Canada's Tourmaline Oil cuts 2015 budget as oil prices fall

Mon Dec 15, 2014 3:28pm EST
 
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CALGARY, Alberta Dec 15 (Reuters) - Tourmaline Oil Corp , Canada's No.6 independent oil producer, said on Monday it would cut capital spending in 2015 under a revised budget released just a month ago as the company copes with lower oil prices.

Tourmaline said it expects to spend C$1.4 billion ($1.2 billion) next year, down from a C$1.6 billion estimate made in early November when it forecast annual cash flow at C$1.5 billion. That forecast was reduced to C$1.36 billion on Monday.

Oil prices have dropped by nearly half since June, with benchmark West Texas Intermediate trading near $56 per barrel. The rapid decline has prompted a number of Canadian producers to scale back investment next year, a list that includes Cenovus Energy Inc, MEG Energy Corp, Athabasca Oil Corp and others.

Tourmaline, which produces oil and gas in Western Canada, said it will cut the number of drilling rigs operating on its properties to 16 from the 20 it now uses. However, it left its 2015 production forecast unchanged at 164,500 barrels of oil equivalent per day.

Tourmaline shares rose 3.2 percent to C$36.75 late Monday afternoon on the Toronto Stock Exchange.

($1 = 1.1653 Canadian dollars) (Reporting by Scott Haggett)