Noble to focus 2020 investment in DJ and Delaware basins

Noble Energy Inc. will focus 2020 investment in its contiguous acreage positions in the DJ and Delaware Basins, where it plans to spend $1.3 billion of its $1.6-1.8 billion planned capital budget. The total budget, a reduction of $560 million from 2019, does not include any midstream capital investments funded by Noble Midstream Partners LP.

A respective 60-40 split between the DJ basin and Delaware basin is expected, with plans to drill and complete 110-120 wells in the DJ basin and 50-60 wells in the Delaware basin this year, the company said. No new drilling or completion activity is planned for the Eagle Ford.

More than 75% of DJ basin wells online will come from the Mustang IDP with the remainder primarily in Wells Ranch. The Delaware basin program will focus on Wolfcamp A development in the northern and central parts of the company’s acreage position. Average well costs in DJ and Delaware basins are expected to be down 10% from 2019. Included in Delaware basin capital for this year is an estimated $35 million for linefill associated with the EPIC Crude Pipeline startup expected in this year's first quarter. Some 60% of the company’s US onshore capital program is targeted for the first half of the year.

Offshore development capital expenditures expected to be $275 million, significantly lower than 2019 as the Leviathan project concludes. Two-thirds of this amount is planned to be deployed in West Africa to progress the natural gas monetization project at Alen in Equatorial Guinea. The remaining one third is in Israel primarily for pipeline expansion work related to meeting contracted regional demand growth as well as finalization of Leviathan phase one development.

The company anticipates $75 million in exploration capital, the majority of which will go to costs associated with an offshore Colombia well planned for this year's second half.

Sales volumes for the year are estimated to be 10% higher than 2019 at the midpoint of the company’s 385,000-405,000 boe/d range. Growth is expected to be primarily a result of the impact of the company’s Leviathan project offshore Israel which commenced production at the end of 2019. Noble Energy’s natural gas sales volumes from Israel are estimated to average 445-485 MMcfd equivalent in 2020, an anticipated increase of over 100% from 2019.