Noble Energy, Inc. (NYSE:NBL) (“Noble Energy” or “the Company”)
today announced results for the second quarter of 2016, including a
reported net loss of $315 million, or $0.73 per diluted
share. The adjusted net loss
(1) for the
quarter was $103 million, or $0.24 per diluted share, which
excludes the impact of certain items typically not considered by
analysts in formulating estimates.
EBITDAX
(1) (earnings before interest expense,
income taxes, depreciation, depletion, and amortization, and
exploration expenses) and Adjusted EBITDAX
(1) were
$291 million and $597 million, respectively.
Capital expenditures for the quarter were $262 million, down
approximately 70 percent from the second quarter of last year
pro-forma for the Rosetta Resources Inc. merger. For the
second quarter of 2016, approximately 65 percent of the capital was
allocated to U.S. onshore and approximately 35 percent to global
offshore (including Gulf of Mexico and International).
The Company sold record quarterly volumes of 427 thousand
barrels of oil equivalent per day (MBoe/d) during the second
quarter of 2016, with crude oil, natural gas and natural gas
liquids (NGLs) all above original expectations. Total
sales volumes were higher by 43 percent compared to the second
quarter of 2015, or 18 percent on a pro-forma basis. Each
core area was higher period over period, with U.S. oil volumes up
31 thousand barrels per day. U.S. onshore sales volumes for
the quarter were a record 282 MBoe/d, up 15 percent compared to the
second quarter of 2015 pro-forma. Global offshore sales
volumes were 145 MBoe/d, an increase of 25 percent compared to the
second quarter of 2015. Liquids comprised 44 percent of
second quarter 2016 volumes, with 29 percent being crude oil and
condensate and 15 percent NGLs. Natural gas accounted for the
remaining 56 percent.
David L. Stover, Noble Energy’s Chairman, President and CEO,
commented, “Our strong asset base and operational execution set a
number of records in the second quarter. These results were
supported by additional capital efficiencies generated across our
business, both onshore in the U.S., through enhanced completions,
and offshore, with the delivery of new major projects. Recent
performance of the Texas assets has been particularly encouraging
and continues to demonstrate the high-quality of our positions in
both the Eagle Ford and the Delaware. We are delivering ahead of
our original expectations for the year, having enhanced both our
operating capabilities and our financial strength through the first
half of the year. Our performance sets us up for a strong
finish this year leading into 2017.”
All cost items for the quarter were in line with or below the
Company’s expectations. Lease operating expenses (LOE) in the
quarter were significantly lower at $3.07 per barrel of oil
equivalent (BOE), a reduction of 30 percent compared to the second
quarter of 2015 pro-forma. LOE per BOE benefited from record
sales volumes and lower than normal workover activity.
Transportation and gathering expenses totaled $2.97 per BOE
while depreciation, depletion and amortization expenses for the
quarter were $15.99 per BOE. General and Administrative costs
for the quarter were $107 million, down $25 million from the second
quarter of last year pro-forma. The Company’s income tax rate
for the quarter was 37 percent.
Adjustments to the Company’s net loss for the second quarter of
2016 included unrealized commodity derivative losses, primarily
related to existing crude oil hedging positions, as well as a loss
on sale from the divestiture of non-core properties in
Montana. Also included was a tax adjustment related to the
purchase price allocation for the Rosetta Resources Inc. merger
completed in the third quarter of 2015, as well as well costs
associated with the 2011 drilling of the Dolphin well offshore
Israel due to the expiration of the associated exploration
license.
OPERATIONS UPDATETEXAS (EAGLE FORD AND
PERMIAN)Record quarterly sales volumes of 74 MBoe/d were
achieved in the second quarter of 2016, an increase of 17 percent
from the second quarter of 2015 on a pro-forma basis and up 23
percent from the first quarter of 2016. Liquids represented
62 percent of the total (25 percent crude oil and condensate and 37
percent NGLs), while natural gas accounted for the remaining 38
percent. Eagle Ford production made up 90 percent of the
volumes with the Permian delivering the remaining 10 percent.
Highlights include:
- The Company brought one well online in the Wolfcamp A interval
in the Permian’s Delaware Basin. The Calamity Jane 2101H
well, with a lateral length of 4,859 feet, was completed using
slickwater and 3,000 pounds of proppant per lateral foot. To
date, the well has achieved a maximum IP-30 rate of 2,541 Boe/d (or
523 Boe/d per thousand lateral feet) with 57 percent oil. On
a normalized basis (5,000 foot lateral well), the well is
outperforming the 700 MBoe type curve by more than 75 percent.
- In the second quarter, Noble Energy commenced production on
seven Lower Eagle Ford wells in the Gates Ranch area. Six of
the wells were located in South Gates Ranch and had a lateral
spacing of approximately 500 feet, an average lateral length of
7,240 feet, and an average IP-30 of 3,954 Boe/d (or 547 Boe/d per
thousand lateral feet). The wells had proppant concentrations
of approximately 2,000 pounds per lateral foot and cluster spacing
of 40 feet. On average and normalized for lateral length, the
IP-30 rates have outperformed a 3 MMBoe type curve (for a 5,000
foot lateral) over their first 30 days of production.
