KeyFacts Energy today provide the first in a series of updates covering oil and gas company capital expenditure plans for 2022.

Athabasca Oil

Athabasca had previously announced a 2022 capital program of $128 million and is maintaining this guidance. The Company estimates its 2022 production will average 33,000 – 34,000 boe/d.

Canadian Natural Resources

CNR's 2022 budget is targeting base capital of approximately $3.6 billion that delivers targeted production of approximately 1,270,000 BOE/d to 1,320,000 BOE/d, with disciplined year over year near-term growth of approximately 60,000 BOE/d derived primarily from production growth in their conventional E&P operations. Also in 2022, strategic growth capital of approximately $0.7 billion will be allocated to the Company's long life low decline assets which targets to add incremental annual production in 2023 and beyond, resulting in approximate total increases in production of 63,000 bbl/d by 2025. 

In 2022 CNR's diversified production mix is targeted to consist of approximately 46% light and synthetic crude oil, 28% heavy crude oil and 26% natural gas, at the mid-point of their targeted production range.

Cenovus

Cenovus Energy' 2022 guidance includes capital spending of $2.6 billion to $3.0 billion and total production of approximately 800,000 barrels of oil equivalent per day (BOE/d), factoring in major planned turnarounds and production impacts from assets sold in 2021. 

Chevron

Chevron announced a 2022 organic capital and exploratory spending program of $15 billion, at the low end of its $15 to $17 billion guidance range and up more than 20% from 2021 expected levels. This capital program supports Chevron’s objective of higher returns and lower carbon, including approximately $800 million in lower carbon spending. The program excludes expected inorganic capital of $600 million in anticipation of the formation of a renewable fuel feedstocks joint venture with Bunge.

In the upstream business, approximately $8 billion is allocated to currently producing assets, including about $3 billion for Permian Basin unconventional development and approximately $1.5 billion for other shale & tight assets worldwide. Additionally, $3 billion of the upstream program is planned for major capital projects underway, of which about $2 billion is associated with the Future Growth Project and Wellhead Pressure Management Project (FGP / WPMP) at the Tengiz field in Kazakhstan. Finally, approximately $1.5 billion is allocated to exploration, early-stage development projects, midstream activities and carbon reduction opportunities.

Approximately $2.3 billion of planned organic capital spending is associated with the company’s downstream businesses that refine, market and transport fuels, and manufacture and distribute lubricants, additives, and petrochemicals. This also includes capital to grow renewable fuels and products businesses.

ConocoPhillips 

ConocoPhillips’ 2022 operating plan capital budget is $7.2 billion. The plan includes funding for ongoing development drilling programs, major projects, exploration and appraisal activities, base maintenance and $0.2 billion for projects to reduce the company’s Scope 1 and 2 emissions intensity and fund investments in several early-stage low-carbon opportunities that address end-use emissions.

The company’s 2022 production guidance is 1.8 million barrels of oil equivalent per day (MMBOED), including Libya but excluding impacts from the pending Indonesia disposition and acquisition of additional APLNG shareholding interest. First-quarter 2022 production is expected to be 1.75 MMBOED to 1.79 MMBOED, essentially flat to fourth-quarter 2021 on a pro forma basis.

CNOOC

CNOOCs total capital expenditure for 2022 is budgeted at RMB 90 billion to RMB 100 billion. The capital expenditures for exploration, development, production and others will account for approximately 20%, 57%, 21% and 2% of the total capital expenditure, respectively.

In 2022, the Company plans to drill 227 offshore exploration wells, 132 onshore unconventional exploration wells, and acquire approximately 17 thousand square kilometers 3-Dimensional (3D) seismic data.

COSL

COSL has estimated that capex for the company in 2022 will be RMB4.16 billion ($656 million). The company indicated that 2022 capex will be mainly used for construction of production bases, renovation of the facilities, machinery and equipment as well as investment in technology research and development. Based on the current domestic and international orders secured by the company, it expects that workload of the four major segments, the geophysical acquisition and surveying services, the drilling services, the well services and the marine support services, will remain on a steady rise throughout 2022. 

