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Pioneer Natural Resources Company Reports Fourth-Quarter and Full-Year 2019 Financial and Operating Results; Provides 2020 Outlook
President and CEO
Our 2020 plan builds on our strong 2019 performance and is structured to deliver a capitally efficient program that prioritizes free cash flow. Our dividend increase announced today solidifies our commitment to returning capital to shareholders and represents a greater than 185% increase, on an annualized basis, when compared to the dividends paid in 2019. Pioneer continues to offer a compelling value proposition, underpinned by our premier acreage position in the
Pioneer maintains a strong balance sheet, with unrestricted cash on hand as of
During the fourth quarter, the Company’s Permian drilling, completion and facilities capital expenditures totaled
The Company announced today that its Board of Directors has approved an increase in the Company's quarterly cash dividend to
Fourth Quarter Financial Results
For the fourth quarter, the Company’s average realized price for oil was
Production costs, including taxes, averaged
Pioneer continued to see strong efficiency gains in both drilling and completions during the fourth quarter, enabling the Company to place 77 horizontal wells on production. During 2019, both drilling and completions efficiencies increased by greater than 30% when compared to 2017, averaging approximately 1,000 drilled feet per day and 1,600 completed feet per day in 2019, respectively. These increased efficiencies, coupled with approximately 30% lower well costs and strong production, continue to drive increasing corporate returns and free cash flow generation.
During 2020, the Company plans to operate an average of 23 to 24 horizontal rigs in the
The Company continues to transport oil, NGLs and gas from the
The Company expects its 2020 drilling, completions and facilities capital budget to range between
Pioneer expects 2020 oil production of 235 to 245 MBOPD and total production of 383 to 403 MBOEPD. Pioneer's efficient, high-margin growth is driven by the Company's top-tier acreage position in the
Pioneer increased its oil derivative positions to approximately 149 MBOPD for the first quarter of 2020 and 129 MBOPD for full-year 2020 at approximately
First Quarter 2020 Guidance
First quarter 2020 oil production is forecasted to average between 217 to 227 MBOPD and total production to average between 361 to 376 MBOEPD. Production costs are expected to average
The Company added proved reserves totaling 302 million barrels of oil equivalent (MMBOE) during 2019. These proved reserve additions equate to a drillbit reserve replacement ratio of 235% when compared to Pioneer's full-year 2019 production of 128 MMBOE, including field fuel. The drillbit finding and development (F&D) cost was
Environmental, Social & Governance
Pioneer views sustainability as a multidisciplinary focus that balances economic growth, environmental stewardship and social responsibility. The Company emphasizes developing natural resources in a manner that respects surrounding communities and preserves the environment.
Pioneer is focused on reducing emissions and emission intensities. Between 2016 and 2018, the Company's greenhouse gas (GHG) emissions have been reduced by 24%, total GHG emission intensity has decreased by 38% and methane intensity has declined by 41%. Additionally, between
Socially, Pioneer maintains a proactive safety culture, supports a diverse workforce and inspires teamwork to drive innovation. The Board of Directors has a Health, Safety and Environment Committee and a Nominating and Corporate Governance Committee to provide director-level oversight of these activities. These committees help to promote a culture of continuous improvement in safety and environmental practices.
For more details, see Pioneer’s 2019 Sustainability Report at pxd.com/sustainability.
Earnings Conference Call
Telephone: Dial 888-394-8218 and enter confirmation code 6718938 five minutes before the call.
A replay of the webcast will be archived on Pioneer’s website. This replay will be available through
Pioneer is a large independent oil and gas exploration and production company, headquartered in
Except for historical information contained herein, the statements in this news release are forward-looking statements that are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements and the business prospects of Pioneer are subject to a number of risks and uncertainties that may cause Pioneer’s actual results in future periods to differ materially from the forward-looking statements. These risks and uncertainties include, among other things, volatility of commodity prices, product supply and demand, competition, the ability to obtain environmental and other permits and the timing thereof, other government regulation or action, the ability to obtain approvals from third parties and negotiate agreements with third parties on mutually acceptable terms, litigation, the costs and results of drilling and operations, availability of equipment, services, resources and personnel required to perform the Company’s drilling and operating activities, access to and availability of transportation, processing, fractionation, refining, storage and export facilities, Pioneer’s ability to replace reserves, implement its business plans or complete its development activities as scheduled, access to and cost of capital, the financial strength of counterparties to Pioneer’s credit facility, investment instruments and derivative contracts and purchasers of Pioneer’s oil, natural gas liquids and gas production, uncertainties about estimates of reserves and resource potential, identification of drilling locations and the ability to add proved reserves in the future, the assumptions underlying production forecasts, quality of technical data, environmental and weather risks, including the possible impacts of climate change, cybersecurity risks, ability to implement planned stock repurchases, the risks associated with the ownership and operation of the Company’s oilfield services businesses and acts of war or terrorism. These and other risks are described in Pioneer’s Annual Report on Form 10-K for the year ended
Future dividends are at the discretion of the Company's Board of Directors, and, if declared, the Board of Directors may change the dividend amount based on the Company's liquidity and capital resources at that time.
“Drillbit finding and development cost per BOE,” or “drillbit F&D cost per BOE,” means the summation of exploration and development costs incurred divided by the summation of annual proved reserves, on a BOE basis, attributable to discoveries, extensions and revisions of previous estimates. Revisions of previous estimates exclude price revisions. Consistent with industry practice, future capital costs to develop proved undeveloped reserves are not included in costs incurred.
“Drillbit reserve replacement” is the summation of annual proved reserves, on a BOE basis, attributable to discoveries, extensions and revisions of previous estimates divided by annual production of oil, NGLs and gas, on a BOE basis. Revisions of previous estimates exclude price revisions.
“Proved developed finding and development cost per BOE,” or “proved developed F&D cost per BOE,” means the summation of exploration and development costs incurred (excluding asset retirement obligations) divided by the summation of annual proved reserves, on a BOE basis, attributable to proved developed reserve additions, including (i) discoveries and extensions placed on production during 2019, (ii) transfers from proved undeveloped reserves at year-end 2018 and (iii) technical revisions of previous estimates for proved developed reserves during 2019. Revisions of previous estimates exclude price revisions.
Footnote 1: "Return on Capital Employed (ROCE)" is a non-GAAP financial measure. As used by the Company, ROCE is net income adjusted for tax-effected noncash mark-to-market (MTM) adjustments, unusual items and interest expense divided by the summation of average total equity (adjusted for tax-effected noncash MTM adjustments, unusual items and interest expense) and average net debt. See reconciliation to comparable GAAP number in supplemental schedules.
Footnote 2: Free cash flow is a non-GAAP measure, see reconciliation to comparable GAAP number in supplemental schedules.
Footnote 3: Excludes acquisitions, asset retirement obligations, capitalized interest, geological and geophysical G&A, information technology and corporate facilities.
Footnote 4: The 2020 estimated cash flow number is a non-GAAP financial measure, representing January through December forecasted cash flow (before working capital changes) assuming a Nymex oil price of
Footnote 5: The unusual item represents
Pioneer Natural Resources Company
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