Noble Energy, Inc. (NYSE:NBL) (“Noble Energy” or “the Company”)
announced today a third quarter 2015 net loss of $283 million, or
$0.67 per diluted share. Excluding the impact of certain
items which would typically not be considered by analysts in
published earnings estimates, third quarter 2015 adjusted loss(1)
was $90 million, or $0.21 per diluted share. Included in the
Company’s third quarter adjusted loss(1) was tax expense of $8
million, with a current tax benefit offset by a deferred tax
expense. Results from the Company’s value change in commodity
positions, exploration results, and forecasts for full year tax
projections, amongst other factors, affected tax expense for the
quarter.
Total sales volumes for the quarter averaged 379 thousand
barrels of oil equivalent per day (MBoe/d), with liquids comprising
44 percent (30 percent crude oil and condensate and 14 percent
natural gas liquids) and natural gas the remaining 56
percent. Included in sales volumes for the third quarter of
2015 were the Eagle Ford Shale and Permian assets following the
July 20th closing of the Rosetta Resources transaction.
Legacy Noble Energy volumes totaled 337 MBoe/d for the quarter, an
increase of 12 percent versus the comparable third quarter 2014
amount. Higher legacy volumes were driven by record sales
from the Company’s DJ Basin, Marcellus Shale and Israel assets.
Total sales volumes for the third quarter of 2015 were less
than production by four thousand barrels per day (MBbl/d) due to
the timing of liquid liftings in Equatorial Guinea.
David L. Stover, Noble Energy’s Chairman, President and CEO,
commented, “Noble Energy delivered tremendous performance in the
third quarter. This was highlighted by material reductions in
our quarterly capital and controllable unit costs, which were
driven by continued operational efficiency gains throughout the
business. Production outperformed expectations once again,
setting us up to operate within cash flow. Integration of the
new Eagle Ford and Delaware assets is proceeding very well, and we
have already experienced improved results by leveraging our
expertise in other premier U.S. onshore basins. Offshore, our
major project execution capabilities are once again delivering
significant value, as we recently commenced production on both Big
Bend and Dantzler in the Gulf of Mexico, ahead of schedule and on
budget. Given our exceptional portfolio, we have substantial
investment flexibility, and we are exiting the year with great
operational momentum and strong financial liquidity.”
Third quarter 2015 total production costs, including lease
operating expense (LOE), production taxes, and transportation and
gathering declined to $6.74 per barrel of oil equivalent (BOE), a
reduction of 14 percent versus the second quarter of 2015 and the
third quarter of 2014. LOE was reduced to $3.81 per BOE in
the third quarter of 2015, a decline of approximately 20 percent
from the second quarter of this year and the third quarter of last
year. Quarterly LOE per BOE is the lowest it has been over
the last five years. The lower LOE rate has resulted from
focused cost reduction and efficiency initiatives, supplier pricing
negotiations, as well as the portfolio mix of production.
General and administrative costs were $109 million, a reduction of
more than $20 million versus the same quarter of last year.
Realized gains on commodity derivatives, including crude oil,
natural gas and natural gas liquids (NGL) hedges, were $284 million
for the quarter.
Adjustments to the net loss for the third quarter of 2015
included non-cash commodity derivative losses of $17 million, as a
result of the value change of the Company’s existing hedge
positions as of the end of the quarter. The Company also
adjusted from earnings certain costs associated with the
termination of the Company’s defined benefit pension program ($67
million), costs incurred as part of the merger with Rosetta
Resources ($71 million), and various other items ($22 million).
OPERATIONS UPDATE
DJ BASINIn the DJ Basin, sales volumes averaged
a record 116 MBoe/d in the third quarter of 2015, up 13 percent
versus the third quarter of last year. Liquids made up 67
percent of total DJ Basin volumes (50 percent crude oil and
condensate and 17 percent NGLs) and 33 percent was natural
gas. Total liquid volumes of 78 MBbl/d for the quarter was a
record for Noble Energy.
Highlights include:
- Natural gas processing capacity on the DCP system, following
the start-up of the Lucerne-2 gas processing plant, increased to
more than 800 million cubic feet of natural gas per day.
Accordingly, line pressures in the northern part of the field,
particularly in and around the Company’s Wells Ranch area, have
been reduced by up to 100 psi. Construction of a third-party
low-pressure line-loop system (DCP Grand Parkway) in the northern
part of the field continues and is expected to be complete by the
end of 2015 / early 2016.
- As a result of the reduction in field line pressures, the
Company’s legacy vertical well production averaged nearly 25 MBoe/d
in the third quarter, which is a high point over the last year and
an increase of more than five MBoe/d versus pre-Lucerne-2
rates. Horizontal sales volumes totaled 91 MBoe/d, above
expectations and an increase of 23 percent from the same quarter of
last year.
- Operated four drilling rigs in the Basin for the majority of
the third quarter of 2015. Accelerated cycle times are
resulting in higher than originally planned 2015 well counts (spud,
total depth, and wells on production). Noble Energy is
currently operating three drilling rigs and two full time
completion crews in the DJ Basin.
