Cabot Oil & Gas reported second quarter earnings that highlight increased production, reduced costs and a focus on natural gas.
Related: Cabot Grabs More Eagle Ford Acreage in Oil Window
Shares of Cabot stock fell 4.4% to $26.39 on Friday after the company reported earnings of 3 cents a share for the second quarter. Revenue fell 42.6% year over year to $306.3 million, below analysts' estimates of $372.99 million. The company has no plans to change their $900 million capital campaign for 2015.
Cabot’s production increased over the second quarter of 2014 to 128.4 billion cubic feet (5% increase) of natural gas and 1.6 million barrels (68%) of crude oil.
In an earnings call, Dan O. Dinges, Chairman, CEO said the company will rely on discipline to weather the current pricing environment by focusing on improving efficiencies, reducing cost and focusing on natural gas.
“I’m not as confident as what the oil price is going to do as I am what I see available to us on the natural gas side. So with that being said, we’re focused in natural gas, we’ll remain focused in natural gas. If we have the opportunity to improve our liquids position, it’s going to have to compete with what our view is long term in natural gas.”
Eagle Ford Operations
Cabot’s drilling activity is focused on 89,000 acres in the Eagle Ford Shale, which receives about 40% of the company’s capital allocation. Here are some highlights from the second quarter:
- Net production was 17,889 barrels of oil equivalent (Boe) per day, an increase of 74 percent over the prior year's comparable quarter.
- Cash unit costs were approximately $15.00 per Bbl
- Decreased our drilling days by about 20% relative to 2014
- Increased the average number of completions per day by about 20%
- Upwards of 30% cost reductions across all service lines
- Currently operating three rigs in the Eagle Ford Shale, with plans to decrease to one rig by the end of 2015
- Plans to drill approximate 45 net wells in the Eagle Ford Shale in 2015
Read the complete press release at cabotog.com