Devon Energy Corporation has restored approximately 30,000 oil-equivalent barrels (Boe) per day of offshore oil and natural gas production in the Gulf of Mexico. Devon was producing approximately 50,000 Boe per day from its Gulf of Mexico properties prior to suspending production in preparation for Hurricanes Gustav and Ike.
As previously announced, Hurricane Ike toppled two of Devon's platforms in the Eugene Island area. As a result, offshore production of about 1,200 Boe per day will be curtailed indefinitely. Devon's remaining Gulf of Mexico production, about half of which is oil and half of which is natural gas, is expected to be restored in 2009 as third-party facilities are repaired.
Onshore, approximately 600,000 Boe of additional U.S. oil and gas production was curtailed in the third quarter as a result of Hurricane Ike. The curtailed onshore production has been restored.
Revised 2008 Production Estimates
Devon also revised its third-quarter and fourth-quarter 2008 oil and gas production forecasts. The revised quarterly forecasts reflect weather-related production curtailments and operational down time at the ACG field in Azerbaijan. Transportation interruptions and mechanical down time at the offshore Azeri platforms at ACG have required the operator to reduce production from the field pending repairs.
Devon previously forecast company-wide production for the third quarter of 2008 at approximately 61 million Boe. The company now expects third-quarter 2008 company-wide production to be approximately 59 million Boe. About two-thirds of the two million Boe reduction to third-quarter volumes is attributable to the U.S. hurricanes and to typhoons in the South China Sea. The weather-related reduced volumes are roughly 40 percent oil and 60 percent natural gas. The remaining one-third of the third-quarter forecast reduction is attributable to the ACG field, which produces only oil.
In the fourth quarter of 2008, Devon expects to produce between 61 million and 62 million Boe, depending upon the timing of repairs. This compares with a previous company-wide forecast of 64 million Boe. About two-thirds of the reduction to the fourth-quarter forecast is attributable to curtailments caused by the U.S. hurricanes. The hurricane-related reduced volumes in the fourth quarter are roughly 50 percent oil and 50 percent natural gas. The remaining one-third of the fourth-quarter forecast reduction is attributable to expected down time at ACG.
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