Tuesday, December 6, 2011

Comstock Revises Haynesville Capex

As part of an announcement yesterday about a new leasehold acquisition in west Texas, Comstock Resources revised its capital budget for 2012 and cut some money out of its Haynesville Shale program.  This news shows two trends clearly: 1) continued diminished spending in the Haynesville Shale and 2) the shift by independents towards oil and liquids because of the low gas price environment.

Comstock now plans to spend approximately $545.0 million in 2012 for drilling and completion activities. That figure includes $88.2 million (16% of the total) in the East Texas/North Louisiana region to drill 32 wells (11.3 net), of which 31 (10.6 net) will be Haynesville or Mid-Bossier shale wells.  The company has also allocated $65.0 million to complete 17 wells (14.7 net) drilled in 2011.

This revised budget reflects a lower allocation for the Haynesville Shale.  Back in August, the company announced that it had a capital budget of $396 million, of which $104 million (26% of total) was to have been spent in ETX/NLA for 38 (13.3 net) wells, of which 37 (12.6 net) were to be Haynesville or Mid-Bossier.  The $65 million for 2011 completions remains unchanged.

Both budgets are considerably lower than Comstock's 2011 planned capital expenditures of $401 million, which had been revised downward as well.

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