- In late March, the Company brought on production six additional
Lower Eagle Ford wells in the Gates Ranch area. Five of the
wells were located in South Gates Ranch and tested lateral spacing
of 1,000 feet or more, had an average lateral length of 4,570 feet,
and resulted in an average IP-30 rate of 3,993 Boe/d (or 878 Boe/d
per thousand lateral feet). On average, the wells had
proppant concentrations of over 2,000 pounds per lateral foot and
cluster spacing of 20 feet. Normalized for lateral length,
these wells have outperformed a 3 MMBoe type curve (for a 5,000
foot lateral) by approximately 60 percent over the first 90
days.
- There were 46 wells drilled but uncompleted (including 31 in
the Eagle Ford and 15 in the Delaware) at the end of the
quarter.
DJ BASINSales volumes averaged 113 MBoe/d in
the second quarter of 2016, an increase of nearly 5 percent from
the second quarter of 2015. Liquids represented 66 percent of
DJ Basin volumes (46 percent crude oil and condensate and 20
percent NGLs) and 34 percent was natural gas. Combined
volumes for Wells Ranch and East Pony averaged 57 MBoe/d during the
quarter, up 23 percent compared to the second quarter of
2015. Volumes in the second quarter were impacted by a
planned turn-around at the Wells Ranch central processing facility
as well as unplanned third-party processing facility downtime.
Highlights include:
- Average well costs for normalized long laterals with enhanced
completions were reduced to $2.6 million in Wells Ranch.
- Drilled 26 wells at an average lateral length of over 8,100
feet, with all of the wells drilled in the second quarter located
in Wells Ranch (88 percent) and East Pony (12 percent).
Nearly all of the wells drilled used the monobore technique.
Delivered average spud to rig release drilling days of five, seven
and eight for standard (4,500 feet), medium (6,000 feet) and long
(9,000 feet) length lateral wells, respectively.
- Commenced production on 25 wells, with an average lateral
length of 8,270 feet. Approximately half of the wells that
commenced production in the quarter were brought on line in May,
with the remainder in June. More than two-thirds of the wells
put into production in the quarter utilized slickwater fluid with
proppant concentrations of 1,000 pounds or more per lateral foot.
- Ten wells brought online in the quarter within the Company’s
Mustang IDP, seven of which utilized enhanced completions, have
significantly outperformed expectations. These are the
Company’s first enhanced completions within the DJ Basin outside of
the Wells Ranch and East Pony areas.
- Added approximately 11,700 net acres in Wells Ranch, a 20
percent increase, in exchange for approximately 13,500 net acres
primarily out of the Company’s Bronco area. The improved
contiguous acreage position in Wells Ranch enhances the IDP’s value
by increasing long lateral locations and optimizing the use of
existing infrastructure.
- Completed the initial close for the Greeley Crescent acreage
sale, receiving $486 million proceeds within the second
quarter. The Company expects to receive the remaining $19
million in a final closing around the end of the year.
- The Company exited the quarter with 36 wells drilled but
uncompleted.
MARCELLUS SHALESales volumes in the Marcellus
Shale averaged 546 million cubic feet of natural gas equivalent per
day (MMcfe/d) in the second quarter of 2016, an increase of 28
percent over the same quarter of last year and down approximately 5
percent versus the first quarter of 2016. Natural gas
represented 91 percent of the volumes sold, with the majority of
the remainder composed of NGLs.
Highlights include:
- Commenced production on 16 non-operated wells within the Joint
Venture.
- Solid well performance continues at the operated Rich Hill 23
pad in Greene County, Pennsylvania. The combined production
of the eight wells was approximately 95 MMcf/d, essentially flat
after six months of production.
- The non-operated Green Hill 53 pad, also located in Greene
County, Pennsylvania, has averaged 80 MMcf/d over the first 60 days
of production from nine wells.
- Exited the quarter with 79 wells drilled but uncompleted in the
Joint Venture.
- CONE Midstream Partners gathered gross volumes averaging
approximately 1.2 billion cubic feet per day during the quarter, an
increase of nearly 32 percent from the same quarter in the previous
year.
GULF OF MEXICOSales volumes in the Gulf of
Mexico averaged nearly 27 MBoe/d, an increase of 125 percent
compared to the same quarter of last year. Crude oil and
condensate represented 84 percent of second quarter 2016 volumes,
with 5 percent NGLs and 11 percent natural gas.
Highlights include:
- Combined production from Big Bend and Dantzler, which commenced
production late in 2015, contributed 16 MBoe/d, net to Noble
Energy.
- The Company was named the successor operator of the Thunder
Hawk production facility, expected to become effective within the
third quarter, subject to regulatory approval.
- The Gunflint oil development commenced production in
mid-July. The two-well field is ramping up and is anticipated
to reach a minimum gross production of 20 MBoe/d. The net
amount to Noble Energy is expected to be at least 5 MBoe/d, with
potential for additional volumes dependent upon available capacity
at the third-party host facility.
- Drilling operations at the Katmai 2 appraisal well, located in
Green Canyon 39, have been temporarily abandoned as a result of
encountering high pressure in the untested fault block. Plans
to appraise the discovery at a future date are being
assessed.
EASTERN MEDITERRANEANIsrael natural gas sales
volumes averaged 276 MMcf/d, a second quarter record for the
Company and an increase of 28 percent versus the second quarter of
last year. The higher volumes were primarily driven by
greater displacement of coal for natural gas in the power
generation sector and growth from industrial customers, as well as
warmer weather in the quarter.
