BANGALORE, March 1 - Independent oil and natural gas company Mariner Energy Inc (ME.N) said strong production in the second half of the year, helped by a rise in shelf production, would help it meet its production outlook for the year, sending its shares up as much as 7 percent.
The company, which reported strong fourth-quarter results, said despite January production coming in slightly lower than its expectations, it was on target to meet its yearly production forecast.
Shares of the company were trading up 4 percent at $15.64 in afternoon trade, outperforming a 0.70 percent gain in the Dow Jones U.S. Oil & Gas Index .DJUSEN.
The Houston-based company's production is expected to be driven by its Permian and deep water assets, complemented by a rise in production from its shelf assets.
As it starts to execute a number of deferred recompletions, its shelf production is expected to grow, helped by lower service costs and better commodity prices, Chief Executive Scott Josey said on a conference call with analysts.
Earlier, bigger rival El Paso Corp (EP.N) reported a quarterly profit compared with a year-ago loss and raised its production forecast for the year. [ID:nN01201770]
In December last year, Mariner forecast 2010 production of 130 billion cubic feet equivalent (bcfe) to 140 bcfe. [ID:nSGE5BF0HI]
"They can still come at the lower end of their full year guidance as February production has ramped up to the point where it was in line with what I am modelling for the first quarter," Jefferies & Co analyst Biju Perincheril said.
"It (shelf) is about 40 percent of their production, a big component, so its important to at least keep volumes flat." The company is very excited about the potential of the its deepwater Lucius discovery as well as its existing assets in Permian.
"Our proved reserves do not yet reflect any contribution from a number of our deepwater discoveries. These unbooked projects should significantly enhance reserves and production in future years," Josey said in a statement.
2009 proved reserves rose 12 percent to 1.1 tcfe, achieving a proved reserve replacement rate for 2009 of 190 percent from all sources.
Net production for the quarter was 30.8 bcfe, compared with 23.5 bcfe reported last year.
For the latest fourth quarter, net income was $83.3 million, or 82 cents a share, compared with a loss of $648.9 million, or $7.41 a share, last year. Total revenue rose 1.3 percent in the quarter.
Excluding items, profit was 17 cents a share, which was ahead of analysts' average estimate 10 cents a share, according to Thomson Reuters I/B/E/S.
The company's shares were trading at $15.62, paring some of its gains after touching a session high of $16.04.
The company, which reported strong fourth-quarter results, said despite January production coming in slightly lower than its expectations, it was on target to meet its yearly production forecast.
Shares of the company were trading up 4 percent at $15.64 in afternoon trade, outperforming a 0.70 percent gain in the Dow Jones U.S. Oil & Gas Index .DJUSEN.
The Houston-based company's production is expected to be driven by its Permian and deep water assets, complemented by a rise in production from its shelf assets.
As it starts to execute a number of deferred recompletions, its shelf production is expected to grow, helped by lower service costs and better commodity prices, Chief Executive Scott Josey said on a conference call with analysts.
Earlier, bigger rival El Paso Corp (EP.N) reported a quarterly profit compared with a year-ago loss and raised its production forecast for the year. [ID:nN01201770]
In December last year, Mariner forecast 2010 production of 130 billion cubic feet equivalent (bcfe) to 140 bcfe. [ID:nSGE5BF0HI]
"They can still come at the lower end of their full year guidance as February production has ramped up to the point where it was in line with what I am modelling for the first quarter," Jefferies & Co analyst Biju Perincheril said.
"It (shelf) is about 40 percent of their production, a big component, so its important to at least keep volumes flat." The company is very excited about the potential of the its deepwater Lucius discovery as well as its existing assets in Permian.
"Our proved reserves do not yet reflect any contribution from a number of our deepwater discoveries. These unbooked projects should significantly enhance reserves and production in future years," Josey said in a statement.
2009 proved reserves rose 12 percent to 1.1 tcfe, achieving a proved reserve replacement rate for 2009 of 190 percent from all sources.
Net production for the quarter was 30.8 bcfe, compared with 23.5 bcfe reported last year.
For the latest fourth quarter, net income was $83.3 million, or 82 cents a share, compared with a loss of $648.9 million, or $7.41 a share, last year. Total revenue rose 1.3 percent in the quarter.
Excluding items, profit was 17 cents a share, which was ahead of analysts' average estimate 10 cents a share, according to Thomson Reuters I/B/E/S.
The company's shares were trading at $15.62, paring some of its gains after touching a session high of $16.04.
