INDUSTRY SCHEDULES 6% BOOST IN U.S. EXPENDITURES FOR 1993

Robert J. Beck

Economics Editor

The petroleum industry plans to boost U.S. capital and exploration spending in 1993 after outlays slipped in 1992.

Oil & Gas Journal's annual survey shows U.S. companies plan to spend $36.3 billion on domestic projects this year, up 6% from the $34.2 billion spent in 1992. Capital spending last year was down 6.8% from the $36.7 billion spent in 1991.

Earlier, capital outlays advanced 15.7% in 1989 and 8% in 1990. The recent low for spending was $25.2 billion in 1987 in the wake of the disastrous 1986 plunge in oil prices. Outlays planned for 1993 will be up a resounding 44.1% from 1987.

Adjusted for inflation, 1993 spending will be the second highest since 1986, exceeded only by 1991. But inflation adjusted outlays during 1986-93 have been at the lowest levels since 1973. This is reflected most vividly in the depressed level of upstream activity.

DOWNSTREAM, UPSTREAM

Downstream spending in 1993 will exceed upstream spending for the fourth straight year.

Downstream spending exceeded upstream outlays in 1990 for the first time since 1971. During the last several years a sharp drop in drilling has cut upstream outlays. At the same time, investments in upgrading, renovation, environmental compliance, marketing, and transportation has boosted downstream outlays.

Exploration and production spending in 1993 will rise 5.8% from the 1992 level to $15.5 billion. For the past 8 years spending on exploration and production has been varied with no pronounced upward or downward trend. During 1987-93 annual exploration and production outlays have fluctuated between a low of $14.2 billion posted in 1987 and a high of $17.5 billion in 1988.

Downstream spending will advance 6.1% this year to $20.8 billion.

Refining outlays will increase 7.1% to a record yearly high of $7.3 billion.

Spending on petrochemicals will fall for the third year. That industry is still adjusting to surplus capacity that developed a few years ago and waiting for a surge in U.S. economic growth. Plans this year call for outlays of $2.3 billion, down 6.5% from 1992.

U.S. companies continue to shift some of their outlays to operations outside the U.S. and Canada. Plans call for an increase again this year, particularly upstream. However, the rate of increase has slipped because of the industry's uncertain economic outlook.

Spending outside of North America rose sharply in 1991, but the rate of increase slowed last year. For the first time in several years the rate of increase in spending in the U.S. is expected to outpace the increase in non-U.S. outlays.

A survey by Salomon Bros. Inc., New York, showed somewhat similar results (OGJ, Feb. 8, p. 79).

AN EYE ON PRICES

Since the mid-1980s oil and gas price volatility has caused many companies to closely monitor prices throughout the year and release funds only if current price expectations meet or exceed budget assumptions.

There is growing concern about crude oil and product prices in 1993. That's because a return to a substantial surplus in world oil supply is possible.

The U.S. price for crude oil averaged an estimated $16.06/bbl for 1992, down 3% from 1991. But prices were stronger during the second half of the year when 1993 budgets were taking shape. The price averaged $15.30/bbl in first half 1992, then rose to $16.82 in the second half.

Of even greater significance for 1993 U.S. spending is the level of natural gas prices.

The average U.S. wellhead price is estimated at $1.78/Mcf for 1992, up 8.5% from a year earlier. Prices have been strong recently, reflecting increased demand and encouraging gas exploration and development.

OGJ expects natural gas prices to move up again in 1993, stimulated by increased demand. Partially offsetting that benefit to producers will be the possibility of weaker oil prices as the Organization of Petroleum Exporting Countries struggles with the problem of surplus productive capacity (see story, p. 34).

OUTSIDE NORTH AMERICA

The OGJ survey shows that 1993 budgets will reverse the trend of the last few years when U.S. companies committed a growing share of their dollars to projects outside North America.

This year the rate of growth in spending on non-North American projects will lag growth in the U.S. but remain ahead of Canada, where outlays will fall again.

In 1991 non-North American spending by a group of U.S. companies jumped 16.7%. This was in contrast to an 8% increase in U.S. spending and a 1% increase in Canadian spending.

In 1992 a group of 38 U.S. companies posted a 4.2% increase in non-North American outlays. This was in contrast to a decline of 6.8% in U.S. spending and a drop of 8.9% in Canadian outlays.

In 1992 this group of companies spent $18.5 billion outside North America, compared with $17.8 billion in 1991.