EnQuest

Cash capital expenditure in 2022 is expected to be approximately $165 million, reflecting planned drilling programmes (three wells at Magnus, two wells at Golden Eagle and four wells at PM8/Seligi), with abandonment expenditure expected to be around $75 million. Average net Group production is expected to be between 44,000 Boepd and 51,000 Boepd.

ExxonMobil

ExxonMobil plans to maintain capital investments in the range of $20-$25 billion per year through 2027 with flexibility to adjust to adverse market conditions or changes in policy and technology for low-emissions projects.

As part of its plan, ExxonMobil has committed $15 billion for lower-emission investments through 2027. These investments will include a balance between projects to reduce greenhouse gas emissions from existing operations and increased investments in the Low Carbon Solutions business. 

Forza Petroleum

Forza Petroleum budgeted capital expenditures for 2022 are $81 million and dedicated exclusively to the Hawler license area.

Geopark

GeoPark's capital 2022 expenditures program of $160-180 million, will be allocated as follows:

• $90-100 million (or ~60%) to low-risk development growth focused on core Llanos 34 (GeoPark operated, 45% WI) and CPO-5 (GeoPark non-operated, 30% WI) blocks
• $70-80 million (or ~40%) to exploration of high potential, short-cycle and near-field projects on big proven acreage next to core Llanos 34 block plus other exploration targets in Colombia and Ecuador
• Using a $65-70 per bbl Brent base case, GeoPark expects to generate an operating netback of $400-450 million2, 2.5 times total capital expenditures, or 4+ times growth development capital

Gran Tierra

Gran Tierra’s planned 2022 capital program is a balanced program between development and optimization of existing assets and potentially high-impact exploration. Gran Tierra expects to allocate approximately 70% of its 2022 capital program towards development activities in its core assets: $70 million for the Acordionero field (14-16 development wells) in the Middle Magdalena Valley Basin and $40 million and $30 million respectively to the Costayaco (4-5 development wells) and Moqueta (3 development wells) fields in the Putumayo Basin. The Moqueta work program is expected to commence in the second half of 2022 and is planned to continue into 2023. The remaining 30% of the capital program is expected to be allocated toward exploration-related activities throughout the Company’s portfolio, including up to 6-7 new exploration wells: 4 wells in Colombia and 2-3 wells in Ecuador. The exploration program is designed to focus on short-cycle time, near-field prospects in proven basins with access to infrastructure.

The Company’s Base Case 2022 capital budget of $220-240 million is expected to be fully funded from the Base Case 2022 cash flow forecast of $270-290 million, based on an assumed $70.00/bbl Brent oil price.

Hess

Hess Corporation announced E&P capital and exploratory budget of $2.6 billion, of which approximately 80% will be allocated to offshore Guyana and the Bakken (onshore). In Guyana, the company will focus on the oil developments on the Stabroek Block, which have a Brent breakeven oil price of $25-$35, and continue the exploration and appraisal programme. Approximately $450 million have been allocated to the exploration programme which includes the drilling of 12 exploration and appraisal wells on the Stabroek Block, the Huron-1 well in the Green Canyon area of the Gulf of Mexico, and the Zanderij-1 on Block 42 in Suriname.

iGas

Canadian Capital Programme: Phase one of the Company's US$47 million 2022 Canadian Capital Budget is designed to combine efficient low-risk development drilling with strategic resource delineation and land capture. This includes development of the Company's extensive Glauconitic fairway, expansion of its key Clearwater position and demonstration of its prolific Simonette Montney resource. Phase one of the Capital Budget is well-underway with:

• Seven gross (five net) wells to be drilled across the Company's diversified portfolio in Central Alberta (Mannville liquids-rich gas), Marten Hills & Marten Creek (Clearwater oil) and Simonette (Montney oil), collectively expected to add approximately 2,420 boepd (55% oil and Natural Gas Liquids ("NGLs"))
• A recompletion and reactivation campaign targeting low-cost, high-return opportunities with less than one-year paybacks, estimated to add initial production of 600 boepd (50% oil and NGLs)
• Strategic field operations targeting improved opex, increased netbacks, and the systematic reduction of greenhouse gas ("GHG") emissions  

Jadestone Energy

Jadestone has set it capex for 2022 at $90-105 million, comprising mainly the Stag infill programme where the company plans to drill two infill wells. Jadestone is the 100% owner and operator of the Stag oilfield, offshore Australia.

