Capital efficiency showing meaningful
progress year-to-date
Noble Energy, Inc. (NYSE: NBL) (“Noble Energy” or the
“Company”) today announced first quarter 2019 financial and
operating results. Highlights include:
- Organic capital expenditures funded by
Noble Energy totaled $683 million, below the low end of guidance, a
result of lower spend in the U.S. onshore and Israel.
- Delivered total Company sales volumes
of 337 MBoe/d and U.S. onshore volumes of 253 MBoe/d, exceeding the
top end of guidance.
- Produced a quarterly record in the DJ
Basin of 144 MBoe/d, driven by strong base performance and Mustang
IDP growth.
- Progressed Leviathan to 81% complete,
with first gas sales expected by the end of 2019.
- Sanctioned the Alen gas monetization
project in Equatorial Guinea with initial sales planned for the
first half of 2021.
- Farmed into two exploration blocks
offshore Colombia; Noble Energy operates the blocks with a 40%
working interest.
- Noble Midstream Partners closed
its options with EPIC Midstream Holdings to acquire a 15% equity
interest in the Y-grade pipeline and a 30% equity interest in the
crude oil pipeline.
David L. Stover, Noble Energy’s Chairman and CEO, commented,
“Noble Energy is off to a great start in 2019, building upon our
success in the second half of 2018, with capital expenditures below
and production above plan. Earlier this year, Noble Energy outlined
a path to deliver long-term sustainable value creation through
capital efficiency and prioritizing returns over headline volume
growth. Our onshore accomplishments in 2019 include lower well
costs in each of our basins, reduced cycle times and strong
production. Offshore, we are uniquely positioned with world-class
international projects that have minimal to no decline, and by the
end of the year, Leviathan is expected to be generating significant
new cash flow for our Company. I am pleased with our
accomplishments to-date, our momentum on 2019 delivery, and our
pathway to organic free cash flow generation.”
First Quarter 2019
Results
The Company reported a first quarter net loss attributable to
Noble Energy of $313 million, or $0.65 per diluted share. Net loss
including noncontrolling interest was $289 million. Excluding items
impacting comparability, the Company generated an adjusted net loss
and adjusted net loss per share(1) attributable to Noble Energy for
the quarter of $44 million, or $0.09 per diluted share. Adjusted
EBITDAX(1) was $562 million, and cash provided by operating
activities was $528 million.
The Company’s effective tax rate, after excluding items
impacting comparability of earnings to prior periods, was
approximately 40%. On this basis, current tax expense was $19
million, resulting from the income generated in West Africa and
Israel. Deferred taxes were a benefit of $35 million on this same
basis.
First quarter 2019 organic capital investments attributable to
Noble Energy included $487 million related to U.S. onshore upstream
activities and $37 million for midstream activities funded by the
Company. These amounts were lower than anticipated as a result of
reduced well costs and facility expenditures. The Company also
invested $132 million in the Eastern Mediterranean, primarily for
the development of the Leviathan project. Noble Energy’s
acquisition capital for the first quarter amounted to $39 million,
which primarily represented U.S. onshore exploration acreage
capture.
Total Company sales volumes for the first quarter 2019 were 337
thousand barrels of oil equivalent per day (MBoe/d). Total Company
liquids sales volumes (crude oil and natural gas liquids) averaged
190 thousand barrels per day (MBbl/d) for the first quarter 2019,
or 56 percent of total volumes. The Company’s U.S. onshore assets
produced 75 percent of sales volumes, Equatorial Guinea (E.G.)
represented 13 percent and Israel comprised 12 percent. Each
business unit in the U.S. onshore performed in line or above
expectation while International volumes benefitted from high demand
in Israel and shorter than anticipated facility maintenance in
E.G.
Unit production expenses for the first quarter 2019 were $10.02
per barrel of oil equivalent (BOE), including lease operating
expenses, production taxes, gathering and transportation expenses,
and other royalty costs. Unit production expenses benefitted from
cost management and production outperformance, primarily in the
U.S. onshore business. Depreciation, depletion and amortization was
$16.71 per BOE and general and administrative expenses totaled $102
million for the quarter.