This year those 38 companies plan to increase non-North American spending a modest 2.3% to $19 billion. This compares with a 6% increase planned for U.S. outlays and a decline of 4.7% in Canadian spending. Spending plans in 1993 represent an increase of 6.7% from 1991.

Most of the increase in 1993 spending by this group will be in upstream sectors, which will move up 4.8% to $13.3 billion. Total upstream spending plans show increases of 5.8% in the U.S. 1.1% in Canada.

Upstream spending outside North America by this group was $12.7 billion in 1992 and $12.4 billion in 1991. Upstream spending outside North America will be up 6.9% from 2 years ago. During the same period E&P spending will be down 10% in the U.S. and 18% in Canada.

Non-North American downstream spending by this group will be down 2.9% in 1993 at $5.7 billion. It was $5.8 billion last year and $5.3 billion in 1991.

Downstream spending in 1993 outside the U.S. and Canada will be up 6.2% from 1991. Total downstream spending in the U.S. will be up 7.8% over the same 2 years. In Canada it will be down 5% over the 2 years.

EXPLORATION, PRODUCTION

U.S. exploration and production budgets call for an increase of 5.8% in 1993, moving up to $15.5 billion from $14.7 billion last year. E&P spending in 1992 dropped 15.9% from the $17.5 billion in 1991.

This was consistent with the plans for 1992 reported in last year's survey (OGJ, Feb. 24, 1992, p. 25). A year ago the OGJ survey showed the industry planned to cut E&P spending by 12.4% to $14.3 billion.

As the year progressed, weak earnings contributed to a curtailment of projects and reduced spending.

Upstream spending peaked in 1981 at $57.8 billion. A sharp drop in crude oil and natural gas prices led to a steep steady decline in E&P investment from 1982 through 1987. It dipped to a recent low of $14.2 billion in 1987, a decline in annual outlays of $43.7 billion. This accounted for 75.6% of the decline in industry spending between 1981 and 1987.

E&P spending rebounded to $17.5 billion in 1988, then slipped to $15.5 billion in 1989. Outlays moved up to $16.6 billion in 1990 and to $17.4 billion in 1991.

Drilling activity reflects the decline in upstream investment. The number of active rigs hit a record in 1981, averaging 3,970 for the year. With declining prices the number of active rigs slipped steadily to average 1,980 in 1985.

Weak crude oil prices, along with increased taxes and operating costs, have eroded the economics of drilling, and the rig count has continued to fall. The count posted consecutive record annual average lows of 860 in 1991 and 717 in 1992. The record weekly low was also posted in 1992 at 596 the week of June 12.

Drilling is expected to remain at this depressed level in 1993.

Well completions are expected to be at the same level as in 1992. OGJ has projected total well completions at 25,600 wells in 1993, compared with 25,620 in 1992. Well completions peaked at 89,234 in 1981.

Outlays for Outer Continental Shelf lease bonuses have almost disappeared. Bonuses fell to only $96 million in 1992 from $339 million in 1991, and are estimated at only $100 million for 1993.

NON-E&P SPENDING

Planned non-E&P spending in 1993 will be up 6.1% at $20.8 billion in the U.S. This follows a modest increase of 1.6% in 1992 to $19.6 billion. This will be the seventh consecutive year with increased non-E&P spending.

Such spending peaked in 1981 at $25.2 billion. With falling crude oil and product prices and diminishing cash flow, spending fell to $10.4 billion in 1986. In the following years improved market conditions, along with restructuring to cut operating costs, enabled companies to boost outlays. In addition, there was some mandatory spending required to meet new environmental regulations.

Capital spending in 1993 for U.S. non-E&P projects will be up 98.8% from the depressed level of 1986.

The gain has been led by substantial increases in outlays for refining, marketing, and petrochemicals. Increases in those sectors accounted for 74.1% of the increased non-E&P spending between 1986 and 1992.

Refining capital spending is planned at $7.3 billion in 1993, up 7.1% from $6.8 billion last year. Much of the recent spending and outlays planned for 1993 is for upgrading plants to meet changing product demand and for equipment to meet new environmental requirements.

There may be some capacity added in certain locations, but it appears total U.S. refining capacity will decline. Some refiners are shutting in capacity because of rising costs of environmental compliance. Any capacity additions probably will include restarting shut-in capacity and adding units to plants.

Capital spending for marketing is planned to be down this year, falling 0.6% to $2.5 billion. Last year, marketing spending dropped 8.1% from the record high of $2.8 billion in 1991. Restructuring, intense competition, and a shifting consumer preference toward convenience stores has pushed up marketing outlays in recent years.