Highlights include:
- Continued strong operations and reservoir performance at Tamar,
combined with uninterrupted production for the second consecutive
quarter.
- Executed agreement to sell 3 percent working interest in Tamar
in early July for $369 million pre-tax (implied $12.3 billion gross
valuation).
- Continued progress in marketing gas from the Leviathan
field. Executed domestic gas sales contracts for Leviathan
now totaling approximately 100 MMcf/d.
- Received approval from the Israeli Government for the Leviathan
Plan of Development, authorizing Leviathan to be developed as a
subsea tie-back to a shallow water platform in northern
Israel.
- Commenced front-end engineering and design for the Leviathan
production platform.
WEST AFRICASales volumes in West Africa
averaged 72 MBoe/d, containing 40 percent crude oil and condensate,
six percent NGLs, and 54 percent natural gas.
Highlights include:
- Aseng reached a milestone 75 million barrels of cumulative oil
production. Strong safety performance at both Aseng and Alen
was demonstrated by reaching over two years of operations without a
lost-time incident.
- Commenced production in July from the non-operated B3
compression platform at the Alba field. The project, which
will enhance full-field recovery, is expected to support field
production plateau of approximately 200 MBoe/d gross, 55 MBoe/d net
to Noble Energy (including recoveries at the Alba LPG Plant).
The compression project was executed on time and on budget.
- A 3D multi-client seismic survey was completed in Block F15
offshore Gabon. The Company is currently processing the data
and evaluating the prospectivity of the block.
UPDATED GUIDANCEDriven by continued performance
improvement and capital efficiency momentum achieved within the
first half of 2016, Noble Energy has raised its full-year sales
volume guidance while maintaining its existing capital expenditure
outlook. The Company anticipates full-year 2016 capital
expenditures to be less than $1.5 billion while full-year 2016
sales volumes have been increased to an average of 415
MBoe/d. On a divestment adjusted basis, (accounting for 3
MBoe/d in asset sales), the increase represents 28 MBoe/d, or a
total of 10 million barrels of oil equivalent. This equates
to more than a 7 percent raise from the Company’s original
full-year expectation.
Noble Energy expects third quarter capital expenditures between
$400 million and $450 million, with approximately 80 percent of the
amount targeted to the U.S. onshore assets. For the majority
of the third quarter and the remainder of the year, the Company
will be operating a total of four rigs onshore in the U.S.,
including two within the DJ Basin, and one in each of the Eagle
Ford and the Delaware.
Sales volumes for the third quarter are anticipated to be
between 405 MBoe/d and 415 MBoe/d, with the difference in volumes
compared to the second quarter driven primarily by the timing of
wells commencing production in the Eagle Ford. Volumes in the
Marcellus business unit are estimated to increase versus the second
quarter. In the DJ Basin, vertical production is expected to
be lower, while horizontal production is anticipated to hold
relatively flat. In addition, the sale of the Company’s
Montana assets and Greeley Crescent areas will lower volumes by
approximately two MBoe/d compared to the second quarter of this
year. Volumes in the Gulf of Mexico are anticipated to be
equivalent with second quarter levels, while West Africa volumes
will be lower as sales liftings are expected to be less than
production. Israel volumes are expected to be higher than the
second quarter due to seasonal and underlying demand.
Additional detailed guidance for the remainder of the year is
provided in the Company’s supplemental slides for the quarterly
webcast. The slides are available on the Company’s
website.
(1) A Non-GAAP measure, see attached Reconciliation
Schedules
WEBCAST INFORMATION
Noble Energy, Inc. will host a live audio webcast
at 9:00 a.m. Central time today. The webcast link is
accessible on the ‘Investors’ page at www.nobleenergyinc.com.
A replay will be available on the website.
Noble Energy (NYSE:NBL) is an independent oil
and natural gas exploration and production company with a
diversified high-quality portfolio of both U.S. unconventional and
global offshore conventional assets spanning three
continents. Founded more than 80 years ago, the company is
committed to safely and responsibly delivering our purpose:
Energizing the World, Bettering People’s Lives®. For more
information, visit www.nobleenergyinc.com.
This news release contains certain “forward-looking statements”
within the meaning of federal securities law. Words such as
“anticipates”, “believes”, “expects”, “intends”, “will”, “should”,
“may”, “estimates”, and similar expressions may be used to identify
forward-looking statements. Forward-looking statements are
not statements of historical fact and reflect Noble Energy’s
current views about future events. They may include estimates
of oil and natural gas reserves, estimates of future production,
assumptions regarding future oil and natural gas pricing, planned
drilling activity, future results of operations, projected cash
flow and liquidity, business strategy and other plans and
objectives for future operations. No assurances can be given
that the forward-looking statements contained in this news release
will occur as projected and actual results may differ materially
from those projected. Forward-looking statements are based on
current expectations, estimates and assumptions that involve a
number of risks and uncertainties that could cause actual results
to differ materially from those projected. These risks
include, without limitation, the volatility in commodity prices for
crude oil and natural gas, the presence or recoverability of
estimated reserves, the ability to replace reserves, environmental
risks, drilling and operating risks, exploration and development
risks, competition, government regulation or other actions, the
ability of management to execute its plans to meet its goals and
other risks inherent in Noble Energy’s business that are discussed
in its most recent annual report on Form 10-K and in other reports
on file with the Securities and Exchange Commission (“SEC”). These
reports are also available from Noble Energy’s offices or website,
http://www.nobleenergyinc.com. Forward-looking statements are
based on the estimates and opinions of management at the time the
statements are made. Noble Energy does not assume any
obligation to update forward-looking statements should
circumstances, management’s estimates, or opinions change.
