California Resources Corp. (CRC) is currently planning a 2024 capital program of $300-340 million but said actual spending related to oil and gas development will depend on various factors, particularly on its ability to obtain new well permits in the second half of the year.
Also of note, CRC’s 2024 guidance estimates exclude the pending all-stock merger with Aera Energy LLC (OGJ Online, Feb. 7, 2024). Aera is an operator of mature fields in California, primarily in the San Joaquin and Ventura basins, with high oil-weighted production. CRC plans to update guidance after the transaction closes, which is expected in this year’s second half.
Of the expected total, $250-260 million is related to oil and natural gas development, $30-40 million is related to maintenance of one of its gas processing plants and a power plant (both in CRC's Elk Hills field), $15-25 million on carbon management projects, and $5-15 million for corporate and other activities.
Through 2024, CRC expects to run a one rig program executing projects using existing permits. Subject to the availability of well permits, CRC expects to increase to a four-rig program in second-half 2024. If CRC is not able to obtain these permits, CRC could reduce its capital program by up to $100 million.
For this year’s first quarter, CRC expects to run a capital program of $65-75 million. The program includes $36-42 million for oil and natural gas and facilities development, $4-6 million for carbon management projects, and $25-27 million for corporate and other activities, including maintenance at CRC's Elk Hills power plant.
In the year’s first quarter, CRC expects to produce 76,000-80,000 boe/d (60% oil).
2023
For fourth-quarter 2023, CRC had net cash from operating activities of $131 million. Net income for the quarter was $188 million and adjusted net income was $67 million. CRC’s daily gross production in the quarter averaged 98,000 boe/d. Net production averaged 83,000 boe/d, including 50,000 b/d of oil.
Capital investments in the fourth quarter were in line with expectations and totaled $66 million. Capital allocation during the period was focused on a one-rig program in the Los Angeles basin.
For full-year 2023, the company generated $653 million of net cash from operating activities. The company had net income of $564 million and adjusted net income of $372 million. Average annual net production was 86,000 boe/d. Oil production averaged 52,000 b/d.
During the year, the company received California’s first US Environmental Protection Agency (EPA) draft Class VI well permits for underground carbon dioxide (CO2) injection and storage at Elk Hills.