- Drilled 39 wells at an average lateral length of over 7,300
feet. The average spud to rig release time for a standard
lateral length well (4,500 lateral feet) decreased to 5.7
days.
- Standard lateral length well costs, including allocated
facility costs, are on track to be below second half 2015 targets
of $3.5 million in Wells Ranch and $3.9 million in East Pony.
- Commenced production on 58 wells (equivalent to 70 standard
lateral length wells). Well performance in both Wells Ranch
and East Pony continues in-line with or above expectations.
Wells Ranch volumes in the third quarter were up more than 15
percent and East Pony volumes were up more than 20 percent versus
the second quarter of 2015.
- Refined completion techniques continue to enhance overall
productivity. Included in the wells brought online during the
quarter was a development area with 13 wells in Wells Ranch,
including nine wells completed with slickwater fluid and four wells
completed with hybrid gel systems. Cumulative production from
the slickwater completions is outperforming the hybrid gel wells by
more than 20 percent on average after 30 days. For a standard
lateral length well, those designed with slickwater are
approximately 10 percent lower total well cost versus hybrid gel
wells.
- Based on the current drilling and completion activity plans,
the Company estimates exiting 2015 with approximately 40 wells
drilled but uncompleted.
TEXAS (EAGLE FORD AND PERMIAN)Production
volumes for the Eagle Ford and Permian assets averaged 54 MBoe/d
from July 21 to the end of the third quarter of 2015 (which is
equivalent to 42 MBoe/d on average for the full quarter).
Approximately 84 percent of the volumes were from the Eagle Ford
assets and 16 percent were contributed from the Permian.
Liquids represented 63 percent of total volumes (crude oil and
condensate represented 29 percent and NGLs were 34 percent), while
natural gas accounted for 37 percent.
Highlights since closing the merger include:
- Drilled eight operated wells to total depth, including seven
Lower Eagle Ford wells and one Wolfcamp A well in the Delaware
Basin (Permian).
- Realized a substantial reduction in the spud to rig release
timing in both areas as a result of various operational
enhancements. In the Eagle Ford, spud to rig release times
have been reduced to approximately eight days for a 5,000 foot
lateral, down approximately 30 percent from prior 2015 activity on
these assets. The well drilled in the Delaware had a lateral
length of approximately 5,000 feet and was drilled in approximately
10 days less time than prior activity on these assets.
- Commenced production on five operated Lower Eagle Ford
wells. The two most recent wells represent Noble Energy’s
initial designed and executed completions. These wells were
drilled with 950 foot effective lateral spacing and were completed
with 20 foot cluster spacing and approximately 2,000 pounds of
proppant per lateral foot. Each of the two wells, normalized
to a 5,000 foot lateral length, is materially outperforming the 3
MMBoe estimated ultimate recovery type curve for the area.
- Based on the current drilling and completion activity plans,
the Company estimates exiting 2015 with approximately 50 wells
drilled but uncompleted (including 35 wells in the Eagle Ford and
15 wells in the Delaware). Noble Energy anticipates exiting
2015 with two rigs operating in Texas, one in the Eagle Ford and
one in the Delaware Basin.
MARCELLUS SHALEProduction volumes in the
Marcellus Shale averaged a record 493 million cubic feet of natural
gas equivalent per day (MMcfe/d), which represents a more than 50
percent increase versus the same quarter of last year.
Natural gas represented 81 percent of third quarter 2015 volumes,
with the remaining 19 percent being condensate and NGLs.
Highlights include:
- Reduced current operated and non-operated drilling activity to
zero rigs.
- Commenced production on 16 operated wells having an average
lateral length of nearly 8,000 feet. Included in the wells
brought online was the six-well RHL-4 pad located in the
Majorsville area (Marshall County, West Virginia). Three of
the wells were completed with reduced stage and cluster spacing,
and all of the wells are laterally spaced 500 feet apart.
After 30 days online, the RHL-4 pad, which averaged more than 2,200
pounds of proppant per lateral foot, was producing more than 60
MMcfe/d.
- Completed the Company’s initial Utica well, the MND-6H, with a
lateral length of 9,090 feet. The well, located in Marshall
County, West Virginia, is anticipated to commence production in the
fourth quarter of 2015.
- JV partner CONSOL Energy commenced production on 12 dry gas
wells.
- Successful completion of the initial phase of de-bottlenecking
of the dry gas North Nineveh gathering system (owned by CONE
Midstream) added approximately 100 MMcf/d of throughput capacity
and supported the Company’s quarterly volumes.
- Based on the current drilling and completion activity plans,
the Company estimates exiting 2015 with approximately 80 wells
drilled but uncompleted (including both the wet and dry gas
areas).
GULF OF MEXICOIn the Gulf of Mexico, sales
volumes averaged 12 MBoe/d, which were comprised of 82 percent
crude oil and condensate, five percent NGLs, and 13 percent natural
gas.