PETROCHEMICALS

Capital spending by U.S. oil and gas companies on petrochemical plants will slip again this year, falling 6.5% to $2.3 billion. This follows a decline of 1.7% in 1992 and 19% in 1991.

Petrochemical spending moved up sharply during 1987-90. Outlays in 1987 were only $1.3 billion. Spending jumped 57.2% in 1988, 38.4% in 1989 and 15.1% in 1990, reaching a record $3.1 billion in 1990.

During this period the petrochemical sector was posting record profits.

In recent years the petrochemical industry has booked lower profits due to reduced demand linked to the slowdown in economic activity. The industry also experienced some problems due to excess capacity which increased competitive pressures and reduced profits.

These factors led to a reduction in capital outlays. Much of the spending in this sector is for environmental projects related to the Clean Air Act.

TRANSPORTATION

Spending on U.S. oil and gas transportation will advance sharply again in 1993, increasing 19.3% to $5.6 billion. Transportation spending jumped 23.1% last year to $4.7 billion.

A large part of the spending is for natural gas pipelines. In 1993 outlays for gas pipelines will represent 56% of the total even though gas pipeline spending will be down 7.6% from last year. Gas pipeline spending plans call for outlays of $3 billion in 1993, compared with $3.3 billion in 1992. Outlays last year were up 18.8% from 1991.

Spending on crude oil and petroleum product pipelines will rocket in 1993, increasing 139.5% to $1.9 billion. Last year's outlays were $779 million, up from $381 million in 1991.

Plans call for 3,751 miles of natural gas pipeline and 3,004 miles of crude oil and product pipelines to be laid in the U.S. in 1993 (OGJ, Feb. 8, p. 25). This is up from the plans a year ago, which called for 3,757 miles of natural gas pipeline and 1,336 miles of crude and product pipeline to be laid in 1992 (OGJ, Feb. 10, 1992, p. 19).

Capital spending for other forms of transportation are expected to increase 11.7% in 1993 to $728 million. This compares with a decrease of 4.8% in 1992 at $652 million. Increased imports are a major factor boosting other transport outlays.

COMPANY PLANS

A number of U.S. companies disclosed their spending plans for 1993 in news releases.

Mobil Corp. announced 1993 capital and exploration spending about the same as the 1992 level of $4.4 billion.

Chairman Allen E. Murray said, "Spending this year will continue to reflect a shift toward the international area, where opportunities to find and develop resources are the greatest and product demand growth is the highest. For example, foreign expenditures increased from about 40% of the total expenditures in 1986-90 to nearly 60% the last 2 years and will increase to 65% in 1993."

Mobil spending for exploration and production is estimated to be about $2.4 billion for the year, up $400 million from 1992. U.S. spending of $500 million will be about flat with 1992. This is down considerably from prior years because most prospective acreage remains off limits due to government moratoriums.

However, international spending is expected to increase to about $1.9 billion, reflecting outlays to step up production in Nigeria, the North Sea, Indonesia, and Australia and develop Hibernia oil field off eastern Canada.

Murray said, "Mobil remains flexible. The budget can be revised if the business environment, and particularly economic conditions, warrant changes later in the year."

Amoco Corp.'s budget of $3.2 billion for 1993 is also about the same as 1992. The largest portion will go for oil and gas exploration and production, about 70% of that earmarked for non-U.S. projects.

Chairman H. Laurence Fuller said, "This budget reflects our continuing shift to overseas exploration and production. Although we anticipate flat prices for crude oil and only somewhat higher prices for natural gas, we are confident we can maintain our current level of capital spending. This is largely true because the cost cutting program we started earlier is yielding significant results.

"Spending levels will remain flexible and ultimately depend on oil and gas prices, as well as the company's cost reduction efforts."

Amoco expects to drill about 50 exploration wells in 1993, with about 90% of them outside the U.S.

Chevron Corp. unveiled a $4.9 billion capital and exploration budget for 1993. This is up about 5% from estimated 1992 spending of $4.6 billion. The new program includes the expected Apr. 1 start-up of the Tengiz joint venture field development campaign in Kazakhstan.

Chairman Ken Derr said, "This program reflects our long term strategy of strengthening the company in our most promising core oil and gas areas. The significant restructuring undertaken last year by our U.S. and Canadian exploration/production business and our corporate staffs, along with our focus on managing costs in all operations, has allowed us to improve cash generation. We expect to fund our 1993 investments through cash generated by operations and from our continuing program to divest nonstrategic or poorly performing operations."

