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Petroleum

Independent Producers Weather Low Oil Prices with Gas Productions

Strategic Insights

— 1 min read

As the global oil market grappled with plummeting crude prices, many independent producers showed surprising resilience, thanks largely to their strategic acquisitions of gas-producing properties and increasing gas production. Notably, Anadarko Petroleum Corp. and Louisiana Land & Exploration Co. (LL&E) reported impressive first-quarter earnings, while Maxus Energy Corp. struggled with production curtailments and delays in oil production. Despite the initial setbacks, independent producers seem to be adapting well to the current low oil price environment.

Key Takeaways:

  • Anadarko Petroleum Corp. would have posted a 12% increase in first-quarter earnings to $17.1 million (29 cents/share) from $15.3 million (28 cents/share), excluding a one-time gain from accounting changes.
  • Louisiana Land & Exploration Co. (LL&E) doubled its first-quarter earnings to $6.2 million (19 cents/share) from $2.9 million (10 cents/share) for the same period last year, driven by higher oil and gas production.
  • Maxus Energy Corp. saw its first-quarter losses triple to $11.2 million (17 cents/share) due to costly production curtailments in Indonesia and delays in oil production in Ecuador.
  • Anadarko's domestic natural gas prices rose more than 18% to an average $2.38/Mcf, while worldwide crude prices fell 25%, or nearly $4.50, to $13.46/bbl.
  • LL&E benefited from higher oil and gas production resulting from several acquisitions made last year, with domestic natural gas prices increasing by more than 18%.
  • Maxus Energy's production delays and low oil prices were partially offset by higher natural gas prices and additional gas sales.

Statistics:

  • Anadarko Petroleum Corp. first-quarter earnings: $17.1 million (29 cents/share)
  • Louisiana Land & Exploration Co. (LL&E) first-quarter earnings: $6.2 million (19 cents/share)
  • Maxus Energy Corp. first-quarter losses: $11.2 million (17 cents/share)
  • Anadarko's domestic natural gas prices: $2.38/Mcf, up 18% from the previous quarter
  • Worldwide crude prices: $13.46/bbl, down 25% from the previous quarter

Sources:

  • "Anadarko Petroleum Corp." (name of report/research not specified)
  • "Louisiana Land & Exploration Co. (LL&E)" (name of report/research not specified)
  • "Maxus Energy Corp." (name of report/research not specified)

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