Tom Brown sets capital budget, production targets for new year

Petroleum News

Exploration and production independent Tom Brown said it plans to spend $250 million to $300 million on exploration and development in 2004 compared to $245 million to $255 million in 2003.

Seventy to 80 percent of the budget this year is earmarked for development activities and the remainder for leasing and exploration, the company said, adding that it expects cash flow to “significantly exceed” its capital spending and that it intends to use the extra cash to reduce debt, acquire properties or possibly finance additional drilling.

“Our capital spending program is designed to achieve strong reserve and production growth and return on capital,” Jim Lightner, Tom Brown’s chief executive officer, said Dec. 18.

The Denver-based company projected that 2004 production would range between 114 billion cubic feet and 117 bcf of natural gas equivalent, or about 20 percent higher than 2003 output. Production is 85 percent natural gas.

Tom Brown said its 2004 capital budget excludes any property acquisitions or divestitures the company might do during the year, as well as production gains from any drilling successes.