Berry Petroleum Announces Strong Production Growth and Re-Affirms 2019 Annual Production Guidance
October 07 2019 - 4:32PM
Berry Petroleum Corporation (NASDAQ: BRY) (“Berry” or the
“Company”) announced today preliminary third quarter
production results in line with its full-year production guidance.
In addition, the company is continuing its commitment to returning
value to shareholders through its fixed dividend and share buy-back
policies.
Third Quarter 2019 Production Highlights
- Third quarter production of 29,600 boe/d up 7.7% compared to
last quarter
- Third quarter September exit rate up 15.8% compared to the June
exit rate
- California production of 22,900 bbl/day for the quarter up more
than 10.4% compared to last quarter and 17.7% year-over-year
- Layered on additional 2019, 2020 and 2021 oil hedges making our
oil production coverage more than 60% for the remainder of 2019 and
more than 50% for 2020
- No changes to annual guidance for production or capital
spending
“The production growth we have seen in the third quarter is in
line with our plan and validates the potential of our quality
assets. Our production performance reinforces our confidence that
our fields respond to capital and have a long future of manageable,
high-returning, low-risk oil production growth, with a well
inventory that we believe is at least 20 years,” said Trem Smith,
Berry’s chairman of the board and CEO. “Berry’s management team’s
focus since 2017 has been on creating and delivering shareholder
value. Berry is committed to protecting the base, growing
production at a deliberate long-term rate, returning capital to our
shareholders, and doing it all out of levered free cash flow
throughout the cycle.”
Production Update
Berry’s third quarter production growth is in line with the plan
and prior quarterly statements. This growth also highlights Berry’s
strong capital efficiency with a 7.9% and 17.7% increase in
production compared to the third quarter of 2018 for the Company
and California, respectively. The monthly production exit rate for
the Company’s third quarter was 15.8% higher in September than the
June exit rate for the prior quarter.
Preliminary total Company production for the third quarter ended
September 30, 2019 averaged 29,600 boe/d with the month of
September averaging 31,700 boe/d, compared to June’s average of
27,400. The month of September production is nearly 88% oil, an
increase from 86% in the second quarter of 2019.
This improvement is primarily attributed to Berry’s capital
deployment to grow its California production. Preliminary
California production, consisting of 100% Brent-based oil, for the
quarter is approximately 22,900 bbl/d, an increase of 10.4%
compared with last quarter and 17.7% with the third quarter
2018.
Berry also increased its hedge position as highlighted in the
table below.
|
|
|
|
Barrels per day of Brent ¹ |
Previously Disclosed Amounts |
Current Amounts |
Average Price ² |
4th quarter 2019 |
15,000 |
18,000 |
$70.20 |
Fiscal year 2020 |
12,000 |
16,000 |
$64.26 |
Fiscal year 2021 |
— |
2,000 |
$58.50 |
¹ Does not
include 1,000 barrels of WTI hedged at $61.75 through April
2020. |
² Average
Price only in reference to “Current Amounts”. |
|
Full-year production and capital spending for 2019 are expected
to be at the mid-point of Berry’s original guidance of 28,000 to
31,000 boe/day and $195 million to $225 million, respectively.
Return of Capital
Berry’s business model is designed to create and deliver value
to its shareholders. The company has several different levers it
can utilize, including fixed dividends and share buybacks, to
deliver on this promise. Since going public last July, Berry has
delivered $47 million in dividends and repurchased $39 million in
shares.
Berry continues to create value for shareholders through the
efficient management of operations, and deploying and returning
capital. The Company continues to focus on accretive
acquisitions that work with its financial policy.
About Berry Petroleum
Berry Petroleum Corporation is a publicly-traded (NASDAQ:BRY)
western United States independent upstream energy company with a
focus on the conventional, long-lived oil reserves in the San
Joaquin basin of California. More information can be found at the
Company’s website at www.berrypetroleum.com.
Forward-Looking Statements
The information in this press release includes forward-looking
statements that involve risks and uncertainties that could
materially affect our expected results of operations, liquidity,
cash flows and business prospects. Such statements specifically
include our expectations as to our future:
- financial position,
- liquidity,
- cash flows,
- results of operations and business strategy,
- potential acquisition opportunities,
- production and other plans and objectives for operations,
- maintenance capital requirements,
- expected production and costs,
- reserves,
- hedging activities,
- return of capital,
- capital investments and other guidance.
Actual results may differ from expectations, sometimes
materially, and reported results should not be considered an
indication of future performance. Factors (but not all the factors)
that could cause results to differ include:
- volatility of oil, natural gas and natural gas liquids (NGL)
prices;
- our ability to obtain permits and otherwise to meet our
proposed drilling schedule and to successfully drill wells that
produce oil and natural gas in commercially viable quantities;
- price and availability of natural gas;
- changes in laws or regulations;
- our ability to use derivative instruments to manage commodity
price risk;
- the impact of environmental, health and safety, and other
governmental regulations, and of current or pending or future
legislation;
- uncertainties associated with estimating proved reserves and
related future cash flows;
- our ability to replace our reserves through exploration and
development activities;
- timely and available drilling and completion equipment and crew
availability and access to necessary resources for drilling,
completing and operating well;
- our ability to make acquisitions and successfully integrate any
acquired businesses; and
- other material risks that appear in the Risk Factors section of
the prospectus filed with the SEC in connection with our initial
public offering.
You can typically identify forward-looking statements by words
such as aim, anticipate, achievable, believe, continue, could,
estimate, expect, forecast, goal, guidance, intend, likely, may,
might, objective, outlook, plan, potential, predict, project, seek,
should, target, will or would and other similar words that reflect
the prospective nature of events or outcomes. We undertake no
responsibility to publicly release the result of any revision of
our forward-looking statements after the date they are made.
Contact
Contact: Berry Petroleum Corporation
Todd Crabtree - Manager, Investor Relations
(661) 616-3811
ir@bry.com
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