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Laredo Petroleum Announces Third-Quarter 2019 Production Results and Updates Full-Year 2019 Operating Plan
Third-Quarter 2019 Highlights
- Exceeded both oil and total production guidance for the quarter, producing 27.8 thousand barrels of oil per day ("MBOPD") and 81.9 thousand barrels of oil equivalent ("MBOE") per day
- Continued to reduce well costs through efficiencies and service cost reductions, lowering costs at the end of the quarter to
$660per lateral foot for Laredo's standard completion design
- Reduced the outstanding balance on the Company's senior secured credit facility by
$50 millionwith internally generated cash flow, lowering the balance to $185 millionat September 30, 2019
Since the announcement of Laredo's operating plan in
Driven by these improving fundamentals, production guidance for full-year 2019 has been raised to 28.1 MBOPD for oil and to 79.0 MBOE per day for total production, and anticipated cash flow in 2019 has increased by
Operating the Company's dedicated completions crew for the remainder of 2019 increases anticipated completions to 58 gross wells in 2019. Laredo now expects to invest
The additional activity in 2019 is anticipated to positively impact oil production and cash flows in 2020 and 2021. By maintaining operational momentum through 2019, the Company now expects to be cash flow positive in both 2020 and 2021 and grow oil production each year from the estimated higher updated full-year 2019 oil production base.
Laredo believes that its robust 2020 oil hedge position, covering approximately 75% of forecasted oil production at a weighted-average floor price of
"Our team is performing better than ever," stated
Additional information about Laredo may be found on its website at www.laredopetro.com.
This press release and any oral statements made regarding the subject of this release, contain forward-looking statements as defined under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, that address activities that Laredo assumes, plans, expects, believes, intends, projects, estimates or anticipates (and other similar expressions) will, should or may occur in the future are forward-looking statements. This press release and any accompanying disclosures may include or reference certain forward-looking, non-GAAP financial measures, such as free cash flow, and certain related estimates regarding future performance, results and financial position. The forward-looking statements are based on management’s current belief, based on currently available information, as to the outcome and timing of future events. General risks relating to Laredo include, but are not limited to, the decline in prices of oil, natural gas liquids and natural gas and the related impact to financial statements as a result of asset impairments and revisions to reserve estimates, the increase in service and supply costs, tariffs on steel, pipeline transportation constraints in the
Actual quantities of reserves that may be ultimately recovered from the Company's interests may differ substantially. Factors affecting ultimate recovery include the scope of the Company's ongoing drilling program, which will be directly affected by the availability of capital, decreases in oil and natural gas prices, well spacing, drilling and production costs, availability and cost of drilling services and equipment, drilling results, lease expirations, transportation constraints, regulatory approvals, negative revisions to reserve estimates and other factors, as well as actual drilling results, including geological and mechanical factors affecting recovery rates. Estimates of ultimate recovery from reserves may change significantly as development of the Company's core assets provides additional data. In addition, our production forecasts and expectations for future periods are dependent upon many assumptions, including estimates of production decline rates from existing wells and the undertaking and outcome of future drilling activity, which may be affected by significant commodity price declines or drilling cost increases. "Type curve" refers to a production profile of a well, or a particular category of wells, for a specific play and/or area. In addition, the Company’s production forecasts and expectations for future periods are dependent upon many assumptions, including estimates of production decline rates from existing wells and the undertaking and outcome of future drilling activity, which may be affected by significant commodity price declines or drilling cost increases. The actual results may vary considerably and should not be considered to represent the fair market value of the Company’s proved reserves.
1 Projected Free Cash Flow
Projected free cash flow, a non-GAAP financial measure, is calculated as estimated full-year 2019 cash flows from operating activities before changes in assets and liabilities, less cash and non-cash capital investments made during the period, excluding non-budgeted acquisitions. Management believes this is useful to investors in evaluating the operating trends in its business due to production, commodity prices, operating costs and other related factors.
Ron Hagood: (918) 858-5504 - RHagood@laredopetro.com
Source: Laredo Petroleum, Inc.