Highlights include:
- Delivery of the Rio Grande major project (including the Big
Bend and Dantzler fields) has been executed ahead of schedule and
within sanction budget. First oil production at the Big Bend
field commenced in late October. Maximum peak production from
the field of over 20 MBoe/d gross (10 MBoe/d net to Noble Energy)
is anticipated to be reached within the next couple of weeks.
Noble Energy operates Big Bend with a 54 percent working
interest.
- First oil production from Dantzler, anticipated to produce at a
maximum rate of over 25 MBoe/d gross (10 MBoe/d net to Noble
Energy), has also recently commenced. Noble Energy operates
Dantzler with a 45 percent working interest. Crude oil and
condensate comprise more than 85 percent of the planned production
from Rio Grande.
- Successfully sidetracked the second development well at
Gunflint and commenced completion operations in the field.
Installation of pipelines and umbilicals is currently underway,
with first production from the field projected in mid-2016 as a
tieback to the Gulfstar One facility.
WEST AFRICAHydrocarbon sales in Equatorial
Guinea averaged 73 MBoe/d, comprised of 40 percent crude oil and
condensate, eight percent NGLs, and 52 percent natural gas.
Sales volumes for the quarter were less than production volumes by
approximately four MBbl/d as a result of the timing of liquids
liftings primarily at the Alen field.
Highlights include:
- Active production management, facility optimization, and strong
reservoir performance resulted in gross daily production averages
of over 33 MBbl/d for Aseng and 30 MBbl/d for Alen.
- Successfully commenced production on the C-21 development well
at Alba ahead of schedule.
- Project status on the Alba compression project was advanced to
approximately 80 percent complete. Installation of the new
compression platform is expected to commence in the first quarter
of 2016, which will result in temporary full field shut-in.
First production from the compression facility, which will
ultimately help stem decline and extend life of field recovery, is
anticipated in the middle of 2016.
- The Cheetah exploration well, drilled in the Tilapia license
offshore Cameroon, reached total depth and did not encounter
commercial reservoir sands.
EASTERN MEDITERRANEANIn the Eastern
Mediterranean, Israel natural gas sales volumes averaged 303
MMcfe/d, an increase of 15 percent versus the third quarter of last
year. Strong seasonal weather demand and excellent reservoir
and facility performance resulted in the record quarterly
volumes.
Highlights include:
- During the month of August, the Tamar field averaged more than
1 billion cubic feet per day of natural gas production, gross.
- Negotiation of natural gas sales contracts for Tamar and
Leviathan volumes continued with multiple regional customers.
- A comprehensive regulatory framework for hydrocarbon
development was finalized and fully approved by the government of
Israel. Government action to follow through with the
regulatory framework is ongoing.
OTHER
- Extended the Company’s unsecured credit facility by two years,
to a maturity date of August 2020, with a lower pricing grid and no
changes to associated financial covenants.
- Exited the third quarter of 2015 with $5 billion in financial
liquidity, including $1 billion in cash and $4 billion of unused
credit facility capacity.
- Completed a $1.8 billion debt exchange offer by issuing an
equivalent aggregate principal amount of investment grade-rated
Noble Energy Senior Notes in exchange for validly tendered and
accepted Rosetta Resources Inc. Notes. Following the debt
exchange, both credit rating agencies affirmed their investment
grade ratings and outlooks on Noble Energy credit.
- The Humpback exploration well, drilled in the Company’s
Southern Basin acreage offshore the Falkland Islands, reached total
depth in late-October, and is being plugged and abandoned.
GUIDANCEYear-to date, organic capital
expenditures total $2.3 billion through September 30, 2015.
Total Company capital spend in 2015 has been reduced to slightly
below $3 billion, including capital allocated to Noble Energy
legacy assets plus capital associated with the Eagle Ford/Delaware
assets (post the closing of the Rosetta Resources Inc.
merger). The updated combined capital amount for 2015 is down
approximately $100 million from previous estimates. Fourth
quarter 2015 sales volume expectations have been increased to range
between 385 and 405 MBoe/d. Other updated fourth quarter 2015
guidance is provided in the Company’s supplemental quarterly
slides.
(1) A Non-GAAP measure, see attached Reconciliation
Schedules.
WEBCAST AND CONFERENCE CALL
INFORMATION
Noble Energy, Inc. will host a webcast and
conference call at 9:00 a.m. Central time today. The webcast
is accessible on the ‘Investors’ page at
www.nobleenergyinc.com. Conference call numbers for
participation are 800-753-9188 and 719-325-2247. The pass code
number is 9059257. A replay will be available on the
website.