This news release also contains certain non-GAAP measures of
financial performance that management believes are good tools for
internal use and the investment community in evaluating Noble
Energy’s overall financial performance. These non-GAAP
measures are broadly used to value and compare companies in the
crude oil and natural gas industry. Please see the attached
schedules for reconciliations of the differences between any
historical non-GAAP measures used in this news release and the most
directly comparable GAAP financial measures.
The Securities and Exchange Commission requires oil and gas
companies, in their filings with the SEC, to disclose proved
reserves that a company has demonstrated by actual production or
conclusive formation tests to be economically and legally
producible under existing economic and operating conditions. The
SEC permits the optional disclosure of probable and possible
reserves, however, we have not disclosed the Company's probable and
possible reserves in our filings with the SEC. We use certain terms
in this news release, such as “MBoe type curve”, “MMBoe type curve”
and "type curve”, which are by their nature more speculative than
estimates of proved, probable and possible reserves and accordingly
are subject to substantially greater risk of being actually
realized. The SEC guidelines strictly prohibit us from including
these estimates in filings with the SEC. Investors are urged to
consider closely the disclosures and risk factors in our most
recent annual report on Form 10-K and in other reports on file with
the SEC, available from Noble Energy's offices or website,
http://www.nobleenergyinc.com.
|
Schedule 1 |
Noble Energy, Inc. |
Summary Statement of Operations |
(in millions, except per share amounts,
unaudited) |
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Revenues |
|
|
|
|
|
|
|
Crude Oil
and Condensate |
$ |
465 |
|
|
$ |
483 |
|
|
$ |
829 |
|
|
$ |
914 |
|
Natural
Gas |
282 |
|
|
215 |
|
|
569 |
|
|
492 |
|
Natural Gas
Liquids (1) |
76 |
|
|
34 |
|
|
130 |
|
|
75 |
|
Income from
Equity Method Investees |
24 |
|
|
6 |
|
|
43 |
|
|
24 |
|
Total
Revenues |
847 |
|
|
738 |
|
|
1,571 |
|
|
1,505 |
|
Operating
Expenses |
|
|
|
|
|
|
|
Lease
Operating Expense |
119 |
|
|
129 |
|
|
281 |
|
|
286 |
|
Production
and Ad Valorem Taxes |
40 |
|
|
28 |
|
|
43 |
|
|
61 |
|
Transportation and Gathering Expense (1) |
115 |
|
|
61 |
|
|
222 |
|
|
122 |
|
Marketing
and Processing Expense, Net |
15 |
|
|
12 |
|
|
37 |
|
|
22 |
|
Exploration
Expense |
89 |
|
|
41 |
|
|
252 |
|
|
106 |
|
Depreciation, Depletion and Amortization |
622 |
|
|
451 |
|
|
1,239 |
|
|
905 |
|
General and
Administrative |
107 |
|
|
104 |
|
|
198 |
|
|
198 |
|
Other
Operating (Income) Expense, Net |
2 |
|
|
73 |
|
|
(17 |
) |
|
99 |
|
Total
Operating Expenses |
1,109 |
|
|
899 |
|
|
2,255 |
|
|
1,799 |
|
Operating
Loss |
(262 |
) |
|
(161 |
) |
|
(684 |
) |
|
(294 |
) |
Other
Expense |
|
|
|
|
|
|
|
Loss (Gain)
on Commodity Derivative Instruments |
151 |
|
|
87 |
|
|
107 |
|
|
(63 |
) |
Interest,
Net of Amount Capitalized |
78 |
|
|
54 |
|
|
157 |
|
|
112 |
|
Other
Non-Operating Expense (Income), Net |
7 |
|
|
(9 |
) |
|
3 |
|
|
(9 |
) |
Total Other
Expense |
236 |
|
|
132 |
|
|
267 |
|
|
40 |
|
Loss Before Income
Taxes |
(498 |
) |
|
(293 |
) |
|
(951 |
) |
|
(334 |
) |
Income Tax Benefit |
(183 |
) |
|
(184 |
) |
|
(349 |
) |
|
(203 |
) |
Net
Loss |
$ |
(315 |
) |
|
$ |
(109 |
) |
|
$ |
(602 |
) |
|
$ |
(131 |
) |
Loss Per
Share |
|
|
|
|
|
|
|
Loss Per Share, Basic |
$ |
(0.73 |
) |
|
$ |
(0.28 |
) |
|
$ |
(1.40 |
) |
|
$ |
(0.35 |
) |
Loss Per Share,
Diluted |
$ |
(0.73 |
) |
|
$ |
(0.28 |
) |
|
$ |
(1.40 |
) |
|
$ |
(0.35 |
) |
|
|
|
|
|
|
|
|
Weighted Average Number of
Shares Outstanding |
|
|
|
|
|
|
|
Basic |
430 |
|
|
387 |
|
|
429 |
|
|
378 |
|
Diluted |
430 |
|
|
387 |
|
|
429 |
|
|
378 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Certain
of our revenue received from purchasers was historically presented
with deductions for transportation, gathering, fractionation or
