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Whitecap Resources cuts H2 capex by 17%, maintains production growth target

Canada's Whitecap Resources Inc. said it lowered its second half capital expenditures program by 17% to C$250 million from C$300 million in a bid to provide "greater optionality and improve near term free funds flow," according to an Aug. 26 release.

The company's full year 2019 capex is now expected to be C$400 million, or C$50 million lower than its previous guidance of C$450 million.

However, despite the drop in its capex budget, Whitecap maintained its production guidance and anticipates growing output by 6% to a range of 74,000 to 75,000 barrels of oil equivalent per day in the fourth quarter from the second quarter average production of 70,611 boe/d.

Whitecap said the objective of its 2019 budget was to protect its balance sheet, reduce net debt and maintain its current dividend by having a "disciplined" first half program and a "flexible" second half program.

In its second quarter earnings release, Whitecap said that it will drill 174 wells, spend C$300 million on capex in the second half and raise average production to 77,000 boe/d in the fourth quarter.