Income from equity method investees for the first quarter
totaled $17 million, in line with expectation as a result of
planned maintenance at the onshore plant facilities in E.G.
The results for Noble Midstream Partners LP (“NBLX”) (NYSE:
NBLX) are consolidated into Noble Energy’s financial statements,
including $29 million in organic capital expenditures funded by
NBLX in the first quarter. In addition, NBLX had $271 million in
equity method investments in the first quarter 2019 relating to its
acquisition of interests in the EPIC Y-grade and crude oil
pipelines along with its joint venture investment for a new
Delaware Basin oil pipeline from Reeves County to Wink, Texas.
Midstream Services Revenue of $24 million for the quarter was
primarily composed of NBLX’s gathering revenue from unaffiliated
third parties. The public’s 55 percent ownership of first quarter
net income attributable to NBLX, $24 million, has been excluded
from net income attributable to Noble Energy.
Well Performance and Capital Efficiency
Drive U.S. Onshore Performance
Total sales volumes across the Company’s U.S. onshore assets
averaged 253 MBoe/d in the first quarter 2019. The Company produced
total liquids volumes of 173 MBbl/d of which oil production was 113
MBbl/d. First quarter 2019 volumes reflect another quarterly
production record for the Company’s DJ Basin asset.
Noble Energy continued to drive capital efficiency in the U.S.
onshore business, delivering execution improvements to sustainably
reduce well costs and improve cycle times, with many of the
improvements a result of the Company’s row development process. As
compared to the fourth quarter of 2018, pumping hours per day
improved 5 to 10 percent, contributing to lower than budgeted well
costs and accelerated first production for new wells.
The DJ Basin averaged 144 MBoe/d, an increase of five percent
sequentially and 21% from the first quarter 2018, while continuing
to generate operating cash flows in excess of capital expenditures.
The increased volumes for the quarter were driven primarily by the
completion activity at Row 2 in the Mustang area, where the company
brought online 21 wells in the western portion of the row. Mustang
production averaged 39 MBoe/d in the quarter, with nearly 55
percent of the volume being oil. Wells Ranch grew to 66 MBoe/d in
the first quarter, benefitted by additional gas offload.
Sales volumes from the Company’s Delaware Basin assets totaled
59 MBoe/d, up 30% from the first quarter of 2018. Early in the
year, the Company closed on the divestment of a 13,000 net acre
position in the southwest portion of the Company’s acreage. The
divestment included approximately 1,000 Boe/d of production. During
the first quarter, the Company brought online nine wells to
production. The new wells generated an average IP-30 rate of 1,560
Boe/d (68% oil). Excluding two of these wells, which were drilled
in the Company’s southwest acreage for lease retention purposes,
the IP-30 production average was 211 Boe/d per 1,000 lateral
feet.
Sales volumes from the Eagle Ford totaled 50 MBoe/d for the
first quarter while continuing to generate operating cash flows
above capital expenditures. Seven drilled-but-uncompleted wells
commenced production during the quarter from the Company’s North
Gates Ranch area.
Across the U.S. onshore portfolio, the Company operated six rigs
(2 DJ and 4 Delaware) and drilled 42 wells (26 DJ and 16 Delaware)
in the quarter. Noble Energy commenced production on 37 wells (21
DJ, 9 Delaware, 7 Eagle Ford) and completed 56 wells (29 DJ, 20
Delaware, 7 Eagle Ford).
Offshore Major Projects Driving
Long-term Sustainable Cash Flow Profile
First quarter net sales volumes from the Company’s assets in
Israel totaled 235 million cubic feet of natural gas equivalent per
day (MMcfe/d). Production on a gross basis exceeded one billion
cubic feet of natural gas equivalent per day, above expectation as
a result of higher domestic natural gas demand.
