Newfield Exploration, an oil and gas production company based in The Woodlands, cut expenses, boosted Oklahoma drilling and turned losses into profits last quarter.
The company made a $48 million profit in the third quarter, or 24 cents per share, its first quarterly profit since 2014, Newfield said in its earnings call on Wednesday. Over the same period last year, the company lost more than $1.2 billion, or $7.52 per share.
Since the crash in oil prices two years ago, Newfield has consolidated offices, cut its workforce by 30 percent or 400 employees, and sold “non-strategic” assets, such as acreage in South Texas’s Eagle Ford oilfield, chairman and chief executive Lee Boothby told analysts.
At the same time, Newfield has raised oil and gas production each quarter this year. It thinks it will beat 2016 estimates by 3.5 million barrels of oil equivalent or 7 percent by year’s end.
Revenues in the third quarter increased by $15 million or 4 percent to $392 million.
The company’s acreage in Oklahoma’s SCOOP and STACK oilfields — which it added to in the third quarter — were primarily responsible for the uptick, Boothby said. Newfield boosted its capital expense budget to $750 million for the year and said it will add drilling rigs in the Anadarko Basin there, which stretches from western Oklahoma into eastern Texas.
Neither the SCOOP nor the STACK require higher oil prices to be money-makers, Boothby said, and the company can quickly pull rigs back if prices fall.
Newfield, however, has a hole to dig out of this year. Losses reported so far this year have shrunk by more than half when compared to last year, but still stand at $1.2 billion.