U.S.-based oil and gas company Talos Energy bounced back to the black in the second quarter of 2019 on the back of higher revenues boosted by record production levels.
Talos on Wednesday posted a net income of $94.8 million for the second quarter of 2019 compared to a loss of $75 million in the same period last year.
The company recorded revenues of $286.8 million and average realized prices of $64.13/Bbl of oil and $2.45/Mcf of natural gas, net of deductions. 92% of operating revenues were derived from oil production and reflect a significant basis differential premium to the average WTI benchmark price of $59.81/Bbl during the same period. In 2Q 2018, Talos recorded revenues of $203.9 million.
The company’s production for 2Q 2019 was 59 thousand barrels of oil equivalent per day (MBoe/d), or 5.4 million barrels of oil equivalent (MMBoe) in total, of which 75% was oil and 81% was liquids.
Capital expenditures, inclusive of plugging and abandonment costs, were $187.4 million with approximately $156.2 million related to the U.S. Gulf of Mexico and $31.2 million related to offshore Mexico.
President and Chief Executive Officer, Timothy S. Duncan, commented: “This was the company’s best quarter on record in terms of production, Adjusted EBITDA, and Adjusted EBITDA Margin excluding hedges on a percentage basis, even with lower commodity prices and slightly higher service costs from a year ago.”
Duncan also said: “We executed numerous successful drilling projects in both deepwater and shallow water in the U.S. Gulf of Mexico and two drilling programs in offshore Mexico. Our annual capital program was significantly front-loaded in the first half of the year with five rigs working during the second quarter. Even with this high level of activity, our U.S. Gulf of Mexico business generated meaningful free cash flow in the second quarter.”
He added: “In the second half of the year, we expect to continue generating a significant amount of free cash flow from our U.S. Gulf of Mexico business that will be further enhanced by having concluded the Zama appraisal in the second quarter.”
Offshore Energy Today Staff
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