Civitas still ‘laser-focused’ on cutting costs

Civitas still ‘laser-focused’ on cutting costs

**Civitas Continues to Drive Down Operational Costs in Oil and Gas Sector**

Civitas Resources Inc., based in Denver, has reaffirmed its commitment to cost-cutting measures, driven by a relentless focus on efficiency. As reported in the latest financial disclosures, the company has scaled back its capital expenditure (capex) forecast for the year while simultaneously increasing its production targets. This strategic approach underscores the organization’s dedication to achieving optimal resource utilization and enhanced profitability in an increasingly competitive industry.

In the second quarter of 2024, Civitas witnessed a significant rise in total production, reaching approximately 343,000 barrels of oil equivalent (BOE) per day. This increase was particularly pronounced in the Permian basin, where operations produced nearly 186,000 BOE/d. Concurrently, the Denver-Julesburg (DJ) basin operations contributed 157,000 BOE/d, though this figure declined slightly from the first quarter of 2024.

The company’s expansion into the Permian basin via three strategic acquisitions valued at approximately $6.7 billion has been a pivotal factor in its upward trajectory. Management’s decision to lift full-year production guidance by 1.5% reflects the positive impact of these investments. Additionally, Civitas has demonstrated substantial efficiency gains, which have led to a 2.5% reduction in cash operating expenses since the first quarter.

During an Aug. 2 conference call with analysts, President and Chief Executive Officer Chris Doyle emphasized the importance of continued cost reduction. Doyle revealed that well performance and trimming cash operating expenses have been key area of focus for the company. By the end of the second quarter, Civitas had managed to lower its costs to below $9/boe, representing a notable achievement in operational optimization.

Doyle highlighted several strategies that have contributed to these savings, including optimizing drilling and completion designs, high-grading service providers, utilizing more efficient equipment, standardizing facilities, and leveraging scale positions across multiple basins

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