HOUSTON — Pioneer Natural Resources said late Tuesday it lost $218 million in the second quarter but still expects its crude production to increase 10 percent this year.
The Irving-based firm was the latest example of a U.S. oil producer declaring it will bolster the amount of oil it puts out even in the face of an oil-market slump that has forced drillers to send hundreds of rigs out of the oil patch.
“We are putting rigs back to work and plan to return to an activity level during 2016 that can result in a similar growth trajectory that we were delivering in the second half of 2014 before the downturn,” Pioneer CEO Scott Sheffield said in a written statement.
The company said it put two additional rigs in the Spraberry/Wolfcamp region in July and will continue to add an average of two rigs a month and bring 100 new wells into production during the rest of the year. It said it’ll add 8 more rigs in the first quarter of 2016.
It’s all because oil field service costs have come down dramatically. Drilling costs have come down 20 to 25 percent and are expected to fall by 30 percent by early 2016. The company expects its oil production will grow 20 percent annually from 2016 to 2018.
Pioneer’s second-quarter loss of $1.46 a share came down from a profit of $1 million, or 1 cent a share, in the same April-June period last year. Revenues fell from $932 million to $648 million.
In the second quarter, lower-than-expected production in South Texas’ Eagle Ford Shale and in the Texas Panhandle was offset by its increase in West Texas, where it is one of the largest oil producers in the Spraberry and Wolfcamp fields. Pioneer believes it can increase production 24 percent in those two fields this year.
Executives for Occidental Petroleum Corp., Hess Corp. and Noble Energy Corp. have all made similar comments in recent days, touting an ability to bring on crude output despite the downturn, as costs continue to decline.