Kerr-McGee Inc. reaffirmed its oil and gas production forecast for this year, but warned investors that total output in 2004 could drop more than 7%, after the planned sale of some of its producing assets.

In its interim fourth quarter forecast released on Tuesday, Kerr-McGee management adjusted the Oklahoma City-based producer’s full-year guidance for the second time in less than two months. Management now expects to hit the high end of its year-end forecast of 271,000 boe/d.

During an October conference call following the release of the company’s third quarter earnings, Kerr-McGee put expectations for 2003 production at 242,000-269,000 boe/d.

In the fourth quarter, combined oil and gas quarterly production is expected to range between 247,200-267,500 boe/d. Natural gas production will range between 685-785 MMcf/d, while crude oil production will range between 133,000-142,500 bbl/d.

Rick Buterbaugh, vice president of investor relations, added that production costs for the year would decline to $4.05/boe.

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