E&Y: US O&G firms reported increases across the board

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The Houston branch of the London-based accounting firm, Ernst & Young released its 2015 US oil and gas reserves study Wednesday.

The study analyzed oil and gas reserves reported by publicly traded companies in their annual reports filed with the United States Securities and Exchange Commission (SEC).

The report shows a significant increase in total capital expenditures rising 16 percent to $200.2 billion from the top fifty US oil and gas firms in 2014. The results are for the five-year period from 2010 through 2014, and most of the companies listed are based in Houston, Texas.


EYReservesProd


Here are some highlights from the report:

  • A 10% increase in revenues in 2014 was outweighed by increases in costs and the recording of significant impairments, resulting in a 13% decline in after-tax profits.
  • End-of-year oil reserves were 27.2 billion barrels in 2014, representing 8% growth from 2013 and over 50% growth from 2010. Oil production rose 18% in 2014 and the oil production replacement rate was 201%, excluding purchases and sales.
  • End-of-year gas reserves grew 7% to 190.8 Tcf in 2014 and the gas production replacement rate was 218%, excluding purchases and sales.
  • Proved reserve acquisition costs declined sharply from $16.79 per boe in 2013 to $10.63 per boe in 2014. Finding and development costs moved the other direction increasing 13% in 2014.

Herb Listen, E&Y assurance oil and gas co-leader states, “There are numerous variables that impact reserve estimates, including commodity prices and the related cost of producing as well as multiple geological and geophysical considerations.” Listen goes on to add, “However, we will not be surprised to see some downward reserve revisions at the end of 2015 if oil and gas prices continue at current levels [of around $60/bbl] for the remainder of the year.”


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