XTO Energy Inc. reported that its natural gas-weighted production in the first three months of the year jumped 10% from a comparable period in 2006 to 1.602 Bcfe/d from 1.460 Bcfe/d, powered by its leasehold in the Barnett Shale. The Fort Worth-based independent expects to sustain at least 10% production growth through the year, executives said.
Gas production averaged 1.264 Bcf/d, up 12% from the 1.126 Bcf/d reported in 1Q2006. Daily oil production rose 2% to 45,649 bbl, while natural gas liquids (NGL) output fell 3% to 10,811 bbl/d.
"With 73 drilling rigs active, our development teams continue to drive production upwards with natural gas volumes increasing by about 3% from last quarter," said President Keith Hutton. "In the East Texas region, production improved by almost 4%, as the Freestone Trend reached average daily gross production of 577 MMcf. In the Barnett Shale, production beat our projections again as volumes moved up 12% from the previous period to 249 MMcf/d net to XTO."
Hutton said testing is now under way in the Piceance Basin on XTO's first completed well with a sustained daily rate of 3 MMcf producing from two-thirds of the 900-foot pay section. And by the beginning of May, the company will begin drilling its first well in the Fayetteville Shale, he said.
"Across the board, our activity is on pace to deliver another exceptional year of double-digit growth," Hutton told investors on a conference call Wednesday.
On lower gas prices, XTO's total revenues dropped 4% in the quarter to $1.17 billion from $1.22 billion in 1Q2006. Earnings fell to $383 million ($1.04/share) from $467 million ($1.28). Excluding the effects of a noncash change in derivatives, XTO's adjusted 1Q2007 earnings were $406 million ($1.11/share). The average gas price for the quarter plunged 19% to $7.37/Mcf from $9.08 in 1Q2006. The average oil price was $66.62/bbl, up 17% from 1Q2006's average of $56.98. NGL prices averaged $35.97/bbl versus $34.76/bbl a year earlier.
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