February 9, 2015 / 7:03 AM / 3 years ago

Gran Tierra slashes 2015 capital budget as oil prices plunge

Feb 9 (Reuters) - Gran Tierra Energy Inc, a Canadian oil and gas producer, more than halved its 2015 capex budget and cut its production forecast for the year following the sharp decline in oil prices.

Gran Tierra slashed its 2015 capital budget to $140 million from $310 million and cut production forecast for the year to 21,500-22,500 barrels of oil equivalent per day (boepd) from its earlier forecast of 26,000 to 27,000 boepd.

The company will continually review the capital program for additional future reductions and it is also reviewing its entire exploration portfolio with an emphasis on reducing both its risk profile and capital exposure, Gran Tierra said.

Tepid demand growth and forecasts that global oversupply would persist until next year because of OPEC’s refusal to reduce output are weighing on oil prices.

Brent crude, which has fallen sharply from $115 per barrel in June, rose 30 cents to $58.10 a barrel on Monday.

Global oil and gas exploration projects worth more than $150 billion are likely to be put on hold in 2015 as plunging oil prices render them uneconomic, according to data from Norwegian consultancy Rystad Energy.

Several large U.S. oil producers, including ConocoPhillips and Apache Corp, have set lower capital budgets for 2015 and some have said they will deploy fewer drilling rigs in 2015. (Reporting by Zara Mascarenhas in Bengaluru; Editing by Gopakumar Warrier)

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