Pioneer Natural Resources Forecasts 'Consistent Growth' for 2008
First quarter 2008 production for Pioneer Natural Resources is forecasted to average 103,000 BOEPD to 109,000 BOEPD. Consistent growth is expected to continue during the quarter, primarily driven by increasing production from Pioneer's core onshore areas (Spraberry, Raton, Edwards and Tunisia).
First quarter production costs (including production and ad valorem taxes and transportation costs) are expected to average $11.75 to $12.75 per BOE based on current NYMEX strip prices for oil and gas. Depreciation, depletion and amortization expense is expected to average $10.75 to $11.75 per BOE.
Total exploration and abandonment expense during the first quarter is expected to be $40 million to $70 million and could include up to $40 million associated with lower-risk resource plays in the Edwards Trend, the Rockies and Tunisia. In addition, exploration expense is expected to include up to $30 million for seismic investments and personnel, primarily related to the onshore resource plays in South Texas and Tunisia.
General and administrative expense is expected to be $32 million to $36 million. Interest expense is expected to be $35 million to $40 million. Accretion of discount on asset retirement obligations is expected to be $2 million to $3 million.
The Company's first quarter effective income tax rate is expected to range from 40% to 45% based on current capital spending plans.
First quarter 2008 amortization of deferred losses on terminated oil and gas hedges is expected to be $24 million. The Company's financial results, oil and gas hedges and future VPP amortization are outlined on the attached schedules.
The initial public offering of common units of Pioneer Southwest Energy Partners L.P. has been postponed due to market conditions, and the timing of the offering remains uncertain.
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