CALGARY – Addax Petroleum has budgeted capital expenditures for its Nigeria and Gabon operations with a 2009 full year Brent Crude average price of $60/bbl in mind, but could reduce capex if prices are lower, the company says.
Addax Petroleum has budgeted total capital expenditures of approximately $1.6 billion (excluding acquisitions), which are expected to result in total production averaging between 140 Mb/d to 145 Mb/d from these offshore and onshore operations. The company did not provide numbers for offshore operations only.
"Should the prevailing Brent Crude price continue to be below $60/bbl for the balance of 2009, Addax Petroleum intends, and has the flexibility, to reduce its capital expenditures such that total capital expenditures continue to be funded by internally generated cash flow," the company says in a statement.
An average Brent Crude price of $40/bbl would result in a reduction of capital expenditures to approximately $1 billion and the associated reduced drilling and facilities expenditures would result in Addax Petroleum's total production for 2009 averaging between 132 Mb/d and 137 Mb/d, the company says.