Noble Energy (NYSE:NBL) is a global independent oil and natural
gas exploration and production company, with total proved reserves
of 1.7 billion barrels of oil equivalent at year-end 2014 (pro
forma for the Rosetta acquisition). The Company’s diverse resource
base includes positions in four premier unconventional U.S. onshore
plays - the DJ Basin, Eagle Ford Shale, Delaware Basin and
Marcellus Shale - and offshore in the U.S. Gulf of Mexico, Eastern
Mediterranean and West Africa. Driven by its purpose, Energizing
the World, Bettering People’s Lives®, the Company is committed to
safely and responsibly providing energy to the world while
positively impacting the lives of our stakeholders. For more
information, visit www.nobleenergyinc.com.
This news release contains certain “forward-looking statements”
within the meaning of federal securities law. Words such as
“anticipates”, “believes”, “expects”, “intends”, “will”, “should”,
“may”, “estimates”, and similar expressions may be used to identify
forward-looking statements. Forward-looking statements are
not statements of historical fact and reflect Noble Energy’s
current views about future events. They include estimates of
oil and natural gas reserves, estimates of future production,
assumptions regarding future oil and natural gas pricing, planned
drilling activity, future results of operations, projected cash
flow and liquidity, business strategy and other plans and
objectives for future operations. No assurances can be given
that the forward-looking statements contained in this news release
will occur as projected and actual results may differ materially
from those projected. Forward-looking statements are based on
current expectations, estimates and assumptions that involve a
number of risks and uncertainties that could cause actual results
to differ materially from those projected. These risks
include, without limitation, the volatility in commodity prices for
crude oil and natural gas, the presence or recoverability of
estimated reserves, the ability to replace reserves, environmental
risks, drilling and operating risks, exploration and development
risks, competition, government regulation or other actions, the
ability of management to execute its plans to meet its goals and
other risks inherent in Noble Energy’s business that are discussed
in its most recent annual report on Form 10-K and in other reports
on file with the Securities and Exchange Commission (“SEC”). These
reports are also available from Noble Energy’s offices or website,
http://www.nobleenergyinc.com. Forward-looking statements are
based on the estimates and opinions of management at the time the
statements are made. Noble Energy does not assume any
obligation to update forward-looking statements should
circumstances, management’s estimates, or opinions change.
The SEC requires oil and gas companies, in their filings with
the SEC, to disclose proved reserves that a company has
demonstrated by actual production or conclusive formation tests to
be economically and legally producible under existing economic and
operating conditions. The SEC permits the optional disclosure of
probable and possible reserves, however, we have not disclosed the
Company’s probable and possible reserves in our filings with the
SEC. We use certain terms in this news release, such as “estimated
ultimate recovery” which are by their nature more speculative than
estimates of proved, probable and possible reserves and accordingly
are subject to substantially greater risk of being actually
realized. The SEC guidelines strictly prohibit us from including
these estimates in filings with the SEC. Investors are urged to
consider closely the disclosures and risk factors in our most
recent annual report on Form 10-K and in other reports on file with
the SEC, available from Noble Energy’s offices or website,
http://www.nobleenergyinc.com.
This news release also contains certain historical non-GAAP
measures of financial performance that management believes are good
tools for internal use and the investment community in evaluating
Noble Energy’s overall financial performance. These non-GAAP
