Pioneer Natural Resources Company (PXD)

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Pioneer cuts output estimate

Pioneer Natural Resources cut its first-quarter oil production estimate citing extreme weather in the first half of February and an unplanned third-party outage.

News wires 23 March 2011 21:01 GMT

The Irving, Texas-based company now expects to produce an average of 111,000 to 113,000 barrels of oil equivalent per day, lower than its previous forecast of 114 to 118 Mboed.

The company said the extreme cold in Texas, Kansas and Colorado caused pipeline freeze-ups, power outages and limited access to well locations.

Operations recovered fully only by early this month, Pioneer said in a statement, according to a Reuters report.

The company said the outage at a third-party fractionator will lower quarterly production by about 1 Mboed.

However, the company expects production this year to increase between 15% and 19% at 125 to 130 Mboed on the back of ramped-up drilling operations in Spraberry and Eagle Ford shales.

The company now expects first-quarter production costs to rise to between $13 and $14 per barrel oil equivalent from $11.75 to $13.75 boe.

Pioneer, with a market value of $11.7 billion, said it will record a one-time gain of between $630 million and $650 million in the first quarter from the previously announced sale of its Tunisia units.

Published: 23 March 2011 21:01 GMT | Last updated: 23 March 2011 21:01 GMT