processing costs. Beginning in 2016, we have changed our
presentation to no longer include these expenses as deductions from
revenue. These costs are now included within transportation and
gathering expense and prior year amounts have been reclassified to
conform to the current presentation. |
|
These
financial statements should be read in conjunction with the
financial statements and the accompanying notes and other
information included in Noble Energy's Quarterly Report on Form
10-Q to be filed with the Securities and Exchange Commission on
August 3, 2016. |
|
On July 20,
2015, we completed the merger with Rosetta Resources Inc. (Rosetta
or Rosetta Merger) and the results of operations attributable to
Rosetta are included in our consolidated statement of operations
beginning on July 21, 2015. The results of these operations
attributable to Rosetta will affect the comparability of our
financial results to prior periods. |
|
|
Schedule 2 |
Noble Energy, Inc. |
Condensed Balance Sheets |
(in millions, unaudited) |
|
|
June 30,2016 |
|
December 31, 2015 |
ASSETS |
|
|
|
Current
Assets |
|
|
|
Cash and
Cash Equivalents |
$ |
1,300 |
|
|
$ |
1,028 |
|
Accounts
Receivable, Net |
476 |
|
|
450 |
|
Commodity
Derivative Assets |
229 |
|
|
582 |
|
Other
Current Assets |
184 |
|
|
216 |
|
Total
Current Assets |
2,189 |
|
|
2,276 |
|
Net Property, Plant and
Equipment |
19,734 |
|
|
21,300 |
|
Other Noncurrent
Assets |
593 |
|
|
620 |
|
Total
Assets |
$ |
22,516 |
|
|
$ |
24,196 |
|
LIABILITIES AND
SHAREHOLDERS' EQUITY |
|
|
|
Current
Liabilities |
|
|
|
Accounts
Payable - Trade |
$ |
780 |
|
|
$ |
1,128 |
|
Other
Current Liabilities |
595 |
|
|
677 |
|
Total
Current Liabilities |
1,375 |
|
|
1,805 |
|
Long-Term Debt |
7,868 |
|
|
7,976 |
|
Deferred Income Taxes,
Noncurrent |
2,387 |
|
|
2,826 |
|
Other Noncurrent
Liabilities |
1,173 |
|
|
1,219 |
|
Total
Liabilities |
12,803 |
|
|
13,826 |
|
Total Shareholders’
Equity |
9,713 |
|
|
10,370 |
|
Total
Liabilities and Shareholders’ Equity |
$ |
22,516 |
|
|
$ |
24,196 |
|
|
These
financial statements should be read in conjunction with the
financial statements and the accompanying notes and other
information included in Noble Energy's Quarterly Report on Form
10-Q to be filed with the Securities and Exchange Commission on
August 3, 2016. |
|
|
Schedule
3 |
Noble
Energy, Inc. |
Condensed
Statement of Cash Flows |
(in
millions, unaudited) |
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Cash Flows From
Operating Activities |
|
|
|
|
|
|
|
Net
Loss |
$ |
(315 |
) |
|
$ |
(109 |
) |
|
$ |
(602 |
) |
|
$ |
(131 |
) |
Adjustments
to Reconcile Net Loss to Net Cash Provided by Operating
Activities |
|
|
|
|
|
|
|
Depreciation, Depletion and Amortization |
622 |
|
|
451 |
|
|
1,239 |
|
|
905 |
|
Asset
Impairments |
— |
|
|
15 |
|
|
— |
|
|
43 |
|
Dry Hole
Cost |
27 |
|
|
— |
|
|
114 |
|
|
19 |
|
Gain on
Extinguishment of Debt |
— |
|
|
— |
|
|
(80 |
) |
|
— |
|
Purchase
Price Allocation Adjustment |
(25 |
) |
|
— |
|
|
(25 |
) |
|
— |
|
Loss on
Asset Due to Terminated Contract |
5 |
|
|
— |
|
|
47 |
|
|
— |
|
Deferred
Income Tax Benefit |
(228 |
) |
|
(283 |
) |
|
(414 |
) |
|
(312 |
) |
(Income)
Loss from Equity Method Investees, Net of Dividends |
(6 |
) |
|
22 |
|
|
(9 |
) |
|
4 |
|
Loss (Gain)
on Commodity Derivative Instruments |
151 |
|
|
87 |
|
|
107 |
|
|
(63 |
) |
Net Cash
Received in Settlement of Commodity Derivative Instruments |
144 |
|
|
187 |
|
|
322 |
|
|
397 |
|
Loss on
Divestitures |
23 |
|
|
(1 |
) |
|
23 |
|
|
— |
|
Stock Based
Compensation |
20 |
|
|
17 |
|
|
40 |
|
|
38 |
|
Other
Adjustments for Noncash Items Included in Net Loss |
16 |
|
|
22 |
|
|
59 |
|
|
32 |
|
Net Changes
in Working Capital |
(245 |
) |
|
17 |
|
|
(381 |
) |
|
34 |
|
Net Cash
Provided by Operating Activities |
189 |
|
|
425 |
|
|
440 |
|
|
966 |
|
Cash Flows From
Investing Activities |
|
|
|
|
|
|
|
Additions to
Property, Plant and Equipment |
(316 |
) |
|
(787 |
) |
|
(812 |
) |
|
(1,898 |
) |
Additions to
Equity Method Investments |
— |
|
|
(21 |
) |
