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California Resources Gains 30% Following Better-Than-Expected Q4, Encouraging Outlook Commentary

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California Resources Gains 30% Following Better-Than-Expected Q4, Encouraging Outlook Commentary

Shares of California Resources Corp. (NYSE: CRC) surged higher by more than 30 percent Tuesday morning.

California Resources reported that it lost $0.20 per share in the fourth quarter on revenue of $566 million. Wall Street analysts were expecting the company to lose $0.24 per share on revenue of $558.33 million.

California Resources said that its full-year annual crude oil production grew 5 percent to 104,000 barrels per day, while annual total production rose 1 percent to 160,000 barrels of energy per day.

Net loss for the quarter worsened to $77 million from $7 million in the same quarter a year ago. The company cited "significantly" lower realized oil, NGL and gas prices and higher interest expenses, which more than offset lower production and other related costs.

Related Link: Southwestern Energy Has 30% Downside, Barclays Warns

"Today's results further highlight the resiliency of our asset base," Todd Stevens, president and Chief Executive Officer, said. "Despite a severe downturn in commodity prices and an 81-percent capital reduction in 2015, we increased crude oil production five percent. Our focus on steamflood and waterflood opportunities and drilling efficiencies helped us add reserves at a cost lower than our historical average.

"We are proud of the progress our teams have made in reducing drilling costs and improving efficiencies, which allowed us to drill more wells than planned in 2015 with less capital. These results, our reserve replacement rate and F&D costs, which were achieved with meaningfully lower capital investment, demonstrate the favorable attributes of our assets in a stressed environment."

Stevens also noted, "As we entered 2016, crude oil prices deteriorated further. As a result, we took additional steps to align our capital program as well as overall activity and staffing levels with the commodity price environment and projected cash flows. Our reserves estimation process and production results at our flagship Elk Hills asset, where we had no drilling rig for all of 2015, supported our estimated corporate base decline range of 10–15 percent."

Image Credit: Public Domain

 

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