Laredo Petroleum Announces Proved Reserves and Production for 2019
January 06 2020 - 07:21AM
Laredo Petroleum, Inc. (NYSE: LPI) ("Laredo" or "the Company")
today announced year-end reserve estimates and annual production
for 2019.
2019 Highlights
- Exceeded both oil and total production guidance for full-year
2019, producing an average of 28.4 thousand barrels of oil per day
("MBOPD") and 80.9 thousand barrels of oil equivalent per day
("MBOEPD") in full-year 2019, increases of 2% and 19% versus
full-year 2018, respectively
- Grew proved oil reserves by 17 million barrels, an increase of
27% versus year-end 2018
- Grew total proved reserves by 55 million BOE to 293 million
BOE, an increase of 23% versus year-end 2018
"The Company's strong performance in 2019 reflects the
successful implementation of our returns and Free Cash Flow1
generation focused strategy," commented Jason Pigott, President and
Chief Executive Officer. "Results in 2019 were driven by our
outstanding operational performance and improved well productivity
related to wider-spaced development. Development in 2020 will shift
to our recent Howard County acquisition, as we seek to further
improve corporate returns and Free Cash Flow1 generation through
accretive acquisitions that target oily, high-margin
inventory."
ProductionLaredo exceeded both oil and total
production guidance for the fourth consecutive quarter, with
fourth-quarter 2019 oil production of 27.3 MBOPD beating guidance
by 5% and total production of 84.0 MBOEPD beating guidance by 10%.
Results throughout the year were driven by consistent operational
efficiency gains that positively impacted cycle times and
wider-spaced well packages that averaged 16% better than the
Company's oil type curve for Upper/Middle Wolfcamp wells on
Laredo's established acreage.
ReservesThe Company grew total proved reserves
by 23%, an increase of 55 million BOE, partially driven by results
from wells developed with wider spacing versus wells developed in
2018 with tighter spacing. Additionally, Laredo has increased PUD
bookings, primarily related to the Company's recently acquired
Howard County acreage. The Company has chosen to increase PUD
bookings compared to previous years, reflecting the certainty of
the near-term development plan for the Howard County acreage.
About Laredo
Laredo Petroleum, Inc. is an independent energy company with
headquarters in Tulsa, Oklahoma. Laredo's business strategy is
focused on the acquisition, exploration and development of oil and
natural gas properties, primarily in the Permian Basin in West
Texas.
Additional information about Laredo may be found on its website
at www.laredopetro.com.
Forward-Looking Statements
This press release and any oral statements made regarding the
subject of this release, contain forward-looking statements as
defined under Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. All statements, other than statements of historical facts,
that address activities that Laredo assumes, plans, expects,
believes, intends, projects, indicates, enables, transforms,
estimates or anticipates (and other similar expressions) will,
should or may occur in the future, including, but not limited to,
the share repurchase program, which may be suspended or
discontinued by the Company at any time, are forward-looking
statements. The forward-looking statements are based on
management's current belief, based on currently available
information, as to the outcome and timing of future events.
General risks relating to Laredo include, but are not limited
to, the decline in prices of oil, natural gas liquids and natural
gas and the related impact to financial statements as a result of
asset impairments and revisions to reserve estimates, the increase
in service and supply costs, tariffs on steel, pipeline
transportation constraints in the Permian Basin, hedging
activities, possible impacts of litigation and regulations, the
suspension or discontinuance of share repurchases at any time and
other factors, including those and other risks described in its
Annual Report on Form 10-K for the year ended December 31, 2018,
Quarterly Report on Form 10-Q for the quarter ended September 30,
2019, the preliminary prospectus supplement and those set forth
from time to time in other filings with the Securities Exchange
Commission (“SEC”). These documents are available through Laredo’s
website at www.laredopetro.com under the tab “Investor Relations”
or through the SEC’s Electronic Data Gathering and Analysis
Retrieval System (“EDGAR”) at www.sec.gov. Any of these factors
could cause Laredo’s actual results and plans to differ materially
from those in the forward-looking statements. Therefore, Laredo can
give no assurance that its future results will be as estimated.
Laredo does not intend to, and disclaims any obligation to, update
or revise any forward-looking statement.
The SEC generally permits oil and natural gas companies, in
filings made with the SEC, to disclose proved reserves, which are
reserve estimates that geological and engineering data demonstrate
with reasonable certainty to be recoverable in future years from
known reservoirs under existing economic and operating conditions.
Factors affecting ultimate recovery include the scope of the
Company's ongoing drilling program, which will be directly affected
by the availability of capital, decreases in oil, NGL and natural
gas prices, well spacing, drilling and production costs,
availability and cost of drilling services and equipment, drilling
results, lease expirations, transportation constraints, regulatory
approvals, negative revisions to reserve estimates and other
factors as well as actual drilling results, including geological
and mechanical factors affecting recovery rates. Estimates of
ultimate recovery from reserves may change significantly as
development of the Company's core assets provides additional data.
In addition, our production forecasts and expectations for future
periods are dependent upon many assumptions, including estimates of
production decline rates from existing wells and the undertaking
and outcome of future drilling activity, which may be affected by
significant commodity price declines or drilling cost increases.
"Type curve" refers to a production profile of a well, or a
particular category of wells, for a specific play and/or area. In
addition, the Company's production forecasts and expectations for
future periods are dependent upon many assumptions, including
estimates of production decline rates from existing wells and the
undertaking and outcome of future drilling activity, which may be
affected by significant commodity price declines or drilling cost
increases.
1 Free Cash FlowFree Cash Flow, a non-GAAP
financial measure, is calculated as estimated cash flows from
operating activities before changes in assets and liabilities, less
estimated costs incurred, excluding non-budgeted acquisition
costs.
Contacts:Ron Hagood: (918) 858-5504 -
RHagood@laredopetro.com
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