Coterra Energy misses its profit forecast as oil and gas prices fall
Coterra Energy, a U.S. oil-and-gas producer, missed Wall Street's expectations for the third quarter profit on Thursday because of lower commodity prices.
The benchmark natural gas price remained low for most of the third quarter due to high storage levels and weak demand.
Energy Information Administration (EIA) expects U.S. Gas Production to Decline in 2024 for the First Time Since 2020 as Producers like Coterra reduced their output following prices that reached multi-decade Lows.
The average price of natural gas sold by the company, excluding hedges and other costs, dropped to $1.30 a thousand cubic feet (mcf), down from $1.80 a mcf one year ago. On demand issues, oil prices fell by 8.4% to $74.04 a barrel.
The total production dropped marginally from 670 300 barrels of oil-equivalent per day (boepd), as the decline in natural gas production was mostly offset by an increase in oil production of 22.2%.
Coterra reallocated its resources from the Marcellus Shale, the largest gas-producing region in the United States, to the oil-rich Permian basin and Anadarko Basin, due to the recent slump in gas prices.
However, the company has raised its 2024 production forecast from 660,000 to 775, 000 boepd. This is a 1% increase at mid-point in comparison to earlier projections.
Its shares rose 1.8% in after-market trade.
The company forecasts that oil production will grow by 5% per year for the next 2 years.
It said that the growth in total equivalent production would range from zero to five percent until 2026.
Coterra's net income for the third quarter fell by 22%, to $252 millions.
According to data compiled and analyzed by LSEG, its adjusted profit per share of 32 cents was below the market estimate of 35 cents. (Reporting from Bengaluru by Sourasis BOSE; Editing by Maju Sam)
(source: Reuters)
