Newfield Exploration Reports First Quarter 2017 Results

THE WOODLANDS, Texas, May 2, 2017

Newfield plans to host a conference call at 10 a.m. CDT on May 3, 2017. To listen to the call, please visit Newfield's website at http://www.newfield.com. To participate in the call, dial 719-325-2142 and provide conference code 9380687 at least 10 minutes prior to the scheduled start time. 

Year-to-date 2017 Highlights

• First quarter 2017 net production exceeded the mid-point of domestic and international guidance ranges.
• Domestic net production was nearly 139,000 BOEPD (40% oil and 60% liquids), exceeding the mid-point of original guidance by approximately 6,000 BOEPD.
• Consolidated net production was approximately 146,000 BOEPD (43% oil and 62% liquids), compared to the mid-point of original quarterly guidance of approximately 140,000 BOEPD. 
• The Company today increased its full-year 2017 production and capital investment outlooks.
• The mid-point for 2017 domestic guidance was raised more than 4,500 BOEPD to 148,600 BOEPD (original guidance: 144,000 BOEPD). The Company now estimates that its year-over-year domestic production growth, adjusted for prior-year asset sales, will be approximately 7%.
• The mid-point estimate for 2017 total company production was raised more than 5,000 BOEPD and is now approximately 155,100 BOEPD (original guidance: 149,850 BOEPD).
• The Company raised its mid-point estimate for fourth quarter average domestic production by approximately 5,000 BOEPD to 160,000 BOEPD (original guidance: 155,000 BOEPD).
• The Company's 2017 capital budget was increased to approximately $1.1 billion (original guidance: $1 billion), excluding capitalized interest and direct internal costs of approximately $125 million. The increase primarily relates to greater operated activity levels to build on recent successes through drilling and enhanced completions, optimization of plans related to full-field development and incremental industry activity in areas around Newfield's drilling programs.
• In 2017, Newfield has allocated about $100 million to test prospective horizons on its existing acreage. In the Anadarko Basin, this program has been named "SCORE" (Sycamore, Caney, Osage, Resource Expansion). Newfield is encouraged by initial early SCORE results and plans to share more information later this year as drilling results from a larger number of wells are known.
• Newfield had no incremental borrowings during the first quarter of 2017. The Company currently has approximately $500 million of cash on hand.
• Enhanced completions are today yielding superlative well results in all areas of operation. Recent highlights include:
• In STACK, Newfield has now completed 15 wells with new upsized completions of 2,100 pounds per foot of proppant and 2,100 gallons per foot of liquids. Utilizing early data from 13 wells with 60 days of production history, the wells are outperforming the Company's 1.1 MMBOE estimated average type curve by approximately 45%. The Burgess was a record STACK well announced during the quarter. After 60 days, cumulative production from the Burgess well is significantly exceeding the estimated STACK type curve, adjusted for lateral length.
• In the Williston Basin, Newfield's enhanced completions are yielding well performance significantly above historic type curves. The Company recently completed three wells (two Middle Bakken and one Three Forks), in our Lost Bridge Federal area located in Dunn County, North Dakota. The wells achieved an average 30-day production rate of 2,445 BOEPD (75% oil). These SXL wells were completed with an average of 10 million pounds of sand per well for an average completed well cost of about $6.1 million, including facilities. The Lost Bridge Federal and other recent completions, helped to increase first quarter 2017 average Williston Basin production 12% over the fourth quarter of 2016.
• Signed agreement with Enable Midstream Partners for 205,000 dekatherms per day of natural gas transport capacity in the Anadarko Basin by late 2018. Agreement expands on our existing agreements in the basin for gathering, processing and takeaway capacity to help ensure Newfield's future growth outlook.

"As you can see from our first quarter results, we are off to a great start in 2017 and building momentum that should carry into 2018 and beyond," said Lee K. Boothby, Newfield Chairman, President and CEO. "We remain confident that our near-term business plan is aligned with today's market realities. Our plan was carefully constructed to achieve several important objectives... to set the organization on a course to balance investments with cash flow while sustainably delivering double-digit production growth in the future, advance our learning curve in STACK through enhanced completions and initial infill drilling on multi-well pads, assess our SCORE program which includes several liquids-rich targets on our acreage and timely identify and mitigate potential bottlenecks to future development plans."

First Quarter 2017 Financial and Production Summary

For the first quarter, the Company recorded net income of $147 million, or $0.73 per diluted share (all per share amounts are on a diluted basis). After adjusting for the effect of unrealized derivative gains during the period, net income would have been $114 million, or $0.57 per share.

Revenues for the first quarter were $417 million. Net cash provided by operating activities was $167 million. Discretionary cash flow from operations was $243 million.