BANGALORE, Feb 25 - Oil and natural gas exploration and production companies including Continental Resources Inc (CLR.N) and Plains Exploration and Production Co (PXP.N) forecast higher spending for 2010 as they bank on higher hydrocarbon prices and increased drilling activity.
Benchmark U.S. crude oil prices CLc1 averaged $76 per barrel in the fourth quarter, up from the third quarter and from a year ago. Natural gas prices have also recovered from their lows, although heavy supplies and weak demand continue to drag.
Continental Resources boosted its 2010 capital budget by 31 percent to $850 million, to accelerate drilling in its properties in the Bakken and Anadarko Woodford plays. [ID:nSGE61O0HK]
"We're building a strong presence in the Anadarko Woodford, which has a strong oil component," Continental CEO Harold Hamm said in a statement. "We believe the Anadarko Woodford is of the quality to be Continental's next major building block."
The company also raised its production growth outlook for 2010 to about 13 percent, up from its earlier view of 10 percent.
"Continental is a company that has been using their balance sheet to generate more growth," UBS analyst Andrew Coleman told Reuters. "The market has been expecting more growth, and this is what Continental has done."
Coleman backed Continental's spending outlook and said its growth was more visible compared to Plains, as it was more focused on just two plays in North Dakota and Anadarko Woodford.
"With Plains, it is based on exploration kind of productivity," he said. "It may lead to a very big success on a well, but it is difficult to sit back and predict what is going to happen."
Plains Exploration raised its capital budget to $1.2 billion, from earlier plans of $900 million to $1.1 billion, and said spending would be directed to the company's core assets in Haynesville shale, the Gulf of Mexico and the Gulf coast.
Plains said it was "increasing our average annual production growth target to 15 percent, up from 10 percent, through 2014. Our average annual reserve growth target is 20 percent over the next several years."
Smaller peer Berry Petroleum Corp (BRY.N) also raised its spending outlook, while Venoco Inc (VQ.N) and W&T Offshore Inc (WTI.N) forecast higher budgets year-on-year.
Benchmark U.S. crude oil prices CLc1 averaged $76 per barrel in the fourth quarter, up from the third quarter and from a year ago. Natural gas prices have also recovered from their lows, although heavy supplies and weak demand continue to drag.
Continental Resources boosted its 2010 capital budget by 31 percent to $850 million, to accelerate drilling in its properties in the Bakken and Anadarko Woodford plays. [ID:nSGE61O0HK]
"We're building a strong presence in the Anadarko Woodford, which has a strong oil component," Continental CEO Harold Hamm said in a statement. "We believe the Anadarko Woodford is of the quality to be Continental's next major building block."
The company also raised its production growth outlook for 2010 to about 13 percent, up from its earlier view of 10 percent.
"Continental is a company that has been using their balance sheet to generate more growth," UBS analyst Andrew Coleman told Reuters. "The market has been expecting more growth, and this is what Continental has done."
Coleman backed Continental's spending outlook and said its growth was more visible compared to Plains, as it was more focused on just two plays in North Dakota and Anadarko Woodford.
"With Plains, it is based on exploration kind of productivity," he said. "It may lead to a very big success on a well, but it is difficult to sit back and predict what is going to happen."
Plains Exploration raised its capital budget to $1.2 billion, from earlier plans of $900 million to $1.1 billion, and said spending would be directed to the company's core assets in Haynesville shale, the Gulf of Mexico and the Gulf coast.
Plains said it was "increasing our average annual production growth target to 15 percent, up from 10 percent, through 2014. Our average annual reserve growth target is 20 percent over the next several years."
Smaller peer Berry Petroleum Corp (BRY.N) also raised its spending outlook, while Venoco Inc (VQ.N) and W&T Offshore Inc (WTI.N) forecast higher budgets year-on-year.
