Tulsa-based WPX Energy Inc. plans to add another rig to its Permian Basin operations and complete 15 uncompleted wells in the Williston Basin as part of an overall plan to increase full-year oil production guidance by 5%.
The onshore-focused independent said Monday it has increased 2016 guidance to an average of 39,000-41,000 b/d, 5% higher than previous guidance of 37,000-39,000 b/d. Total oil and gas output this year now is forecast 3% higher at 77,000-82,000 boe/d from previous guidance of 75,000-80,000 boe/d.
The increase in production follows better-than-expected well performance, as well as a planned boost in drilling and completion activity through the rest of this year in the Permian's Delaware and Williston basins. A third rig is scheduled to be added to the Delaware in October, and 15 of 20 drilled but uncompleted wells, DUCs, are scheduled for completion beginning in August.
"We are well positioned to leverage our operational momentum in ways that can accelerate and enhance the value we deliver to stockholders," said CEO Rick Muncrief. "The steps we're taking to increase activity in our world-class assets are consistent with our emphasis on remaining opportunistic."
Even with the increase in activity this year, the updated drilling and completion budget for 2016 of $400-450 million "remains within the original guidance range of $350 million to $450 million."
Additionally, WPX plans to expand its owned and operated midstream infrastructure in the Delaware with a new crude oil gathering system to support its acreage position in the Stateline area. Last year WPX expanded its Permian position, particularly its acreage in the Delaware, with a $2.75 billion deal to buy RKI Exploration & Production LLC's Permian operations (see Shale Daily,July 14, 2015).
The crude line, set to be commissioned next year, would improve oil differentials for the Delaware production, management said. WPX's existing infrastructure in the Delaware now is comprised of natural gas gathering and water gathering and transfer lines.
Also Monday, WPX launched a public offering for 45 million shares of common stock. Net proceeds are being used for general corporate purposes, including accelerated drilling and completion activities, as well as "bolt-on acreage acquisition and midstream infrastructure in the Delaware Basin."