The Leviathan project is 81 percent complete. Project highlights
during the first quarter include jacket and pile installation,
production manifold installation and completion of pipeline
installation. The next major milestone will be the loading and
shipping of the platform topsides expected by the end of the second
quarter. The project remains on budget and on schedule for first
production by the end of 2019.
Sales volumes for West Africa were 45 MBoe/d, including 13
MBbl/d of crude oil. Production volumes exceeded sales volumes by
approximately 2 MBbl/d due to the timing of cargo liftings in E.G.
During the quarter, the onshore plant facilities, which process
Alba field gas, incurred downtime for routine maintenance. The
maintenance was completed ahead of schedule, and the plants and
Alba field returned to full capacity. Active reservoir management,
including optimized field injection, is delivering lower production
declines than previously expected at the Company’s operated Aseng
and Alen fields.
At the end of the quarter, Noble Energy announced the sanction
of the Alen gas monetization project. At start-up, incremental
sales from the Alen field are anticipated to be between 200 and 300
MMcfe/d, gross (~75 to 115 MMcfe/d net to Noble Energy), including
condensate, NGL, and natural gas volumes.
Exploration Focused on Quality;
High-impact, Low-risk Opportunities
Noble Energy finalized an agreement to farm into two deepwater
blocks offshore Colombia, totaling 2.2 million acres. The
prospectivity on the blocks includes both liquids and natural gas
resource potential. Noble Energy operates both blocks with a 40%
working interest. A prospect is planned to be drilled in 2020.
The Company also had significant success in the quarter
continuing to build its onshore unconventional exploration
position. Over the past two years, the Company has amassed more
than 140,000 acres in two plays in Wyoming at an average cost of
less than $430 per acre.
Executing to Plan, Full Year Guidance
Maintained
The Company’s full year capital expenditures guidance and sales
volume expectations remain unchanged.
Sales volumes for the second quarter of 2019 are expected to be
slightly higher than the first quarter, reflecting increased U.S.
onshore production and relatively flat International volumes. The
Company’s second quarter sales volumes range is 332 to 347 MBoe/d.
In the U.S. onshore, total production and oil volumes are expected
to increase slightly from the first quarter, driven by an increased
turn in-line well count in the DJ and Delaware Basins. The
Company’s second quarter TILs will drive a substantial increase in
third quarter production. As guided earlier in the year, second
half U.S. Onshore production is anticipated to be approximately 15%
higher than the first half of the year.
Internationally, sales volumes for the second quarter are
anticipated to be relatively flat with the first quarter. West
Africa is expected to be up slightly, driven by higher Alba field
gas production following onshore plant maintenance in the first
quarter. Consistent with the first quarter, liquids sales volumes
are anticipated to be less than production volumes, before
reversing in the second half of the year. In Israel, second quarter
production volumes will be slightly lower than the first quarter
due to seasonal holiday impacts.
For the second quarter, Noble Energy expects organic capital
expenditures between $675 million and $750 million, with the
majority to be spent in the DJ and Delaware Basins and to progress
Leviathan development.
Additional guidance details can be found in the Company’s latest
presentation on the Company’s website, www.nblenergy.com.
(1)
A Non-GAAP measure, please see the
respective earnings release schedules included herein for
reconciliations.
Webcast and Conference Call
Information
Noble Energy, Inc. will host a live audio webcast and conference
call at 8:00 a.m. Central Time on May 3, 2019. The webcast link is
accessible on the ‘Investors’ page at www.nblenergy.com. A replay will be available on
the website. Conference call numbers for participation during the
question and answer session are:
Toll Free Dial in: 877-883-0383
International Dial in: 412-902-6506
Conference ID: 4600542
Noble Energy (NYSE: NBL) is an independent oil and
natural gas exploration and production company committed to meeting
the world’s growing energy needs and delivering leading returns to
shareholders. The Company operates a high-quality portfolio of
assets onshore in the United States and offshore in the Eastern
Mediterranean and off the west coast of Africa. Founded more than
85 years ago, Noble Energy is guided by its values, its commitment
to safety, and respect for stakeholders, communities and the
environment. For more information on how the Company fulfills its
purpose: Energizing the World, Bettering People’s Lives®, visit
https://www.nblenergy.com.
