TORONTO (miningweekly.com) – US-based fossil fuels producer Consol Energy has revised its 2015 exploration and production (E&P) capital expenditure (capex) budget, saying it was high-grading its development plan to reduce capital in the lower commodity-price environment.
The NYSE-listed firm had forecast capex of $920-million this year, down from the $1-billion announced in January.
Consol said its revised development plan would not compromise its E&P production growth target of 30% for 2015.
Further, the company continued to drive operating costs lower through cost cutting and by implementing efficiency improvements, with the goal of keeping its year-end leverage ratio flat compared with 2014.
Excluding natural gas resource Marcellus Shale gathering capital of about $100-million, Consol expected to allocate about 52% of the remaining E&P capital budget towards dry-gas development.
Consol was retaining the flexibility to increase activity levels in the second half of 2015, if the forward trend in gas prices justified increasing output. Whether Consol increased its activity levels this year would largely determine the production growth in 2016, which the company now expected to exceed 2015 production levels by 20%.