Irving-based ExxonMobil said April 7 it expects capital expenses for 2020 to be $23 billion – down about 30 percent from previously announced $33 billion. Exxon said, “The largest share of the capital spending reduction will be in the Permian Basin, where short-cycle investments can be more readily adjusted to respond to market conditions while preserving value over the long term. Reduced activity will affect the pace of drilling and well completions until market conditions improve.”
Other recent 2020 budget amendments for Permian operators include:
Marathon Oil of Houston said April 8 it will slash capital spending in 2020 to about half of what it was last year. Capex now for 2020 will be about $1.3 billion – down about $1.1 billion from original plans. Marathon said it plans to suspend further drilling in northern Delaware Basin, halt activities in Oklahoma, and reduce drilling and completions in Bakken and Eagle Ford in second half of 2020.
PDC Energy of Denver, Colo., said this week it plans to reduce 2020 capital investments to $500-to-$600 million, a 50 percent decrease compared to its original budget. In the Delaware Basin, PDC plans to release its drilling rig in May, “resulting in zero drilling and completion activity in the basin for the remainder of the year.” PDC released its completion crew in March.
Tenaris of Houston, manufacturer of steel pipe, said this week it is suspending operations at four U.S. plants, including Baytown, “as demand for its products falls during the oil crash.”