This news release contains certain “forward-looking statements”
within the meaning of federal securities laws. Words such as
“anticipates”, “plans”, “estimates”, “believes”, “expects”,
“intends”, “will”, “should”, “may”, and similar expressions may be
used to identify forward-looking statements. Forward-looking
statements are not statements of historical fact and reflect Noble
Energy’s current views about future events. Such forward-looking
statements may include, but are not limited to, future financial
and operating results, and other statements that are not historical
facts, including estimates of oil and natural gas reserves and
resources, estimates of future production, assumptions regarding
future oil and natural gas pricing, planned drilling activity,
future results of operations, projected cash flow and liquidity,
business strategy and other plans and objectives for future
operations. No assurances can be given that the forward-looking
statements contained in this news release will occur as projected
and actual results may differ materially from those projected.
Forward-looking statements are based on current expectations,
estimates and assumptions that involve a number of risks and
uncertainties that could cause actual results to differ materially
from those projected. These risks and uncertainties include,
without limitation, volatility in commodity prices for crude oil
and natural gas, the presence or recoverability of estimated
reserves, the ability to replace reserves, environmental risks,
drilling and operating risks, exploration and development risks,
competition, government regulation or other actions, the ability of
management to execute its plans to meet its goals and other risks
inherent in Noble Energy’s businesses that are discussed in Noble
Energy’s most recent annual report on Form 10-K, quarterly report
on Form 10-Q, and in other Noble Energy reports on file with the
Securities and Exchange Commission (the "SEC"). These reports are
also available from the sources described above. Forward-looking
statements are based on the estimates and opinions of management at
the time the statements are made. Noble Energy does not assume any
obligation to update any forward-looking statements should
circumstances or management’s estimates or opinions change.
This news release also contains certain historical non-GAAP
measures of financial performance that management believes are good
tools for internal use and the investment community in evaluating
Noble Energy’s overall financial performance. These non-GAAP
measures are broadly used to value and compare companies in the
crude oil and natural gas industry. Please see Noble Energy’s
earnings release schedules included herein for reconciliations of
the differences between any historical non-GAAP measures used in
this news release and the most directly comparable GAAP financial
measures.
Schedule 1 Noble Energy, Inc. Summary
Statement of Operations (in millions, except per share
amounts, unaudited)
Three Months EndedMarch 31,
2019 2018
Revenues Oil, NGL and
Gas Sales $ 937 $ 1,173 Sales of Purchased Oil and Gas 74 53 Income
from Equity Method Investees 17 47 Midstream Services Revenues –
Third Party 24 13 Total Revenues 1,052
1,286
Operating Expenses Lease Operating Expense 151 155
Production and Ad Valorem Taxes 49 54 Gathering, Transportation and
Processing Expense 102 93 Other Royalty Expense 3 17 Exploration
Expense 24 35 Depreciation, Depletion and Amortization 508 468
General and Administrative 102 104 Cost of Purchased Oil and Gas 87
57 Other Operating Expense, Net 25 15 Gain on Divestitures, Net —
(588 ) Asset Impairments — 168 Firm Transportation Exit Cost 92
— Total Operating Expenses 1,143
578
Operating (Loss) Income (91 ) 708
Other Expense Loss on Commodity Derivative Instruments 212
79 Interest, Net of Amount Capitalized 66 73 Other Non-Operating
Expense, Net 4 13 Total Other Expense
282 165
(Loss) Income Before Income
Taxes (373 ) 543 Income Tax Benefit (84 ) (31 )
Net (Loss) Income and Comprehensive (Loss) Income Including
Noncontrolling Interests (289 ) 574
Less: Net Income and
Comprehensive Income Attributable to Noncontrolling Interests
(1) 24 20
Net (Loss) Income
and Comprehensive (Loss) Income Attributable to Noble Energy $
(313 ) $ 554
Net (Loss) Income
Attributable to Noble Energy Per Share of Common Stock (Loss)
Income Per Share, Basic $ (0.65 ) $ 1.14 (Loss) Income Per Share,
Diluted $ (0.65 ) $ 1.14
Weighted Average Number of
Shares Outstanding Basic 478 487 Diluted 478 488
(1)
The Company consolidates Noble Midstream
Partners LP (NBLX), a publicly traded subsidiary of Noble Energy,
as a variable interest entity for financial reporting purposes. The
public's ownership interest in NBLX is reflected as a
noncontrolling interest in the financial statements.
