Centennial reduces operated rigs in Reeves County to three

Denver-based Centennial Resource Development said Feb. 24 it is reducing operated rigs in Reeves County to 3 beginning in 2020Q2 with a focus on upper Wolfcamp A and third Bone Spring sand zone. Another rig will be allocated to Lea County, N.M.
Centennial is reducing its 2020 capital budget 28 percent compared to 2019. The 2020 capital budget of $590 million to $690 million will include drilling and completion costs of $490 million to $550 million with increase in crude oil production of 3 percent over 2019. Centennial said it expects to spud and complete 65-to-75 wells (gross) with average lateral length of 7,300 to 8,000 feet. Mark G. Papa, chairman and CEO, said, “Balance sheet strength is much more important than production growth. Our 2020 capital budget is a prudent decision to preserve high-quality inventory and maintain a low-leverage profile.”