measures are broadly used to value and compare companies in the
crude oil and natural gas industry. Please see the attached
schedules for reconciliations of the differences between any
historical non-GAAP measures used in this news release and the most
directly comparable GAAP financial measures.
Schedule 1 |
Noble Energy, Inc. |
Summary Statement of Operations |
(in millions, except per share amounts,
unaudited) |
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2015 |
|
2014 |
|
2015 |
|
2014 |
Revenues |
|
|
|
|
|
|
|
|
Crude oil and condensate |
|
$ |
438 |
|
|
$ |
849 |
|
|
$ |
1,352 |
|
|
$ |
2,748 |
|
Natural gas |
|
293 |
|
|
310 |
|
|
785 |
|
|
932 |
|
Natural gas liquids |
|
34 |
|
|
69 |
|
|
90 |
|
|
213 |
|
Income from equity method
investees |
|
36 |
|
|
41 |
|
|
60 |
|
|
138 |
|
Total revenues |
|
801 |
|
|
1,269 |
|
|
2,287 |
|
|
4,031 |
|
Operating
Expenses |
|
|
|
|
|
|
|
|
Lease operating expense |
|
133 |
|
|
132 |
|
|
419 |
|
|
424 |
|
Production and ad valorem
taxes |
|
28 |
|
|
44 |
|
|
89 |
|
|
146 |
|
Transportation and gathering
expense |
|
74 |
|
|
40 |
|
|
185 |
|
|
119 |
|
Exploration expense |
|
203 |
|
|
217 |
|
|
308 |
|
|
350 |
|
Depreciation, depletion and
amortization |
|
539 |
|
|
460 |
|
|
1,444 |
|
|
1,297 |
|
General and administrative |
|
109 |
|
|
132 |
|
|
308 |
|
|
399 |
|
Asset impairments |
|
— |
|
|
33 |
|
|
43 |
|
|
164 |
|
Other operating (income) expense,
net |
|
182 |
|
|
(19 |
) |
|
252 |
|
|
(31 |
) |
Total operating expenses |
|
1,268 |
|
|
1,039 |
|
|
3,048 |
|
|
2,868 |
|
Operating Income
(Loss) |
|
(467 |
) |
|
230 |
|
|
(761 |
) |
|
1,163 |
|
Other (Income)
Expense |
|
|
|
|
|
|
|
|
(Gain) on commodity derivative
instruments |
|
(267 |
) |
|
(385 |
) |
|
(331 |
) |
|
(74 |
) |
Interest, net of amount
capitalized |
|
71 |
|
|
52 |
|
|
183 |
|
|
151 |
|
Other non-operating (income)
expense, net |
|
(12 |
) |
|
(13 |
) |
|
(20 |
) |
|
1 |
|
Total other (income) expense |
|
(208 |
) |
|
(346 |
) |
|
(168 |
) |
|
78 |
|
Income (Loss)
Before Income Taxes |
|
(259 |
) |
|
576 |
|
|
(593 |
) |
|
1,085 |
|
Income Tax (Benefit)
Provision |
|
24 |
|
|
157 |
|
|
(180 |
) |
|
274 |
|
Net Income
(Loss) |
|
$ |
(283 |
) |
|
$ |
419 |
|
|
$ |
(413 |
) |
|
$ |
811 |
|
Earnings (Loss)
Per Share |
|
|
|
|
|
|
|
|
Earnings (Loss) Per Share,
Basic |
|
$ |
(0.67 |
) |
|
$ |
1.16 |
|
|
$ |
(1.05 |
) |
|
$ |
2.25 |
|
Earnings (Loss) Per Share,
Diluted |
|
$ |
(0.67 |
) |
|
$ |
1.12 |
|
|
$ |
(1.05 |
) |
|
$ |
2.21 |
|
|
|
|
|
|
|
|
|
|
Weighted average number of
shares outstanding |
|
|
|
|
|
|
|
|
Basic |
|
420 |
|
|
362 |
|
|
392 |
|
|
361 |
|
Diluted |
|
420 |
|
|
367 |
|
|
392 |
|
|
367 |
|
These
financial statements should be read in conjunction with the
financial statements and the accompanying notes and other
information included in Noble Energy's Quarterly Report on Form
10-Q to be filed with the Securities and Exchange Commission on
November 2, 2015. |
|
|
|
|
|
|
|
|
On July
20, 2015, we completed the merger with Rosetta Resources Inc.
(Rosetta or Rosetta Merger) and the results of operations
attributable to Rosetta are included in our consolidated statement
of operations beginning on July 21, 2015. The results of these
operations attributable to Rosetta will affect the comparability of
our financial results to prior periods. |
Schedule 2 |
Noble Energy, Inc. |
Condensed Balance Sheets |
(in millions, unaudited) |
|
|
|
September 30, |
|
December 31, |
|
|
2015 |
|
2014 |
ASSETS |
|
|
|
|
Current Assets |
|
|
|
|
Cash and cash equivalents |
|
$ |
1,028 |
|
|
$ |
1,183 |
|
Accounts receivable, net |
|
571 |
|
|
857 |
|
Commodity derivative assets,
current |
|
650 |
|
|
710 |
|
Other current assets |
|
281 |
|
|
325 |
|
Total current assets |
|
2,530 |
|
|
3,075 |
|
Net property, plant and
equipment |
|
21,749 |
|
|
18,143 |
|
Goodwill |
|
945 |
|
|
620 |
|
Other noncurrent assets |
|
741 |
|
|
715 |
|
Total Assets |
|
$ |
25,965 |
|
|
$ |
22,553 |
|
LIABILITIES AND
SHAREHOLDERS' EQUITY |
|
|
|
|
Current Liabilities |
|
|
|
|
Accounts payable - trade |
|
$ |
1,297 |
|
|
$ |
1,578 |
|
Other current liabilities |