These financial statements should be read
in conjunction with the financial statements and the accompanying
notes and other information included in Noble Energy's Quarterly
Report on Form 10-Q to be filed with the Securities and Exchange
Commission on May 3, 2019.
Schedule 2 Noble Energy, Inc.
Condensed Statement of Cash Flows (in millions,
unaudited)
Three Months EndedMarch 31,
2019 2018
Cash Flows From Operating Activities
Net (Loss) Income Including Noncontrolling Interests
(1) $ (289 ) $ 574 Adjustments to Reconcile Net (Loss)
Income to Net Cash Provided by Operating Activities Depreciation,
Depletion and Amortization 508 468 Gain on Divestitures, Net — (588
) Asset Impairments — 168 Firm Transportation Exit Cost 92 —
Deferred Income Tax Benefit (100 ) (157 ) Loss on Commodity
Derivative Instruments 212 79 Net Cash Received (Paid) in
Settlement of Commodity Derivative Instruments 14 (28 ) Other
Adjustments for Noncash Items Included in Income 28 (2 ) Net
Changes in Working Capital 63 69
Net
Cash Provided by Operating Activities 528
583
Cash Flows From Investing Activities Additions to
Property, Plant and Equipment (763 ) (787 ) Acquisitions, Net of
Cash Received (2) — (650 ) Additions to Equity Method Investments
(3) (271 ) — Proceeds from Divestitures, Net (4) 123
865
Net Cash Used in Investing Activities (911
) (572 )
Cash Flows From Financing Activities
Dividends Paid, Common Stock (53 ) (48 ) Purchase and Retirement of
Common Stock — (67 ) Noble Midstream Services Revolving Credit
Facility, Net 170 350 Revolving Credit Facility, Net — (230 )
Contributions from Noncontrolling Interest Owners 10 333 Proceeds
from Issuance of Mezzanine Equity, Net of Offering Costs (5) 99 —
Other (32 ) (40 )
Net Cash Provided by Financing
Activities 194 298
(Decrease)
Increase in Cash, Cash Equivalents, and Restricted Cash (189 )
309
Cash, Cash Equivalents, and Restricted Cash at Beginning of
Period (6) 719 713
Cash,
Cash Equivalents, and Restricted Cash at End of Period
(7) $ 530 $ 1,022
(1)
The Company consolidates Noble Midstream
Partners LP (NBLX), a publicly traded subsidiary of Noble Energy,
as a variable interest entity for financial reporting purposes. For
the three months ended March 31, 2019, Net (Loss) Income includes
Net Income Attributable to Noncontrolling Interests in NBLX.
(2)
For the three months ended March 31, 2018,
acquisitions, net of cash received, related to 100 percent of the
acquisition of Saddle Butte Rockies Midstream, LLC by NBLX.
(3)
For the three months ended March 31, 2019,
additions related to initial investments in the EPIC Pipelines and
Delaware Crossing Joint Venture by NBLX.
(4)
For the three months ended March 31, 2019,
proceeds related to the SW Reeves County, Texas asset divestiture.
For the three months ended March 31, 2018, proceeds include $487
million from the sale of our 7.5% interest in Tamar field and $308
million from the sale of CONE Gathering LLC.