Chevron plans to spend about $2.6 billion in worldwide exploration and production, up almost 10% from estimated 1992 spending. About 75% of the outlays are to be outside the U.S., which continues the shift of the company's exploration/production focus.

U.S. exploration and production spending of about $700 million will be 20% below the estimated 1992 level and about half the sum spent in 1991. Chevron said in addition to shrinking opportunities in U.S. exploration, the decrease reflects efforts to make operations more efficient. These include divesting nonstrategic fields and boosting production from core operations.

Besides Tengiz and a share in Hibernia field, Chevron's E&P program includes development of Alba field in the North sea, enhanced recovery projects in Indonesia, new oil and gas developments in Australia and West Africa, and initial development of a major Norphlet gas discovery in the Gulf of Mexico.

Worldwide refining, marketing and transportation spending is projected at about $1.7 billion, a little less than estimated 1992 spending of $1.8 billion. U.S. spending will be about 10% below 1992. A significant portion is earmarked for projects to produce clean fuels as required by the Clean Air Act and the California Air Resources Board.

Non-U.S. refining, marketing, and transportation outlays are forecast at more than $800 million, with about 70% focused on Caltex, Chevron's 50% owned affiliate in the Eastern Hemisphere. Projected Caltex spending is up more than 25% from 1992 estimates, maintaining or expanding strong market positions where Caltex operates.

Chevron also plans to spend about $259 million in worldwide chemicals in 1993, about the same as estimated for 1992. The program includes a major benzene recovery unit under construction at Pascagoula, Miss.

ARCO announced a $2.5 billion budget for 1993, up from $2.3 billion spent in 1992.

Chairman Lodwrick M. Cook said, "The 1993 program maintains ARCO's emphasis on exploration and development programs internationally and in Alaska. We made substantial progress in bringing proposed international projects to reality in 1992, and we are backing those projects with major capital commitments in 1993."

About 60% of ARCO's 1993 budget will go into oil and gas exploration, development, and production. Upstream operations claimed 52%, or $1.2 billion in 1992.

For 1993, spending for international operations is estimated at $730 million. Projects in Alaska, including exploration, will total $490 million. Capital spending in the Lower 48 is budgeted at $330 million.

Spending in refining and marketing is to get $450 million. The company is starting projects to meet the 1995 requirements of the Clean Air Act.

Arco Chemical Co.'s 1993 capital program is set at $260 million. Coal operations will account for $120 million of spending and transportation operations $70 million.

USX approved a Marathon Group 1993 budget of $1.115 billion, down 12% from 1992 spending of $1.265 billion. The group's worldwide exploration budget for 1993 is $150 million, with $86 million dedicated to non-U.S. projects. The capital program of $965 million includes $607 million for production, $335 million for refining, marketing, and transportation, and $23 million for other categories.

Upstream capital spending plans include $342 million for international projects with $262 million related directly to development of East Brae field in the U.K. North Sea and its associated SAGE pipeline system.

In the U.S., field development in the Ewing Bank area of the Gulf of Mexico represents another major area of upstream capital spending at $57 million. Production is scheduled to begin in 1994.

Environment related outlays will amount to $141 million this year, down from prior years as Marathon completes its $300 million multiyear capital program for diesel desulfurization.

Construction of two liquefied natural gas tankers, scheduled for delivery this year, represent another major area of downstream capital spending totaling $57 million.

Unocal Corp. last week unveiled a $1.41 billion budget for 1993, focusing on oil and gas reserves development and refining improvements.

The investment plan compares with $959 million spent in 1992 and $1.47 billion in 1991. The company's spending program in 1992 was down because of the broad restructuring throughout the company and an emphasis on debt reduction.

Richard J. Stegemeier, Unocal chairman and chief executive officer, said the 1993 capital investment plan is to be funded with improved cash flow from operations and proceeds from major asset sales, including the sale of its Auto/TruckStop retail marketing system and geothermal assets in California's Imperial Valley. Both sales are expected to close in first quarter 1993.

"This year we will be focusing investment in development projects in North America and overseas that should provide a high return on investment," Stegemeier said.

He said Unocal's significant restructuring in 1992 and the continued focus on managing and controlling costs in all operations should enable the company to realize cash flow to support the planned capital spending level. Proceeds from the sale of a $513 million private placement preferred stock issue in 1992 were used to accelerate the debt reduction program. This makes cash flow from operations, which otherwise would have been used to reduce debt, available for investment in the company's core business.

