Paramount Focusing on Efficiencies, Bringing Online Fifth Walking Rig - Natural Gas Intelligence
Paramount Focusing on Efficiencies, Bringing Online Fifth Walking Rig - Natural Gas Intelligence
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Paramount Focusing on Efficiencies, Bringing Online Fifth Walking Rig
Paramount Resources Ltd. has set its sights on finishing its fifth walking rig after higher natural gas and oil prices more than doubled 2022 earnings.
The independent reports earnings in Canadian dollars (C$1.00/US 75 cents).
The Calgary firm’s 2023 budget enables subsidiary Fox Drilling to finish building the high-tech rig for $16.8 million. The program revives a bygone tradition of production companies owning field service operations instead of relying on contractors.
“The walking rigs have the capability of moving across a lease with the derrick and drill pipe remaining vertical, significantly increasing efficiencies,” according to Paramount. “All of the Fox Drilling rigs are bi-fuel capable, enabling the use of company-produced natural gas to save costs and reduce emissions compared to diesel engines.”
Annual average production rose to 294.7 MMcf/d of gas in 2022, from 275.2 MMcf/d in 2021. Oil and condensate output was 33,908 b/d, up from 30,989 b/d. Liquids rose to 5,650 b/d from 5,147 b/d.
Average natural gas prices fetched by Paramount jumped to $6.24/Mcf in 2022, from $3.72 in 2021. Average prices for oil and condensate were $117.07/bbl, up from $81.91. Liquids fetched an average price of $55.37/bbl, up from $41.84.
Meanwhile, Paramount has increased its 2023 guidance for capital expenditures by $50 million, to a range of $700 million to $750 million, “as a result of anticipated inflationary cost pressures.”
The producer also has reduced its free cash flow expectations to $375 million from $630 million “to reflect lower natural gas prices, updated capital expenditures in 2023 and revised foreign exchange rates and other assumptions.”
Paramount reported fourth quarter earnings of $259.9 million ($1.83/share) from $101 million (75 cents) in 2021. Full year 2022 earnings surged to $681 million ($4.83/share), from $237 million ($1.77).
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