(5)
For the three months ended March 31, 2019,
proceeds related to the issuance of preferred equity by NBLX. As
the preferred equity is redeemable, it is presented within the
mezzanine section of our consolidated balance sheet. In addition,
as the preferred equity is held by a third party, it is considered
a redeemable noncontrolling interest.
(6)
As of the beginning of the periods
presented, amounts include $3 million and $38 million of restricted
cash, respectively.
(7)
As of March 31, 2019 and March 31, 2018,
amounts include $2 million and $30 million of restricted cash,
respectively.
These financial statements should be read
in conjunction with the financial statements and the accompanying
notes and other information included in Noble Energy's Quarterly
Report on Form 10-Q to be filed with the Securities and Exchange
Commission on May 3, 2019.
Schedule 3 Noble Energy, Inc.
Condensed Balance Sheets (in millions, unaudited)
March 31,2019
December 31,2018
Assets Current Assets Cash and Cash
Equivalents $ 528 $ 716 Accounts Receivable, Net 573 616 Other
Current Assets 142 418
Total Current
Assets 1,243 1,750 Net Property, Plant and Equipment 18,701
18,419 Other Noncurrent Assets 1,376 841
Total Assets $ 21,320 $ 21,010
Liabilities, Mezzanine Equity and Shareholders' Equity
Current Liabilities Accounts Payable - Trade $ 1,284 $ 1,207 Other
Current Liabilities 659 519
Total Current
Liabilities 1,943 1,726 Long-Term Debt 6,738 6,574 Deferred
Income Taxes 961 1,061 Other Noncurrent Liabilities 1,438
1,165
Total Liabilities 11,080
10,526
Total Mezzanine Equity (1) 97 —
Total Shareholders' Equity 9,071 9,426 Noncontrolling
Interests (2) 1,072 1,058
Total Equity
10,143 10,484
Total Liabilities and
Equity $ 21,320 $ 21,010 (1)
Amount relates to preferred equity issued
by Noble Midstream Partners LP (NBLX). As the preferred equity is
redeemable, it is presented within the mezzanine section of our
consolidated balance sheet. In addition, as the preferred equity is
held by a third party, it is considered a redeemable noncontrolling
interest.
(2)
The Company consolidates NBLX, a publicly
traded subsidiary of Noble Energy, as a variable interest entity
for financial reporting purposes. The public's ownership interest
in NBLX is reflected as a noncontrolling interest in the financial
statements.
These financial statements should be read
in conjunction with the financial statements and the accompanying
notes and other information included in Noble Energy's Quarterly
Report on Form 10-Q to be filed with the Securities and Exchange
Commission on May 3, 2019.
Schedule 4 Noble Energy, Inc. Volume
and Price Statistics (unaudited)
Three Months EndedMarch 31,
Sales Volumes 2019 2018
Crude Oil and
Condensate (MBbl/d) United States Onshore 113 103
United States Gulf of Mexico — 19 Equatorial Guinea 12 15 Equity
Method Investee - Equatorial Guinea 1 2 Total
(1) 127 139
Natural Gas Liquids
(MBbl/d) United States Onshore 59 63 United States Gulf of
Mexico — 1 Equity Method Investee - Equatorial Guinea 4
5 Total 63 69
Natural Gas
(MMcf/d) United States Onshore 483 482 United States Gulf of
Mexico — 22 Israel 233 261 Equatorial Guinea 168
206 Total 884 971
Total Sales
Volumes (MBoe/d) United States Onshore 253 246 United States
Gulf of Mexico — 24 Israel 39 44 Equatorial Guinea 40 49 Equity
Method Investee - Equatorial Guinea 5 7 Total
Sales Volumes (MBoe/d) 337 370 Total Sales
Volumes (MBoe) 30,375 33,272
Price Statistics - Realized
Prices (2) Crude Oil and Condensate ($/Bbl)
United States Onshore $ 53.46 $ 61.50 United States Gulf of Mexico
— 64.55 Equatorial Guinea 61.01 68.14
Natural Gas Liquids
($/Bbl) United States Onshore $ 17.86 $ 25.47 United States
Gulf of Mexico — 28.41
Natural Gas ($/Mcf) United States
Onshore $ 2.49 $ 2.60 United States Gulf of Mexico — 3.54 Israel
5.57 5.48 Equatorial Guinea 0.27 0.27 (1)
Total includes a small amount of
condensate from the Company’s offshore Israel assets.
