Newfield sees slower Woodford growth in 2009

By OGJ editors
HOUSTON, Jan. 30 -- Newfield Exploration Co., Houston, expects to hike its Oklahoma Arkoma basin Woodford shale gas production 30% in 2009 even though it will run fewer rigs than in 2008.

The gains are expected to result from longer laterals and efficiency gains. Laterals are expected to average 5,000 ft compared with 4,436 ft in 2008 and 2,428 ft in 2007. Newfield has drilled 250 horizontal wells in the play to date.

The longer laterals are expected to yield higher initial production rates, greater recovery per well, and improved finding costs, Newfield said.

Gross operated Woodford production in early December exceeded the company's 2008 yearend goal of 250 MMcfed, and 2008 output was 65% higher than it was in 2007, Newfield said. Woodford will remain the company's largest investment region in 2009.

Companywide proved reserves were 2.95 tcfe at Dec. 31, 2008, up 18% on the year and all from organic drilling programs. That included 1.4 tcfe added in the Midcontinent division, including 419 bcfe in 2008.

Lee K. Boothby, senior vice-president, said, "Our drilling and completion costs in 2008, stated on a lateral foot basis, were 38% lower than in 2007."

Newfield cut its 2009 Gulf Coast budget 70% from 2008 after a higher-risk exploration strategy returned results well below expectations last year.

The company expects to record a $1.8 billion ceiling test writedown due to low commodity prices at the end of 2008.

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