|
(6 |
) |
|
(65 |
) |
Proceeds
from Divestitures and Other |
529 |
|
|
32 |
|
|
767 |
|
|
151 |
|
Net Cash
Provided by (Used in) Investing Activities |
213 |
|
|
(776 |
) |
|
(51 |
) |
|
(1,812 |
) |
Cash Flows From
Financing Activities |
|
|
|
|
|
|
|
Dividends
Paid, Common Stock |
(45 |
) |
|
(70 |
) |
|
(86 |
) |
|
(134 |
) |
Proceeds
from Issuance of Shares of Common Stock to Public, Net of Offering
Costs |
— |
|
|
— |
|
|
— |
|
|
1,112 |
|
Proceeds
From Long-Term Debt, Net |
— |
|
|
— |
|
|
17 |
|
|
— |
|
Repayment of
Capital Lease Obligation |
(14 |
) |
|
(10 |
) |
|
(27 |
) |
|
(29 |
) |
Other |
4 |
|
|
— |
|
|
(21 |
) |
|
(8 |
) |
Net Cash (Used
in) Provided by Financing Activities |
(55 |
) |
|
(80 |
) |
|
(117 |
) |
|
941 |
|
Increase
(Decrease) in Cash and Cash Equivalents |
347 |
|
|
(431 |
) |
|
272 |
|
|
95 |
|
Cash and Cash
Equivalents at Beginning of Period |
953 |
|
|
1,709 |
|
|
1,028 |
|
|
1,183 |
|
Cash and Cash
Equivalents at End of Period |
$ |
1,300 |
|
|
$ |
1,278 |
|
|
$ |
1,300 |
|
|
$ |
1,278 |
|
|
These financial statements should be
read in conjunction with the financial statements and the
accompanying notes and other information included in Noble Energy's
Quarterly Report on Form 10-Q to be filed with the Securities and
Exchange Commission on August 3, 2016. |
|
On July 20, 2015, we completed the
merger with Rosetta and the associated cash flows are included in
our operations beginning on July 21, 2015. The results of
these cash flows attributable to Rosetta will affect the
comparability of our results to prior periods. |
|
|
Schedule 4 |
Noble Energy, Inc. |
Volume and Price Statistics |
(unaudited) |
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
Sales
Volumes |
2016 |
|
2015 |
|
2016 |
|
2015 |
Crude Oil and
Condensate (MBbl/d) |
|
|
|
|
|
|
|
United
States |
96 |
|
|
65 |
|
|
99 |
|
|
69 |
|
Equatorial
Guinea |
27 |
|
|
31 |
|
|
27 |
|
|
30 |
|
Other
International |
— |
|
|
— |
|
|
— |
|
|
1 |
|
Total
consolidated operations |
123 |
|
|
96 |
|
|
126 |
|
|
100 |
|
Equity
method investee - Equatorial Guinea |
1 |
|
|
1 |
|
|
1 |
|
|
1 |
|
Total |
124 |
|
|
97 |
|
|
127 |
|
|
101 |
|
Natural Gas
Liquids (MBbl/d) |
|
|
|
|
|
|
|
United
States |
59 |
|
|
27 |
|
|
56 |
|
|
26 |
|
Equity
method investee - Equatorial Guinea |
5 |
|
|
3 |
|
|
4 |
|
|
4 |
|
Total |
64 |
|
|
30 |
|
|
60 |
|
|
30 |
|
Natural Gas
(MMcf/d) |
|
|
|
|
|
|
|
United
States |
924 |
|
|
613 |
|
|
917 |
|
|
616 |
|
Israel |
276 |
|
|
215 |
|
|
271 |
|
|
229 |
|
Equatorial
Guinea |
233 |
|
|
202 |
|
|
214 |
|
|
216 |
|
Total |
1,433 |
|
|
1,030 |
|
|
1,402 |
|
|
1,061 |
|
Total Sales
Volumes (MBoe/d) |
|
|
|
|
|
|
|
United
States |
309 |
|
|
194 |
|
|
308 |
|
|
198 |
|
Israel |
46 |
|
|
36 |
|
|
45 |
|
|
38 |
|
Equatorial
Guinea |
66 |
|
|
65 |
|
|
63 |
|
|
66 |
|
Other
International |
— |
|
|
— |
|
|
— |
|
|
1 |
|
Total
consolidated operations |
421 |
|
|
295 |
|
|
416 |
|
|
303 |
|
Equity
method investee - Equatorial Guinea |
6 |
|
|
4 |
|
|
6 |
|
|
6 |
|
Total sales
volumes (MBoe/d) |
427 |
|
|
299 |
|
|
422 |
|
|
309 |
|
|
|
|
|
|
|
|
|
Total sales
volumes (MBoe) |
38,867 |
|
|
27,233 |
|
|
76,721 |
|
|
55,897 |
|
|
|
|
|
|
|
|
|
Price Statistics -
Realized Prices |
|
|
|
|
|
|
|
Crude Oil and
Condensate ($/Bbl)(1) |
|
|
|
|
|
|
|
United
States |
$ |
40.64 |
|
|
$ |
52.44 |
|
|
$ |
35.22 |
|
|
$ |
48.20 |
|
Equatorial
Guinea |
44.55 |
|
|
60.02 |
|
|
39.53 |
|
|
54.97 |
|
Other
International |
— |
|
|
— |
|
|
— |
|
|
55.52 |
|
Total |
$ |
41.51 |
|
|
$ |
54.91 |
|
|
$ |
36.14 |
|
|
$ |
50.29 |
|
Natural Gas
Liquids ($/Bbl)(1) |
|
|
|
|
|
|
|
United
States |
$ |
14.10 |
|
|
$ |
13.71 |
|
|
$ |
12.73 |
|
|
$ |
16.11 |
|
Natural Gas
($/Mcf)(1) |
|
|
|
|
|
|
|
United
States |
$ |
1.75 |
|
|
$ |
1.90 |
|
|
$ |
1.82 |
|
|
$ |
2.31 |
|
Israel |
5.15 |
|
|
5.34 |
|
|
5.17 |
|
|
5.40 |
|
Equatorial
Guinea |
0.27 |
|
|
0.27 |
|
|
0.27 |
|
|
0.27 |
|
Total |
$ |
2.16 |
|
|
$ |
2.30 |
|
|
$ |
2.23 |
|
|
$ |
2.56 |
|
|
(1) Average realized prices do not
include gains or losses on commodity derivative instruments.On July
