(Reuters) - Canadian Natural Resources Ltd (CNQ.TO) reported a 19 percent fall in second-quarter net profit on lower oil and gas prices, and further cut spending on natural gas.
“Targeted capital expenditures for 2012 are being re-allocated from natural gas to higher return primary heavy crude oil projects,” the company said in a statement, reducing its capital budget by about C$680 million.
Natural gas prices have fallen 46 percent during April-June from last year while U.S. crude oil prices fell 9 percent.
The company expect to produce between 1,220 million cubic feet per day (MMcf/d) and 1,235 MMcf/d of natural gas, and between 454,000 barrels per day of (bpd) and 474,000 bpd of crude oil in 2012, before royalties.
For the second quarter, the company produced 679,607 barrels of oil equivalent per day (boe/d), up from 556,539 boe/d a year earlier.
Net income fell to C$753 million ($756.8 million), or 68 Canadian cents per share, from C$929 million, or 84 Canadian cents per share, a year earlier.
Adjusted earnings from operations were 55 Canadian cents per share.
Revenue rose 15 percent to C$3.83 billion.
Shares of the company, which has a market value of $32.54 billion, closed at C$29.57 on Wednesday on the Toronto Stock Exchange.
Reporting by Bhaswati Mukhopadhyay and Shounak Dasgupta in Bangalore; Editing by Roshni Menon