In 1992, Unocal reduced debt by more than $1 billion to $3.7 billion. The company plans to reduce debt by another $500 million during the next 4 years. Unocal plans to spend $817 million on worldwide petroleum development, up about 49% from $549 million in 1992 and 27% above the $642 million spent in 1991. It plans to focus investment in high return development projects in North America and overseas.

Sixty-two percent of those outlays, or $506 million, are planned for the U.S., up substantially from $345 million in 1992 and $394 million in 1991. The major focus is on development of a reserve inventory in Louisiana and the Gulf of Mexico, Alaska's Cook Inlet, and other areas.

Capital spending for non-U.S. petroleum development is expected to total $311 million, up from $204 million in 1992 and $248 million in 1991. The 1993 budget calls for continued development of gas fields off Thailand, Serang field in Indonesia, and oil reserves off Netherlands.

Worldwide exploration spending is budgeted at $93 million, compared with $90 million in 1992 and $215 million in 1991. The spending plan includes $46 million in the U.S. and $47 million elsewhere. The exploration capital budget in 1993 reflects Unocal's shift to developing its reserve inventory, while focusing on fewer key exploration projects.

Planned capital spending for geothermal energy totals $85 million, up sharply from $37 million last year. The company plans to focus on development of geothermal reserves at Salak in Java.

Refining, marketing, and transportation spending is projected at about $343 million, compared with $201 million in 1992 and $479 million in 1991. This includes nearly $240 million for general refinery upgrades to meet environmental requirements and the addition of units to increase production of higher value products or assist in the manufacture of reformulated gasoline.

Capital spending for chemicals operations is budgeted at $23 million, down from $64 million last year and $86 million in 1991.

Other capital spending, which includes environmental cleanup of facilities slated for sale, is budgeted at $45 million.

Phillips Petroleum Co. approved $1.2 billion for capital projects in 1993. This is up 2% from estimated 1992 spending of $1.17 billion. The 1992 outlays included $153 million for the Houston Chemical Complex (HCC). By yearend 1992 the rebuild and expansion of HCC's polyethylene production unit will be near completion.

Chairman C.J. Silas said, "In 1993 the company's strategic focus will be on meeting the company's safety and environmental needs, profitably replacing oil and gas reserves, profitably repositioning the natural gas liquids business, and improving Phillips' overall financial flexibility."

Almost 75% of the 1993 budget will go upstream. Exploration and production spending will be $800 million, an increase of 37% from 1992's $583 million. Included in the 1993 E&P expenditures is $129 million to cover the final payment for LNG tankers in Alaska.

Of E&P's 1993 budget, $294 million will go for international production activities, compared with $255 million in 1992. Major projects are in the Embla field in Norway, the J-Block and Ann fields in the U.K., the Xijiang field in China, and the Ogbainbiri field in Nigeria.

The E&P budget includes $138 million for exploration. Most of this is to be spent on projects near existing operations that have potential for rapid development. About one third of the exploration money go for potential large reserve, high reward, frontier prospects. Funding of exploration projects is expected to be 44% U.S. and 56% non-U.S. Key wildcats are to be drilled in Alaska, Australia, Norway, U.K., Italy, and Egypt.

Downstream expenditures are budgeted at $302 million, a reduction of 37% from the 1992 level of $483 million. The reduction largely reflects completion of the HCC rebuild.

More than 60% of 1993 downstream expenditures will go for projects authorized during or before 1992.

Funding in 1993 will come from cash generated by continuing operations and sale of assets. About $150 million in asset sales were recorded in 1992.

Kerr-McGee Corp. budgeted $415 million for 1993, about the same as 1992.

About 65% of the 1993 budget, or $270 million, will be spent on exploration and production, compared with $264 million in 1992. Of the 1993 amount, 60% is allocated for oil and gas development projects in the North Sea. The rest will be spent in the Gulf of Mexico, onshore U.S., Canada, and other parts of the world.

About $45 billion will go for development of coal reserves in Wyoming and Illinois. That compares with $69 million spent on such projects in 1992.

The chemical sector's budget is $55 million, up 60% from 1992. The additional money will be used for capacity expansions.

Refining and marketing are budgeted at $40 million, about the same as 1992.

Sun Co. Inc. approved a 1993 capital program of $755 million, a 36% increase from projected 1992 spending of $555 million. However, the 1993 budget is 5% less than the $795 million originally budgeted for 1992.

