Header

Crescent Point Energy Corp's profit surged in the second quarter as production exceeded expectations and crude prices jumped, prompting the Canadian oil producer to boost spending by 25 percent to C$1 billion ($1 billion).

Oil companies are moving into Swan Hills, about 200 km (120 miles) northwest of Edmonton, to revisit old discoveries in the Beaverhill Lake formation. By using new horizontal drilling and multistage fracturing techniques, they aim to produce oil there that vertical wells could not tap.

"Nearly C$80 million of the increase will be directed towards drilling focused on our emerging Beaverhill Lake light-oil resource play in Alberta and the Flat Lake Bakken play in southeastern Saskatchewan," Scott Saxberg, the company's chief executive, said on a conference call.

"The remainder ... will be split between facilities and land investments in our core plays, including the Beaverhill Lake area."

The increase is double the C$100 million increase in spending that Crescent Point last month said it was considering.

PRODUCTION UP 20 PERCENT

Second-quarter earnings rose to C$185 million, or 68 Canadian cents a share, from C$72 million, or 33 Canadian cents, a year earlier.

The results included unrealized hedging gains of C$158 million and losses of C$37 million.

Funds from operations rose 68 percent to C$311 million, or C$1.14 a share, from C$185 million, or 84 Canadian cents a share.

Production rose 20 percent to 66,112 barrels of oil equivalent per day.

With its increase in spending, Crescent Point now expects to end the year producing 76,500 bpd, up from its previous target of 75,000.

The company's shares rose C$1.84 to C$42.15 by early afternoon on the Toronto Stock Exchange.

Source: Reuters

DiscoverWeyburn.com is Weyburn's only source for community news and information such as weather and classifieds.

Login