20, 2015, we completed the merger with Rosetta and the associated
volumes and price statistics are included in our operations
beginning on July 21, 2015. The results of these volumes and
prices attributable to Rosetta will affect the comparability of our
results to prior periods. |
|
|
Schedule 5 |
Noble Energy, Inc. |
Reconciliation of Net Loss (GAAP) to Adjusted
(Loss) Income (Non-GAAP) |
(in millions, except per share amounts,
unaudited) |
|
Adjusted
(loss) income (Non- GAAP) should not be considered an alternative
to, or more meaningful than, net loss (GAAP) or any other measure
as reported in accordance with GAAP. Our management believes, and
certain investors may find, that adjusted (loss) income is
beneficial in evaluating our operating and financial performance
because it eliminates the impact of certain noncash and/or
nonrecurring items that management does not consider to be
indicative of our performance from period to period. We believe
this Non-GAAP measure is used by analysts and investors to evaluate
and compare our operating and financial performance across periods.
As a performance measure, adjusted (loss) income may be useful for
comparison of earnings to forecasts prepared by analysts and other
third parties. However, our presentation of adjusted (loss) income
may not be comparable to similar measures of other companies in our
industry. |
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Net Loss (GAAP) |
$ |
(315 |
) |
|
$ |
(109 |
) |
|
$ |
(602 |
) |
|
$ |
(131 |
) |
Adjustments to Net Loss |
|
|
|
|
|
|
|
Loss on
Commodity Derivative Instruments, Net of Cash Settlements
[1] |
295 |
|
|
274 |
|
|
429 |
|
|
334 |
|
Loss on
Asset Due to Terminated Contract |
5 |
|
|
— |
|
|
47 |
|
|
— |
|
Purchase
Price Allocation Adjustment [2] |
(25 |
) |
|
— |
|
|
(25 |
) |
|
— |
|
Gain on Debt
Extinguishment [3] |
— |
|
|
— |
|
|
(80 |
) |
|
— |
|
Well Cost
Related to Expiration of Exploration License
[4] |
27 |
|
|
— |
|
|
27 |
|
|
— |
|
Loss (Gain)
on Divestitures |
23 |
|
|
(1 |
) |
|
23 |
|
|
— |
|
Asset
Impairments |
— |
|
|
15 |
|
|
— |
|
|
43 |
|
Other
Adjustments [5] |
8 |
|
|
46 |
|
|
23 |
|
|
49 |
|
Total
Adjustments Before Tax |
333 |
|
|
334 |
|
|
444 |
|
|
426 |
|
Current
Income Tax Effect of Adjustments [6] |
(13 |
) |
|
(9 |
) |
|
— |
|
|
(9 |
) |
Deferred
Income Tax Effect of Adjustments [6] |
(108 |
) |
|
(115 |
) |
|
(173 |
) |
|
(175 |
) |
Adjusted (Loss) Income
(Non-GAAP) |
$ |
(103 |
) |
|
$ |
101 |
|
|
$ |
(331 |
) |
|
$ |
111 |
|
|
|
|
|
|
|
|
|
Net Loss Per Share, Diluted (GAAP) |
$ |
(0.73 |
) |
|
$ |
(0.28 |
) |
|
$ |
(1.40 |
) |
|
$ |
(0.35 |
) |
Adjusted (Loss) Income Per Share, Diluted
(Non-GAAP) |
$ |
(0.24 |
) |
|
$ |
0.26 |
|
|
$ |
(0.77 |
) |
|
$ |
0.29 |
|
|
|
|
|
|
|
|
|
Weighted Average Number of Shares Outstanding,
Diluted |
430 |
|
|
390 |
|
|
429 |
|
|
382 |
|
|
|
|
NOTE: |
|
On July 20, 2015, we
completed the merger with Rosetta and the results of operations
attributable to Rosetta are included in our consolidated statement
of operations beginning on July 21, 2015. The results of these
operations attributable to Rosetta will affect the comparability of
our financial results to prior periods. |
|
|
|
[1] |
|
Many factors impact our
gain or loss on commodity derivative instruments, net of cash
settlements, including: increases and decreases in the commodity
forward price curves compared to our executed hedging arrangements;
increases in hedged future revenues; and the mix of hedge
arrangements between NYMEX WTI, Dated Brent and NYMEX HH
commodities. These gains or losses on commodity derivative
instruments, net of cash settlements, recognized in the current
period, will be realized in the future when cash settlement
occurs. |
|
|
|
[2] |
|
Amount relates to a tax
adjustment recorded to the purchase price allocation related to the
Rosetta Merger. |
|
|
|
[3] |
|
Amount relates to the
early tendering of senior notes assumed in the Rosetta Merger. |
|
|
|
[4] |
|
Amount relates to the