|
795 |
|
|
944 |
|
Total current liabilities |
|
2,092 |
|
|
2,522 |
|
Long-term debt |
|
8,033 |
|
|
6,103 |
|
Deferred income taxes,
noncurrent |
|
2,286 |
|
|
2,516 |
|
Other noncurrent liabilities |
|
1,104 |
|
|
1,087 |
|
Total Liabilities |
|
13,515 |
|
|
12,228 |
|
Total Shareholders’ Equity |
|
12,450 |
|
|
10,325 |
|
Total Liabilities and Shareholders’
Equity |
|
$ |
25,965 |
|
|
$ |
22,553 |
|
These
financial statements should be read in conjunction with the
financial statements and the accompanying notes and other
information included in Noble Energy's Quarterly Report on Form
10-Q to be filed with the Securities and Exchange Commission on
November 2, 2015. |
Schedule 3 |
Noble Energy, Inc. |
Volume and Price Statistics |
(unaudited) |
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2015 |
|
2014 |
|
2015 |
|
2014 |
Crude Oil and
Condensate Sales Volumes (MBbl/d) |
|
|
|
|
|
|
|
|
United States |
|
83 |
|
|
67 |
|
|
73 |
|
|
66 |
|
Equatorial Guinea |
|
27 |
|
|
29 |
|
|
29 |
|
|
32 |
|
Other International |
|
— |
|
|
— |
|
|
1 |
|
|
3 |
|
Total consolidated operations |
|
110 |
|
|
96 |
|
|
103 |
|
|
101 |
|
Equity method investee - Equatorial
Guinea |
|
2 |
|
|
2 |
|
|
2 |
|
|
2 |
|
Total sales volumes |
|
112 |
|
|
98 |
|
|
105 |
|
|
103 |
|
Crude Oil and
Condensate Realized Prices ($/Bbl) |
|
|
|
|
|
|
|
|
United States |
|
$ |
42.42 |
|
|
$ |
94.21 |
|
|
$ |
46.02 |
|
|
$ |
96.84 |
|
Equatorial Guinea |
|
45.99 |
|
|
98.63 |
|
|
52.15 |
|
|
104.38 |
|
Other International |
|
— |
|
|
— |
|
|
55.52 |
|
|
104.47 |
|
Consolidated average realized
prices |
|
$ |
43.30 |
|
|
$ |
95.55 |
|
|
$ |
47.79 |
|
|
$ |
99.48 |
|
Natural Gas Sales
Volumes (MMcf/d) |
|
|
|
|
|
|
|
|
United States |
|
741 |
|
|
538 |
|
|
658 |
|
|
497 |
|
Equatorial Guinea |
|
231 |
|
|
233 |
|
|
221 |
|
|
241 |
|
Israel |
|
303 |
|
|
262 |
|
|
254 |
|
|
233 |
|
Total sales volumes |
|
1,275 |
|
|
1,033 |
|
|
1,133 |
|
|
971 |
|
Natural Gas
Realized Prices ($/Mcf) |
|
|
|
|
|
|
|
|
United States |
|
$ |
2.01 |
|
|
$ |
3.41 |
|
|
$ |
2.20 |
|
|
$ |
4.12 |
|
Equatorial Guinea |
|
0.27 |
|
|
0.27 |
|
|
0.27 |
|
|
0.27 |
|
Israel |
|
5.39 |
|
|
5.59 |
|
|
5.39 |
|
|
5.59 |
|
Consolidated average realized
prices |
|
$ |
2.50 |
|
|
$ |
3.26 |
|
|
$ |
2.54 |
|
|
$ |
3.52 |
|
Natural Gas
Liquids Sales Volumes (MBbl/d) |
|
|
|
|
|
|
|
|
United States |
|
49 |
|
|
25 |
|
|
34 |
|
|
22 |
|
Equity method investee - Equatorial
Guinea |
|
6 |
|
|
6 |
|
|
5 |
|
|
6 |
|
Total sales volumes |
|
55 |
|
|
31 |
|
|
39 |
|
|
28 |
|
Natural Gas
Liquids Realized Prices ($/Bbl) |
|
|
|
|
|
|
|
|
United States |
|
$ |
7.49 |
|
|
$ |
29.53 |
|
|
$ |
9.78 |
|
|
$ |
35.39 |
|
Barrels of Oil
Equivalent Volumes (MBoe/d) |
|
|
|
|
|
|
|
|
United States |
|
255 |
|
|
182 |
|
|
217 |
|
|
171 |
|
Equatorial Guinea |
|
65 |
|
|
68 |
|
|
66 |
|
|
72 |
|
Israel |
|
51 |
|
|
44 |
|
|
43 |
|
|
39 |
|
Other International |
|
— |
|
|
— |
|
|
1 |
|
|
3 |
|
Total consolidated operations |
|
371 |
|
|
294 |
|
|
327 |
|
|
285 |
|
Equity method investee - Equatorial
Guinea |
|
8 |
|
|
8 |
|
|
6 |
|
|
7 |
|
Total sales volumes |
|
379 |
|
|
302 |
|
|
333 |
|
|
292 |
|
On July
20, 2015, we completed the merger with Rosetta and the associated
volumes and price statistics are included in our operations
beginning on July 21, 2015. The results of these volumes and
prices attributable to Rosetta will affect the comparability of our
results to prior periods. |
Schedule 4 |
Noble Energy, Inc. |
Reconciliation of Net Income (Loss) to
Adjusted Income (Loss) |
(in millions, except per share amounts,
unaudited) |
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2015 |
|
Per Diluted Share |
|
2014 |
|
Per Diluted Share |
|
2015 |
|
Per Diluted Share |
|
2014 |
|
Per Diluted Share |
Net Income (Loss) |
|
$ |
(283 |
) |
|
$ |
(0.67 |
) |
|
$ |
419 |
|
|
$ |
1.14 |
|
|
$ |
(413 |
) |
|
$ |
(1.05 |
) |
|
$ |
811 |
|
|
$ |
2.21 |
|
(Gain) loss on commodity derivative
instruments, net of cash settlements [1] |
|
17 |
|
|
0.04 |
|
|
(397 |
) |
|
(1.08 |
) |
|
352 |
|
|
0.90 |
|
|
(169 |
) |
|
(0.46 |
) |
Asset impairments