(2)
Average realized prices do not include
gains or losses on commodity derivative instruments.
Schedule 5
Noble Energy, Inc.
Reconciliation of Net (Loss) Income
Attributable to Noble Energy and Per Share (GAAP) to
Adjusted Net (Loss) Income Attributable
to Noble Energy and Per Share (Non-GAAP)
(in millions, except per share amounts,
unaudited)
Adjusted net (loss) income attributable to Noble Energy and per
share (Non-GAAP) should not be considered an alternative to, or
more meaningful than, net (loss) income attributable to Noble
Energy and per share (GAAP) or any other measure as reported in
accordance with GAAP. Our management believes, and certain
investors may find, that adjusted net (loss) income attributable to
Noble Energy and per share (Non-GAAP) is beneficial in evaluating
our operating and financial performance because it eliminates the
impact of certain items affecting comparability (typically noncash
and/or nonrecurring items) that management does not consider to be
indicative of our performance from period to period. We believe
this Non-GAAP measure is used by analysts and investors to evaluate
and compare our operating and financial performance across periods.
As a performance measure, adjusted net (loss) income attributable
to Noble Energy and per share (Non-GAAP) may be useful for
comparison of earnings and per share to forecasts prepared by
analysts and other third parties. However, our presentation of
adjusted net (loss) income attributable to Noble Energy and per
share (Non-GAAP), may not be comparable to similar measures of
other companies in our industry.
Three Months EndedMarch 31,
2019 2018
Net (Loss) Income Attributable to Noble
Energy (GAAP) $ (313 ) $ 554 Adjustments to Net
(Loss) Income Firm Transportation Exit Cost 92 — Gain on
Divestitures, Net — (588 ) Asset Impairments — 168 Loss on
Investment in Tamar Petroleum Ltd., Net — 29 Loss on Commodity
Derivative Instruments, Net of Cash Settlements 226 51 Other
Adjustments 19 18 Total Adjustments
Before Tax 337 (322 ) Current Income Tax Effect of Adjustments (1)
(3 ) 97 Deferred Income Tax Effect of Adjustments (1) (65 ) (12 )
Tax Reform Impact (2) — (145 )
Adjusted Net
(Loss) Income Attributable to Noble Energy (Non-GAAP) $ (44 )
$ 172
Net (Loss) Income Attributable
to Noble Energy Per Share, Basic and Diluted (GAAP) $ (0.65 ) $
1.14 Firm Transportation Exit Cost 0.19 — Gain on Divestitures, Net
— (1.21 ) Asset Impairments — 0.34 Loss on Investment in Tamar
Petroleum Ltd., Net — 0.06 Loss on Commodity Derivative
Instruments, Net of Cash Settlements 0.47 0.10 Other Adjustments
0.04 0.05 Current Income Tax Effect of Adjustments (1) — 0.20
Deferred Income Tax Effect of Adjustments (1) (0.14 ) (0.03 ) Tax
Reform Impact (2) — (0.30 )
Adjusted (Loss)
Income Attributable to Noble Energy per Share, Diluted
(Non-GAAP) $ (0.09 ) $ 0.35
Weighted Average Number of Shares Outstanding, Basic 478 487
Weighted Average Number of Shares Outstanding, Diluted 478 488
(1)
Amount represents the income tax effect of
adjustments, determined for each major tax jurisdiction for each
adjusting item, including the impact of timing and magnitude of
divestiture activities.
