Newfield Webcast Notes

Newfield (NFX) CEO Lee Boothby spoke for 40 minutes this morning at the the Citi Global Energy Conference.

Q1 2012 oil production was 47% of total production and I estimate using the back of an envelope should be near to mid-fifties by year end.  Oil production growth for 2012 looks to be 25% and average 64,000 barrels a day.

As do all the U.S. E&P’s, Newfield has a deep inventory of assets with the Uinta being core for them.  The Uinta will consumer $500 million of their $1.5-$1.7 billion dollar 2012 capex budget.  Their market cap is under $4 billion and long term debt is $3 billion.  Newfield is hedged better than most independents.

All drilling is oil focused.  With no dry gas drilling, Newfield’s gas production is actually declining, which is unusual for the independent E&P’s.  A most interesting tidbit:  Newfield’s natural gas production profile will actually flatten out in two years because of associated gas production.

The current oil price is not far from where horizontal drilling budgets will need to be pared back for the industry. 

Boothby sees deteriorating NGL pricing.  NGL’s are in the low $30 a barrel, with spreads increasing monthly.  Fortunately only 5% of company production (thus 10% of liquids) is NGL’s.  The black stuff is what Newfield is chasing.