license from our 2011 Dolphin discovery in Eastern
Mediterranean. |
|
|
|
[5] |
|
Amount for 2016 relates to
loss on sale of other assets, stacked drilling rig charges, and
deferred compensation plan; amount for 2015 relates to deferred
compensation plan, stacked drilling rig charges, corporate
restructuring, and pension plan termination. |
|
|
|
[6] |
|
Amount represents the
income tax effect of adjustments, determined for each major tax
jurisdiction for each adjusting item, as well as the change in the
indefinite reinvestment assertion related to accumulated
undistributed earnings of foreign subsidiaries. |
|
|
|
|
Schedule 6 |
Noble Energy, Inc. |
Reconciliation of Net Loss (GAAP) to EBITDAX
(Non-GAAP) and Adjusted EBITDAX (Non-GAAP) |
(in millions, unaudited) |
|
Earnings
Before Interest Expense, Income Taxes, Depreciation, Depletion and
Amortization, and Exploration Expenses (EBITDAX) (Non-GAAP) and
Adjusted EBITDAX (Non- GAAP) should not be considered an
alternative to, or more meaningful than, net loss (GAAP) or any
other measure as reported in accordance with GAAP. Our management
believes, and certain investors may find, that EBITDAX and Adjusted
EBITDAX is beneficial in evaluating our operating and financial
performance because it eliminates the impact of certain noncash
and/or nonrecurring items that management does not consider to be
indicative of our performance from period to period. We believe
these Non-GAAP measures are used by analysts and investors to
evaluate and compare our operating and financial performance across
periods. As a performance measure, EBITDAX and Adjusted EBITDAX may
be useful for comparison of earnings to forecasts prepared by
analysts and other third parties. However, our presentation of
EBITDAX and Adjusted EBITDAX may not be comparable to similar
measures of other companies in our industry. |
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Net Loss (GAAP) |
$ |
(315 |
) |
|
$ |
(109 |
) |
|
$ |
(602 |
) |
|
$ |
(131 |
) |
Adjustments to Net Loss |
|
|
|
|
|
|
|
Depreciation, Depletion, and Amortization |
622 |
|
|
451 |
|
|
1,239 |
|
|
905 |
|
Exploration
Expense |
89 |
|
|
41 |
|
|
252 |
|
|
106 |
|
Interest,
Net of Amount Capitalized |
78 |
|
|
54 |
|
|
157 |
|
|
112 |
|
Current
Income Tax Expense |
45 |
|
|
99 |
|
|
65 |
|
|
109 |
|
Deferred
Income Tax Benefit |
(228 |
) |
|
(283 |
) |
|
(414 |
) |
|
(312 |
) |
EBITDAX
(Non-GAAP) |
$ |
291 |
|
|
$ |
253 |
|
|
$ |
697 |
|
|
$ |
789 |
|
|
|
|
|
|
|
|
|
Earnings
Adjustments, Before Tax [1] |
306 |
|
|
334 |
|
|
417 |
|
|
426 |
|
Adjusted EBITDAX (Non-GAAP) |
$ |
597 |
|
|
$ |
587 |
|
|
$ |
1,114 |
|
|
$ |
1,215 |
|
NOTE: |
On July 20, 2015, we
completed the merger with Rosetta and the results of operations
attributable to Rosetta are included in our consolidated income
statement of operations beginning on July 21, 2015. The results of
these operations attributable to Rosetta will affect the
comparability of our financial results to prior periods. |
|
|
[1] |
See Schedule 5:
Reconciliation of Net Loss (GAAP) to Adjusted (Loss) Income
(Non-GAAP) for calculation. Adjustment herein excludes the impact
related to the license from our 2011 Dolphin discovery in Eastern
Mediterranean as the impact is reflected in Exploration
Expense above. |
Capital
Expenditures |
(in
millions, unaudited) |
|
|
|
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Capital Expenditures (Accrual Based) |
$ |
262 |
|
|
|
$ |
799 |
|
|
|
$ |
638 |
|
|
|
$ |
1,663 |
|
Increase in Capital Lease Obligations
[2] |
— |
|
|
8 |
|
|
— |
|
|
31 |
|
Total Capital Expenditures (Accrual
Based) |
$ |
262 |
|
|
$ |
807 |
|
|
$ |
638 |
|
|
$ |
1,694 |
|
[2] |
Represents estimated construction in progress to
date on US operating assets and corporate buildings |
|
|
Investor Contacts
Brad Whitmarsh
(281) 943-1670
Brad.Whitmarsh@nblenergy.com
Megan Repine
(832) 639-7380
Megan.Repine@nblenergy.com
Media Contacts:
Reba Reid
(713) 412-8441
media@nblenergy.com
Paula Beasley
(281) 876-6133
media@nblenergy.com
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