TULSA, Okla.--(BUSINESS WIRE)-- WPX Energy (NYSE:WPX) is revising its plan for 2020, cutting $400 million – or approximately 25 percent – of its capital budget, with the flexibility to cut further.
“We will continue to assess the market and adjust our activity levels as necessary. You can expect us to be flexible and focused on generating free cash flow,” said WPX Chairman and Chief Executive Officer Rick Muncrief.
For 2020, WPX has 95,978 bbl/d of oil hedged with fixed price swaps at a weighted average price of $56.27 per barrel and 20,000 bbl/d with fixed price collars at a weighted average floor price of $53.33.
The revised capital plan of $1,275 million to $1,400 million maintains WPX’s current oil production of roughly 150,000 bbl/d for the balance of the year, which benefits from the March 6 acquisition of Felix Energy.
Based on the revised capital plan and today’s strip pricing, WPX expects to generate at least $150 million of free cash flow in 2020, not including savings for potential service price deflation.
Discussions with vendors about service costs are actively occurring, which presents known opportunities for WPX to lower capital further and increase its free cash flow target.
WPX plans to provide additional details and updates during its first-quarter 2020 press release and investor webcast.
Adds Muncrief, “Our balance sheet, liquidity, commodity hedges, and track record gives WPX an edge in a very difficult period. We’re also grateful for our business partners, service providers and vendors. We never take lightly how our decisions affect others.”
About WPX Energy, Inc.
WPX is an independent energy producer with core positions in the Permian and Williston basins. WPX’s production is approximately 80 percent oil/liquids and 20 percent natural gas. The company also has an infrastructure portfolio in the Permian Basin. Visit www.wpxenergy.com for more information.
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the company expects, believes or anticipates will or may occur in the future are forward-looking statements. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the company. Statements regarding future drilling and production are subject to all of the risks and uncertainties normally incident to the exploration for and development and production of oil and gas. These risks include, but are not limited to, the volatility of oil, natural gas and NGL prices; uncertainties inherent in estimating oil, natural gas and NGL reserves; drilling risks; environmental risks; and political or regulatory changes. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. The forward-looking statements in this press release are made as of the date of this press release, even if subsequently made available by WPX Energy on its website or otherwise. WPX Energy does not undertake and expressly disclaims any obligation to update the forward-looking statements as a result of new information, future events or otherwise. Investors are urged to consider carefully the disclosure in our filings with the Securities and Exchange Commission, available from us at WPX Energy, Attn: Investor Relations, P.O. Box 21810, Tulsa, Okla., 74102, or from the SEC’s website at www.sec.gov.
Source: WPX Energy Inc