Enron Oil & Gas second-quarter earnings were hit by weak oilprices but buoyed by stronger gas prices. Second quarter 1998 NorthAmerican wellhead gas prices averaged $1.96/Mcf, up 9% versus anaverage of $1.80/Mcf in the second quarter of 1997. North Americancrude oil and condensate prices were $12.82/barrel for the secondquarter of 1998, down 32% as compared to $18.89/barrel a year ago.
The company reported net income of $13.3 million, or $.09 pershare, compared to net income of $24.6 million, or $.16 per share,for the comparable period a year ago. Operating income increased to$32.7 million versus $28.6 million in the second quarter a yearago.
Second-quarter gas deliveries averaged 907 MMcf/d and crude oil,condensate and gas liquids deliveries averaged 26.0 thousandbarrels per day (MBD), compared to second quarter 1997 deliveriesof 896 MMcf/d and 20.3 MBD, respectively. India and Trinidad gasvolumes increased to 185 MMcf/d from 115 MMcf/d in 1997.
Total North America wellhead gas production averaged 722 MMcf/din the second quarter of 1998 compared to 781 MMcf/d a year ago.The 1997 second quarter reflects benefits from an acquisition andthe accelerated pay-out of a South Texas property.
“Overall, natural gas supply remains tight due to a number offactors, including total budget cutbacks related to lower oilprices, increasing production decline rates, increased costs,reduced drilling efficiencies and increased time requirements toevaluate 3-D data-intensive prospects,” said Forrest E. Hoglund,CEO. “As a result of these trends, we expect a continued strongnatural gas market.” Based on drilling completed, but not yeton-line, and current drilling plans, the company expects NorthAmerica volumes in the second half of 1998 to well exceed volumesreported in the first half, reflecting drilling success primarilyin Texas, New Mexico and Oklahoma.
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