Maha Energy

Maha Energy's Capital Plan aims to invest USD 47 million on various drilling and construction projects in Brazil, USA and Oman. The Capital Plan is to be funded through operating cash and proceeds from the 2021 financing. The Company estimates its Corporate operating costs for 2022 (including oil transportation costs) to range between $10 and $13 per BOE based on the annual average production range of 4,000 - 5,000 BOEPD.

Murphy Oil

Murphy Oil Corp announced planned capex in the range of $840 - 890 million for 2022, an increase from the capex guidance of $675 – 725 million announced for 2021. The capex guidance excludes Gulf of Mexico non-controlling interest. The company plans to spend approximately $330 mi?llion, or 38% of 2022 capex on Gulf of Mexico development drilling and field development projects. This includes bringing the major Khaleesi, Mormont, Samurai projects online as well as advancing the non-operated St. Malo waterflood project prior to its completion in 2023. Other plans include drilling an operated development well at Dalmatian with production scheduled to come online in 2023 and executing subsea tiebacks at non-operated Lucius. Approximately 8% of capex or $70 million has been allocated for offshore acreage in Canada, with $55 million earmarked to support the sanctioned asset life extension project for the non-operated Terra Nova FPSO and the remaining $15 million to support development drilling and field development at the non-operated Hibernia. For its 2022 exploration program, the company has earmarked 9% of its capex budget or $75 million, with the majority of spending designated for drilling exploration wells in Brazil, offshore Mexico and Brunei.

Panoro

Expenditure on capital and other non-recurring projects in 2022 is expected to be approximately USD 65 million, and includes approximately USD 6 million carried forward from 2021 guidance in relation to ongoing development of the Dussafu Marin Permit offshore Gabon (timing of spend) and USD 6 million in relation to exploration drilling at Block 2B offshore South Africa (pre-communicated deferral of well to H2 2022). The majority of planned 2022 expenditure is associated with the guided Hibiscus/Ruche field development and drilling offshore Gabon.

Petrobras

Petrobras has outlined investment plans of $68 billion in its Strategic Plan 2022-26, which increased by approx. 24% compared to the previous plan for the period 2021-25. Of the total capex allocation, 84% ($57.3 billion) has been earmarked for E&P. The company has indicated a strategy of maximising portfolio value through focus on exploration in deep and ultra-deep waters. 67% of the E&P capex would be directed towards pre-salt fields including Buzios, Tupi, Mero, Itapu, Jubarte, Sepia, Atapu, Berbigao, Sururu, Sapinhoa and its working interest in Block BM-C-33. The rest would be allocated towards post-salt developments such as Marlim, Marlim Sul / Marlim Leste, Roncador, Barracuda-Caratinga, and the Sergipe Deep Waters (SEAP). About $5.5 billion of the upstream capex will be used for exploration activity, with 58% of the total directed towards the Southeast basins (Campos, Santos and Espirito Santo), and another 38% to the equatorial margin. Petrobras expects oil output to increase from 2.1 million bpd in 2022 to 2.6 million bpd in 2026, and pre-salt production will continue to represent most of the company’s output, increasing from 70% of total output in 2022 to 79% in 2026. The company is also setting aside $2.8 billion to decarbonise operations, invest in bioproducts and in the diversification of its renewables business.

Shell

Cash capital expenditure for the full year 2022 is expected to be at the lower end of the $23 billion to $27 billion range.

Suncor

In 2022 the company expects to achieve capital expenditures of $4.7 billion, or $300 million (6%) lower than the previously announced ceiling of $5.0 billion, with a program largely focused on sustaining capital including planned maintenance and tailings optimizations. Economic capital spend will continue to be focused on advancing projects and investments that are expected to enhance value within our existing integrated asset base, and incrementally and sustainably grow annual free funds flow.

Woodside

Woodside Petroleum expects to hike its capital spending by about a third to $4 billion in 2022, as it advances oil and gas growth projects in Western Australia and Senegal as well as steps up efforts to start producing hydrogen.

KeyFacts Energy: CapEx news