Expect Less Industry Spending In 2020
Producers will continue to focus in 2020 on generating free cash flow, say several analysts, resulting in forecasts for lower capital spending next year compared to 2019.
Ian Gillies, managing director, institutional research for GMP FirstEnergy, noted at the Petroleum Services Association of Canada’s recent 2020 outlook event that western Canadian energy services companies currently must contend with lower capital expenditures and cash flow profiles on the part of exploration and production firms.
Currently, GMP forecasts conventional spending to be down about six per cent in 2020 and flat in 2021 as producers simply are not incentivized to increase spending in the current industry environment.
During the upcoming 2020 guidance season, the Daily Oil Bulletin will again publish weekly updates to producers’ capital spending, drilling and production forecasts. The DOB provides coverage of both Canadian and U.S. operators.
The weekly report, for companies announcing 2020 guidance during the period Nov. 11-15, has updates for Birchcliff Energy Ltd., NuVista Energy Ltd. and Parex Resources Inc., among others.
To read more, click here.
- Capital Spending