HOUSTON (Reuters) - ConocoPhillips (COP.N) cut its 2017 capital spending by 4 percent on Thursday, the latest U.S. oil and natural gas producer to do so in reaction to depressed crude prices.
Conoco and its peers had mapped out ambitious capital spending programs for 2017 early in the year, expecting oil prices to be higher than where they are today, just under $50 per barrel.
“This is the right approach for value creation in the upstream sector, especially at a time of uncertainty in the commodity markets,” Conoco Chief Executive Officer Ryan Lance said in a statement.
Conoco now plans to spend $4.8 billion this year, down from a prior estimate of $5 billion. The cut came after Conoco reported its quarterly loss more than tripled despite recent asset sales.
Shares of the Houston-based company rose 1.2 percent to $44.21 in afternoon trading as oil prices traded slightly higher CLc1.
Conoco has aggressively moved to sell assets and cull debt in the past year, steps praised by Wall Street. The company repaid $3 billion in debt during the quarter and expects to pay off $2.4 billion by the end of the year, which would bring its debt load under $20 billion.
Conoco’s net loss widened to $3.4 billion, or $2.78 per share, in the quarter, from $1.1 billion, or 78 cents per share, in the year-ago quarter.
Excluding one-time items, the company earned 14 cents per share. By that measure, analysts expected a loss of 2 cents per share, according to Thomson Reuters I/B/E/S.
The results reflect a “solid quarter” for Conoco, Simmons & Co analysts Guy Baber said in a note to clients.
Production fell 8 percent to 1.4 million barrels of oil equivalent per day.
Still, the company is growing aggressively in its U.S. shale operations, which should see “pretty strong production” through the end of the year, executives told investors on a Thursday conference call.
Conoco last month sold its Canadian oil sands and natural gas assets in March to Cenovus Energy Inc (CVE.TO) in a cash-and-stock deal worth about $13.3 billion. The price was widely seen as high, a boon for Conoco.
Conoco is the latest international oil major to pull back from northern Alberta’s oil sands, among the most costly locations in the world to develop.
Editing by Nick Zieminski and Jeffrey Benkoe