[2] |
|
— |
|
|
— |
|
|
33 |
|
|
0.09 |
|
|
43 |
|
|
0.11 |
|
|
164 |
|
|
0.45 |
|
(Gain) on divestitures
[3] |
|
— |
|
|
— |
|
|
(30 |
) |
|
(0.08 |
) |
|
— |
|
|
— |
|
|
(72 |
) |
|
(0.20 |
) |
Deferred compensation
[4] |
|
(13 |
) |
|
(0.03 |
) |
|
(12 |
) |
|
(0.03 |
) |
|
(19 |
) |
|
(0.05 |
) |
|
— |
|
|
— |
|
Corporate restructuring
[5] |
|
21 |
|
|
0.05 |
|
|
— |
|
|
— |
|
|
39 |
|
|
0.10 |
|
|
— |
|
|
— |
|
Stacked drilling rig
[6] |
|
13 |
|
|
0.03 |
|
|
— |
|
|
— |
|
|
20 |
|
|
0.05 |
|
|
— |
|
|
— |
|
Pension plan expense
[7] |
|
67 |
|
|
0.16 |
|
|
— |
|
|
— |
|
|
88 |
|
|
0.22 |
|
|
— |
|
|
— |
|
Rosetta Merger expenses
[8] |
|
71 |
|
|
0.17 |
|
|
— |
|
|
— |
|
|
73 |
|
|
0.18 |
|
|
— |
|
|
— |
|
Other adjustments |
|
1 |
|
|
— |
|
|
(2 |
) |
|
— |
|
|
7 |
|
|
0.02 |
|
|
(2 |
) |
|
— |
|
Total adjustments before tax |
|
177 |
|
|
0.42 |
|
|
(408 |
) |
|
(1.10 |
) |
|
603 |
|
|
1.53 |
|
|
(79 |
) |
|
(0.21 |
) |
Income tax effect of adjustments
[9] |
|
16 |
|
|
0.04 |
|
|
91 |
|
|
0.24 |
|
|
(169 |
) |
|
(0.43 |
) |
|
(6 |
) |
|
(0.02 |
) |
Adjusted Income (Loss) |
|
$ |
(90 |
) |
|
$ |
(0.21 |
) |
|
$ |
102 |
|
|
$ |
0.28 |
|
|
$ |
21 |
|
|
$ |
0.05 |
|
|
$ |
726 |
|
|
$ |
1.98 |
|
Weighted average number of shares
outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
420 |
|
|
|
|
367 |
|
|
|
|
395 |
|
|
|
|
367 |
|
|
|
NOTE: |
Adjusted income (loss)
should not be considered an alternative to, or more meaningful
than, net income (loss) as reported in accordance with GAAP.
Adjusted income (loss) is provided for comparison to earnings
forecasts prepared by analysts and other third parties. Our
management believes, and certain investors may find, that adjusted
income (loss) is beneficial in evaluating our financial
performance. We believe such measures can facilitate comparisons of
operating performance between periods and with our peers. However,
Noble Energy's method of computing this measure may not be the same
method used to compute similar measures reported by other entities.
See Schedule 1: Summary Statement of Operations. |
|
|
|
On July 20, 2015, we
completed the merger with Rosetta and the results of operations
attributable to Rosetta are included in our consolidated statement
of operations beginning on July 21, 2015. The results of these
operations attributable to Rosetta will affect the comparability of
our financial results to prior periods. |
[1] |
Many factors impact our gain or loss on commodity
derivative instruments, net of cash settlements, including:
increases and decreases in the commodity forward price curves
compared to our executed hedging arrangements; increases in hedged
future revenues; and the mix of hedge arrangements between NYMEX
WTI, Dated Brent and NYMEX HH commodities. These gains or losses on
commodity derivative instruments, net of cash settlements,
recognized in the current period, will be realized in the future
when cash settlement occurs. |
|
|
[2] |
Amount for 2015 relates primarily to Eastern
Mediterranean and Gulf of Mexico properties and amount for 2014
relates primarily to North Sea properties. |
|
|
[3] |
Amount for 2014 represents sales of non-core
onshore U.S. properties and China assets. |
|
|
[4] |
Amount represents (increases) decreases in the
fair value of shares of our common stock held in a rabbi
trust. |
|
|
[5] |
Amount represents expenses associated with the
relocation of our personnel. The expenses primarily include the
relocation of our Ardmore, Oklahoma office, as well as the
consolidation of our Houston personnel to our corporate
headquarters in Houston. |
|
|
[6] |
Amount represents the day rate cost associated
with drilling rigs under contract, but not currently being utilized
in our US onshore drilling programs. |
|
|
[7] |
Amount includes the expensing of the actuarial
loss from AOCL, related to the termination and re-measurement of
our defined benefit pension plan. |
|
|
[8] |
Amount represents expenses associated with the
completion of the Rosetta Merger. |
|
|
[9] |
The income tax effect of adjustments is
determined for each major tax jurisdiction for each adjusting item.