(2)
During first quarter 2018, we recorded a
$145 million tax benefit as a result of the U.S. Department of the
Treasury and the Internal Revenue Service intent to issue
additional regulatory guidance associated with Tax Reform
Legislation and the transition tax (toll tax).
Schedule 6 Noble Energy, Inc.
Reconciliation of Net (Loss) Income Including Noncontrolling
Interests (GAAP) to Adjusted EBITDAX (Non-GAAP) (in
millions, unaudited)
Adjusted Earnings Before Interest Expense, Income Taxes,
Depreciation, Depletion and Amortization, and Exploration Expenses
(Adjusted EBITDAX) (Non-GAAP) should not be considered an
alternative to, or more meaningful than, net (loss) income
including noncontrolling interests (GAAP) or any other measure as
reported in accordance with GAAP. Our management believes, and
certain investors may find, that Adjusted EBITDAX (Non-GAAP) is
beneficial in evaluating our operating and financial performance
because it eliminates the impact of certain items affecting
comparability (typically noncash and/or nonrecurring items) that
management does not consider to be indicative of our performance
from period to period. We believe these Non-GAAP measures are used
by analysts and investors to evaluate and compare our operating and
financial performance across periods. As a performance measure,
Adjusted EBITDAX (Non-GAAP) may be useful for comparison to
forecasts prepared by analysts and other third parties. However,
our presentation of Adjusted EBITDAX (Non-GAAP) may not be
comparable to similar measures of other companies in our
industry.
Three Months EndedMarch 31,
2019 2018
Net (Loss) Income Including Noncontrolling
Interests (GAAP) $ (289 ) $ 574 Adjustments to Net
(Loss) Income, After Tax (1) 269 (382 ) Depreciation, Depletion and
Amortization 508 468 Exploration Expense 24 35 Interest, Net of
Amount Capitalized 66 73 Current Income Tax Expense (2) 19 13
Deferred Income Tax Benefit (2) (35 ) 16
Adjusted
EBITDAX (Non-GAAP) $ 562 $ 797 (1)
See Reconciliation of Net (Loss) Income
Attributable to Noble Energy (GAAP) to Adjusted Net (Loss) Income
Attributable to Noble Energy (Non-GAAP).
(2)
Represents remaining Income Tax Expense
(Benefit) after reversal of Adjustments to Net (Loss) Income, After
Tax, above.
Schedule 7 Noble Energy, Inc.
Capital Expenditures (in millions, unaudited)
Three Months EndedMarch 31,
2019 2018 Organic Capital Expenditures, Attributable
to Noble Energy (Accrual Based) (1) $ 683 $ 777
Acquisition Capital Attributable to Noble Energy 39 4 Noble
Midstream Partners Capital Expenditures (2) 29 345 Investment in
Equity Method Investees (3) 271 — Increase in Finance Lease
Obligations 2 —
Total Reported Capital
Expenditures (Accrual Based) $ 1,024 $
1,126 (1)
For the three months ended March 31, 2019
and March 31, 2018, organic capital expenditures include $37
million and $110 million for midstream capital not funded by Noble
Midstream Partners LP (NBLX), respectively.
(2)
NBLX capital expenditures for the three
months ended March 31, 2018 include $206 million related to the 100
percent acquisition of Saddle Butte Rockies Midstream, LLC.
(3)
Investment in equity method investees
includes primarily NBLX investments of $227 million in EPIC
Y-Grade, LP and EPIC Crude Holdings, LP and $38 million in Delaware
Crossing LLC.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190503005074/en/
Investor Contacts
Brad Whitmarsh(281) 943-1670Brad.Whitmarsh@nblenergy.com
Park Carrere(281) 872-3208Park.Carrere@nblenergy.com
Kim Hendrix(281) 943-2197Kim.Hendrix@nblenergy.com
Media Contacts
Reba Reid(713) 412-8441media@nblenergy.com
Paula Beasley(281) 876-6133media@nblenergy.com
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