 1,200 barrels of condensate for a total 10.5 million cubic feet equivalent per day. This well and other industry drilling results reinforced the potential of ConocoPhillips’ 240,000-net acre position in the liquids-rich core of this play.
In the Bakken shale play, three wells were spud during March, bringing the total current year well count to six. Three wells were placed on production during March with initial rates of approximately 2,000 barrels of oil per day each.
Mulva says, “Improving market conditions in the first quarter contributed to increased earnings. Our performance in the first quarter was solid, with E&P production in line with the fourth quarter of the prior year. This allowed us to capture the benefit of significantly improved oil prices.”
ConocoPhillips is one of the world’s largest integrated energy companies, with worldwide oil and gas assets.
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