W&T Offshore Positions Itself to Prosper in 2010
W&T Offshore has provided an update on its 2009 drilling activities, 2009 production guidance as well as 2010 planned capital expenditures.
For full year 2009, the Company has made discoveries and successfully completed seven of nine exploration wells, for a success rate of 78%, which included a 100% success rate on the conventional shelf. Additionally, the Company successfully drilled and completed two of three development wells, all of which were on the conventional shelf. For the 13 wells drilled in 2009, the Company achieved a success rate of 75%. Furthermore, at year-end 2009 we were in the early stages of drilling one exploration well. Also during 2009, the Company successfully completed and brought online our Daniel Boone prospect (Green Canyon 646) in the deepwater Gulf of Mexico.
2010 Capital Expenditure Guidance: W&T Offshore's total capital expenditure budget for 2010 is expected to be approximately $450 million. The Company anticipates fully funding its 2010 capital budget with internally generated cash flow and cash on hand. Currently, the budget includes seven conventional shelf exploration wells. It also includes other capital items such as well recompletions, facilities capital, seismic and leasehold items. At this time, the Company anticipates these capital expenditures to cost approximately $150 million. The balance of the $450 million budget will be allocated to acquisitions, additional drilling opportunities from the Company's prospect inventory and/or new joint ventures offshore on the shelf and deepwater and onshore. WTI is determined to remain as flexible as possible and believes this strategy holds the best promise for value creation and growth.
Production: W&T Offshore expects to meet its fourth quarter production guidance for 2009 of between 21.9 Bcfe and 26.8 Bcfe and our full-year production guidance of between 93.8 Bcfe and 98.7 Bcfe. At year-end, the Company's production rate was approximately 232 MMcfe per day. During 2009, the Company focused on increasing oil production and for the month of December, our oil and liquids production as a percentage of total production was approximately 47%.
Tracy W. Krohn, Chairman and Chief Executive Officer, stated, "The Company is well positioned to prosper in 2010 in these market conditions. We will aggressively pursue additional opportunities in the form of acquisitions and joint venture participations, which is consistent with our historical practice. What is different in 2010 is the organizational effort that has been formulated to achieve our corporate goals. We have recently relocated exploration geology to Houston from Metairie, Louisiana and will be adding staff to focus our efforts on both onshore and offshore. Similarly, we are adding staff to increase our M&A effort as well. One of the reasons we went public was to access public capital markets, but also to elevate our visibility to pursue merger and acquisition opportunities."
Operates 2 Offshore Rigs
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