Devon Energy Corp. CEO Larry Nichols said Wednesday the company is reducing its natural gas drilling in the short-term until gas prices start to rebound. “We see absolutely no reason to continue to drill at this time and bring natural gas production on at this time, any more than we need to,” Nichols said at the company’s annual shareholders meeting. “It’s better to leave that gas in the ground and sell it next year, or in future years, when we can generate a greater profit for our shareholders.”
Devon has reduced its exploration and development capital budget to between $3.5 billion and $4.1 billion this year from $8.5 billion in 2008. Nichols said that 2009 continues to be a challenging year for the industry but that the largest U.S. independent oil and natural gas producer is well-placed to weather the economic downturn.
“While last year was a great year, this year is a tough year,” Nichols said, citing a steep decline in oil and natural gas prices during the second half of 2008.
Oil prices have doubled since March with some signs that the worst of the recession may be over and were hovering around $66 a barrel Wednesday afternoon on the New York Mercantile Exchange. Natural gas for June delivery tumbled 36.2 cents to $3.758 per 1,000 cubic feet after peaking last summer at $13.69 per 1,000 cubic feet.
Nichols said that natural gas prices will take longer to recover than will oil prices because of the current oversupply of natural gas.
-- Associated Press
FWCanDo Chief, Don Young says, "When will the Star-Telegram report on the TCEQ report that supports the study by Dr. Al Armendariz? I expected to see it on the front page a week ago. Instead, all we get are business reports from the industry that has caused the ozone doubling in the BS.
What about public health and safety and the environment? Aren't they part of the Barnett Shale news, too?"
Posted by: Don Young | June 03, 2009 at 02:59 PM
http://www.star-telegram.com/news/story/1413456.html
Posted by: BC | June 11, 2009 at 10:55 PM
what a gut less author
Posted by: DRILL BIT | June 13, 2009 at 09:37 AM
Don,
You people want your cake and eat it too.
You’ll take their money, then whine about it afterwards.
You are an embarrassment to Fort Worth & Texas.
I wish you’d take your “Obama mindset” and move to Moscow or Paris, both being equally depraved. You & your kind should feel very home in either location & Fort Worth would be so much better off.
You and your kind are about as newsworthy as a dust devil on the planes. A momentary irritant at best.
David Petrasek, Fort Worth, Texas
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Posted by: too lazy to look up old name | July 11, 2009 at 09:57 PM
Occidental just discovered a major oil field in California. It's there if govt allows for the searching and drilling of new oil.
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