Forest Oil Completes Acquisition of the Buffalo Wallow Field
Forest Oil has completed the previously announced acquisition of a private company whose primary asset is an operated average working interest of 83% in the Buffalo Wallow Field (a prolific natural gas resource play) and approximately 33,300 gross acres primarily in Hemphill and Wheeler Counties, Texas. Forest also provides an updated 2005 guidance.
UPDATED 2005 GUIDANCE
Forest first announced its 2005 guidance on February 16, 2005. The following update is made subject to all of the cautionary statements and limitations contained in the February 16, 2005 press release. Given those statements and limitations, as well as the limitations discussed below, the following is a summary of Forest's updated guidance for 2005:
Daily Production. We estimate that our daily production will be in the range of 495 to 525 MMcfe/d for the full year of 2005.
Liquids Production. We estimate that our 2005 production of oil and natural gas liquids will be between 30,000 and 32,000 Bbls/d.
Gas Production. We estimate that our 2005 natural gas production will be between 315 and 335 MMcf/d.
Production Expense. Our oil and gas production expense (which includes ad valorem taxes, production taxes and product gathering and transportation) varies in response to several factors. Among the most significant of these factors are additions to or deletions from our property base, changes in production taxes, general changes in the prices of services and materials that are used in the operation of our properties and the amount of repair and workover activity required. We expect that our 2005 production expense will be between $235 million and $255 million.
General and Administrative Expense (G&A). We estimate that our 2005 G&A expense will be between $36 million and $41 million.
Depreciation, Depletion and Amortization (DD&A). We estimate that our DD&A rate will be between $ 2.10 and $2.20 per Mcfe during 2005.
Capital Expenditures. We estimate that expenditures for exploration and development will be between $425 million and $475 million in 2005. Some of the factors impacting the level of capital expenditures in 2005 include crude oil and natural gas prices, the volatility in these prices, the cost and availability of oil field services and weather disruptions.
- Forest Oil to Put Texas Panhandle Properties Up For Sale (Jul 15)
- Forest Oil Partners with Schlumberger on Eagle Ford Shale Land (Apr 12)
- Forest Oil to Sell South Texas Assets Excluding Eagle Ford (Jan 03)