(Source: Shutterstock.com)
Repsol plans to release its Marcellus Shale rig in June but will maintain another rig in the Eagle Ford Shale, CEO Josu Jon Imaz said during a quarterly webcast.
Repsol will drop the rig due to the current U.S. gas price environment, Imaz said during a first-quarter 2024 earnings webcast with analysts. As a result, Repsol will also reduce capex in the Marcellus play.
“And as a consequence of this reduction, the free cash flow breakeven for the Marcellus this year is going to be at $2 million Btu [MMBtu]. So, I mean, it’s not a big figure taking into account current prices, but let me say that it’s okay,” Imaz said.
“Saying that, what we are doing is also because we have a more positive view for gas prices for coming years. And what we are doing is guaranteeing that the production is going to be there. This year, we are producing more or less [about] 135,000 barrels a day in equivalent terms. I mean we are talking about gas,” Imaz said.
RELATED
Repsol Eyes Increasing Core US Upstream Business
Imaz said the Madrid-based energy company is trying to mitigate its exposure to Henry Hub through hedging.
“Approximately 20% of our North American gas production in 2024, 50% in 2025 and 60% in 2026,” has been hedged, Imaz said. “On average, around 40% of our North American production in 2024-2026 has been hedged through derivatives … with a minimum floor in all cases above $3/MMBtu. So, we are quite comfortable [in] this position.”
Recommended Reading
Report: Leak Detection and Repair Work Growing Globally
2025-01-17 - Natural gas trends are boosting the companies that monitor and repair leaks, a consulting firm said in a report.
Oklo Signs MOU with RPower for Phased Power to Data Centers
2025-01-17 - Oklo and power generation company RPower will work together to provide a phased natural gas-to-emissions free approach to power data centers
US Drillers Cut Oil, Gas Rigs to Lowest Since December 2021, Baker Hughes Says
2025-01-17 - The oil and gas rig count fell by four to 580 in the week to Jan. 17.
Talos Energy’s Katmai West #2 Well Hits Oil, Gas Pay in GoM
2025-01-15 - Combined with the Katmai West #1 well, the Katmai West #2 well has nearly doubled the Katamai West Field’s proved EUR to approximately 50 MMboe gross, Talos Energy said.
Formentera Joins EOG in Wildcatting South Texas’ Oily Pearsall Pay
2025-01-15 - Known in the past as a “heartbreak shale,” Formentera Partners is counting on bigger completions and longer laterals to crack the Pearsall code, Managing Partner Bryan Sheffield said. EOG Resources is also exploring the shale.
Comments
Add new comment
This conversation is moderated according to Hart Energy community rules. Please read the rules before joining the discussion. If you’re experiencing any technical problems, please contact our customer care team.