The difference between the GAAP income tax provision of $24 million
and the tax effect of adjustments $16 million represents an
adjusted tax expense of $8 million. |
Schedule 5 |
Noble Energy, Inc. |
Discretionary Cash Flow and Reconciliation to
Net Cash Provided by Operating Activities |
(in millions, unaudited) |
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2015 |
|
2014 |
|
2015 |
|
2014 |
Adjusted Income
(Loss) [1] |
|
$ |
(90 |
) |
|
$ |
102 |
|
|
$ |
21 |
|
|
$ |
726 |
|
Adjustments to reconcile
adjusted income to discretionary cash flow |
|
|
|
|
|
|
|
|
Depreciation, depletion and
amortization |
|
539 |
|
|
460 |
|
|
1,444 |
|
|
1,297 |
|
Exploration expense |
|
203 |
|
|
217 |
|
|
308 |
|
|
350 |
|
(Income)/Dividends from equity
method investments, net |
|
(8 |
) |
|
56 |
|
|
(4 |
) |
|
53 |
|
Deferred income taxes |
|
42 |
|
|
(53 |
) |
|
(95 |
) |
|
68 |
|
Stock-based compensation
expense |
|
16 |
|
|
22 |
|
|
54 |
|
|
67 |
|
Other |
|
6 |
|
|
7 |
|
|
(3 |
) |
|
7 |
|
Discretionary Cash
Flow |
|
$ |
708 |
|
|
$ |
811 |
|
|
$ |
1,725 |
|
|
$ |
2,568 |
|
Reconciliation to
Operating Cash Flows |
|
|
|
|
|
|
|
|
Net changes in working capital |
|
(108 |
) |
|
181 |
|
|
(74 |
) |
|
286 |
|
Cash exploration costs |
|
(13 |
) |
|
(47 |
) |
|
(73 |
) |
|
(154 |
) |
Current tax benefit of earnings
adjustments |
|
12 |
|
|
— |
|
|
20 |
|
|
— |
|
Corporate restructuring |
|
(21 |
) |
|
— |
|
|
(39 |
) |
|
— |
|
Stacked drilling rig |
|
(13 |
) |
|
— |
|
|
(20 |
) |
|
— |
|
Rosetta Merger expenses |
|
(56 |
) |
|
— |
|
|
(58 |
) |
|
— |
|
Other adjustments |
|
11 |
|
|
— |
|
|
5 |
|
|
3 |
|
Net Cash Provided
by Operating Activities |
|
$ |
520 |
|
|
$ |
945 |
|
|
$ |
1,486 |
|
|
$ |
2,703 |
|
|
|
|
|
|
|
|
|
|
Capital expenditures
(accrual based) |
|
$ |
664 |
|
|
$ |
1,335 |
|
|
$ |
2,325 |
|
|
$ |
3,558 |
|
Increase in capital lease
obligations [2] |
|
29 |
|
|
60 |
|
|
60 |
|
|
81 |
|
Total Capital
Expenditures (Accrual Based) |
|
$ |
693 |
|
|
$ |
1,395 |
|
|
$ |
2,385 |
|
|
$ |
3,639 |
|
NOTE: |
Discretionary cash flow
should not be considered an alternative to, or more meaningful
than, net income (loss), net cash provided by operating activities,
or any other measure as reported in accordance with GAAP. The table
above reconciles discretionary cash flow to net cash provided by
operating activities. Our management believes, and certain
investors may find that discretionary cash flow is useful as an
indicator of the company's ability to fund exploration and
production activities and meet financial obligations.
Discretionary cash flow is also useful as a basis for valuing
companies in the oil and gas industry. However, Noble
Energy's method of computing this measure may not be the same
method used to compute similar measures reported by other
entities. |
|
|
|
On July 20, 2015, we
completed the merger with Rosetta and the results of operations
attributable to Rosetta are included in our consolidated statement
of operations beginning on July 21, 2015. The results of these
operations attributable to Rosetta will affect the comparability of
our financial results to prior periods. |
[1] |
See Schedule 4: Reconciliation of Net Income
(Loss) to Adjusted Income (Loss). |
[2] |
Represents estimated construction in progress to
date on US operating assets and corporate buildings. |
Investor Contacts:
Brad Whitmarsh
(281) 943-1670
brad.whitmarsh@nblenergy.com
John Nicholson
(281) 876-6186
John.nicholson@nblenergy.com
Media Contacts:
Reba Reid
(281) 943-1789
media@nblenergy.com
Paula Beasley
(281) 876-6133
media@nblenergy.com
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