Canadian oil and natural gas producer Encana Corp reported a quarterly operating profit that topped analysts’ estimates and boosted its 2017 capital expenditure target by 50 percent from a year earlier.
Crude prices are recovering from a two-year slump, prompting oil producers to raise their capital expenditure targets for the year and ramp up drilling and well completions.
The company said its capital expenditure for the year would range between $1.6 billion and $1.8 billion.
The Calgary-based company has also narrowed operations to focus on four core North American plays: the Montney and Duvernay in Western Canada, and the Eagle Ford and Permian in the United States.
Encana’s oil and natural gas liquids production fell nearly 25 percent to average 108,900 barrels per day in the fourth quarter, while natural gas output fell 19 percent to 1.28 billion cubic feet per day.
However, the company’s operating expenses nearly halved to $876 million in the quarter, helping it beat analysts’ profit estimates for the third straight quarter.
Encana’s operating profit, which excludes one-time items, was 9 cents per share, well above 3 cents per share estimated by analysts, according to Thomson Reuters I/B/E/S.
The company’s net loss narrowed to $281 million for the three months ended Dec. 31 from $612 million a year earlier, when it took an impairment charge of $805 million.