W&T Offshore Inc. reduced its fourth-quarter 2022 production guidance by 1,500 boe/d at the midpoint to 38,00-42,000 boe/d, primarily due to unplanned downtime at the EnVen Energy-operated Neptune field and temporary maintenance downtime at Mobile Bay field.
Front-end engineering and design (FEED) and permitting processes are under way on the Holy Grail well at Garden Banks 783 in Magnolia field. The company expects to activate and mobilize the drilling rig in first-half 2023 for drilling in the year’s second quarter.
The update comes as part of the company’s third quarter report released Nov. 8.
Production for the Gulf of Mexico operator in third-quarter 2022 was 41,500 boe/d, at the midpoint of guidance, comprised of 15,700 b/d of oil (38%), 4,900 b/d of NGLs (12%), and 125 MMcfd of natural gas (50%). Production was down 2% from second-quarter 2022, but an increase of 19% from 34,800 boe/d in third-quarter 2021. During the quarter, the company performed two recompletions and five workovers that positively impacted production.
Revenues for the third quarter were $266.5 million, slightly lower than this year’s second quarter revenue of $273.8 million, and 99% higher than $133.9 million in third-quarter 2021.
The company generated net income of $66.7 million in the quarter with adjusted net income of $48.7 million, mainly reflecting the adjustment for unrealized derivative gain and derivative premiums.
Capital expenditures (excluding changes in working capital associated with investing activities) in third-quarter 2022 were $4.5 million.
W&T's guidance range for capital expenditures in 2022 has been reduced to $65-75 million for the full year, which excludes acquisition opportunities. The reduction from the previously guided $70-90 million reflects timing deferrals related to capital expected to now be deployed early-2023 rather than late-2022. Included in this range are planned expenditures related to one deep water well and three shelf wells, as well as capital costs for facilities, leasehold, seismic, and recompletions.
Guidance for plugging and abandonment expenditures in 2022 is revised to $65-75 million.
