HOUSTON, Dec. 18, 2019 /PRNewswire/ -- Goodrich
Petroleum Corporation (NYSE American: GDP) today announced a
preliminary 2020 capital expenditure budget of $55 - $65 million,
an approximate 35% reduction from the midpoint of 2019 capital
expenditure guidance. At natural gas and oil prices of $2.50 and $55.00,
respectively, the Company expects to generate approximately
$15 – $25
million of free cash flow, which at the midpoint of guidance
would generate a free cash flow yield of approximately 9%
and 16% on the Company's current enterprise value and
market capitalization, respectively. At this price deck the
Company anticipates exiting 2020 at approximately 1.0 times debt to
EBITDA.
The Company expects to grow production by 12.5% – 17.5% versus
2019 to a range of approximately 53 – 56 Bcfe, or an average of
145,000 – 153,000 Mcfe per day for the year. Natural gas is
expected to comprise approximately 99% of total production.
The Company's capital expenditure budget currently contemplates
completing and turning in line 13 gross (5.8 net) horizontal wells
for the year, with an estimated blended net average lateral
length of approximately 8,500 feet. The budget currently
contemplates that the Company will operate 72% of its net wells
completed and turned in line for the year. The preliminary capital
expenditure budget is subject to quarterly review and approval by
the Company's board of directors, with the flexibility to
accelerate in the second half of the year depending on commodity
prices. The Company has allocated the majority of the budget to
drilling and completing core Haynesville Shale wells in the
Bethany-Longstreet area of Caddo and DeSoto Parishes, Louisiana.
Cash margin is expected to continue to expand as unit costs
decrease with the growth in volumes, and the Company is issuing a
guidance range for the following cash costs per Mcfe of production
for 2020:
|
Mcfe
|
|
|
Lease Operating
Expense ("LOE")
|
$0.20 –
0.25
|
Taxes
|
$0.05 –
0.10
|
Transportation
|
$0.25 –
0.35
|
G&A
(Cash)
|
$0.24 –
0.30
|
In addition, the Company has hedged approximately 45% - 50% of
its expected natural gas volumes for the year at a blended average
price of approximately $2.60.
OTHER INFORMATION
Certain statements in this news release regarding future
expectations and plans for future activities may be regarded as
"forward looking statements" within the meaning of the Securities
Litigation Reform Act. They are subject to various risks,
such as financial market conditions, changes in commodities prices
and costs of drilling and completion, operating hazards, drilling
risks, and the inherent uncertainties in interpreting engineering
data relating to underground accumulations of oil and gas, as well
as other risks discussed in detail in the Company's Annual Report
on Form 10-K for the year ended December 31,
2018 and other subsequent filings with the Securities and
Exchange Commission. Although the Company believes that the
expectations reflected in such forward looking statements are
reasonable, it can give no assurance that such expectations will
prove to be correct.
Goodrich Petroleum is an independent oil and natural gas
exploration and production company listed on the NYSE American
under the symbol "GDP".
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SOURCE Goodrich Petroleum Corporation