Chief Executive Robert H. Campbell said, "The 1993 budget includes $160 million for the value added segments of Sun's core refining and marketing business-brand marketing, lubricants, chemicals, and logistics."

The 1993 budget includes refining and marketing projects that were deferred from 1992.

Capital for international oil and gas programs is targeted for development in line with the company's decision to withdraw from exploration outside of Canada.

Suncor, Sun's Canadian subsidiary, has a $245 million budget for 1993. It plans a major program to convert its oilsands mining operation from bucketwheels to trucks and shovels.

After a recent restructuring, Sun is focusing on U.S. refining and branded marketing, as well as on its chemicals, lubricants, and logistics businesses. The company's real estate holdings and coal assets are for sale.

Louisiana Land & Exploration Co. announced a 1993 budget of $170 million, 15% higher than estimated spending for 1992. Included in this year's budget is $64 million for exploration, $83 million for development, $9 million for refining, and $14 million for other activities. North American exploration and development expenditures are expected to total $99 million, while $48 million has been allocated for non-U.S. projects.

LL&E Pres. H. Leighton Steward said, "We intend to continue the strategy of buying high quality reserves in areas of strategic importance to the company. As in the past, our policy is to live with our cash flow for exploration and development while allowing our strong balance sheet to support acquisitions if necessary."

Union Texas Petroleum disclosed a budget of $253 million for 1993. It spent $308 million last year.

The company also set budgets for 1994 and 1995 at about $190 million and $180 million respectively, an increase from previous estimates. Union Texas expects to spend an average of 25% of total capital outlays on exploration during these years to pursue opportunities in areas where it company has interests and experience.

Union Texas plans to spend $66 million this year to complete redevelopment of Piper field and development of the nearby Saltire field, both in the U.K. North Sea. Completion of those projects will result in a sharp reduction in capital spending and the start of significantly more oil production and related cash flow. The company also has earmarked $64 million for other exploration and development programs in the North Sea.

About $74 million will go for exploration and development in the company's Indonesian joint venture to support LNG sales from the government owned Bontang Bay liquefaction plant.

Another $37 million is budgeted for exploration in Alaska, Pakistan, Argentina, Papua New Guinea, and other areas as well as coalbed methane projects in Europe. Total exploration spending amounts to about 26% of the 1993 budget.

The company also has designated $6 million for development projects in Pakistan and $6 million for its Petrochemical interests in the U.S.

Cabot Oil & Gas Corp. announced it will spend $50.6 million for drilling, acquisitions, and exploration in 1993. The company spent $43 million in 1992.

Cabot plans to drill 105 gross (95 net) wells in its major operating areas: 72 gross (69 net) in the Appalachian basin and 33 gross (26 net) in the Anadarko basin.

Cabot's Chairman John H. Lollar said, "If natural gas prices improve during the year and our cash flow increases, we can respond quickly with additional wells based on our large inventory of drilling locations."

The 1993 budget includes $9.6 million for acquisitions and $7.1 million for exploration. The company plans to drill seven wildcats, mainly in the Appalachian basin. Also in the 1993 budget is $7.1 million for expansion and maintenance of Cabot's 3,100 miles of gathering and transmission lines.

Enserch Corp. plans to step up 1993 spending to $180 million from an estimated $142 million in 1992.

E&P is budgeted at $92 million, an increase of 42% from 1992. In addition, this segment expects to add $76 million of equipment in 1993 under lease arrangements, up from $29 million in 1992, all for production facilities for offshore projects.

Columbia Gas Systems approved a $407 million capital spending program for 1993. Of the total, $69 million will go for exploration and development, $178 million for transmission operations, and $24 million for other energy projects, including cogeneration.

Consolidated Natural Gas announced a 1993 budget of $344 million, down from $426 million in 1992. The new budget includes $120 million for exploration and production, $112 million for gas transmission, and $111 million for gas distribution.

The lower level of spending planned in 1993 is due mainly to completion in 1992 of major interstate pipeline construction projects.

Burlington Resources set 1993 spending plans at $420 million, up from $315 million in 1992. Spending will go mainly for field development, reserve acquisitions, and processing plant and pipeline capacity expansions.

Seagull Energy Co. set its 1993 budget at $109 million, compared with $32.1 million in 1992. Of the 1993 spending, $20 million will be for exploration, $6 million for lease acquisitions and $83 million for development.

Copyright 1993 Oil & Gas Journal. All Rights Reserved.