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News in brief Burlington takes charge against Canadian properties
Big exploration and production independent Burlington Resources says it will take a $90-million impairment charge for the 2004 fourth quarter related to the value of undeveloped properties in Canada.
The pre-tax charge will amount to 15 cents per share but will not affect the company’s reserves or drilling inventory, Burlington said Jan. 13.
Burlington also said it expects 2004 fourth-quarter production to achieve the midpoint of its previously announced guidance range, reflecting higher location price differentials for North American natural gas and worldwide crude oil compared to benchmark prices, and the timing of oil shipments. In 2005, the company said it expects to produce 2.8 billion to 3.1 billion cubic feet of natural gas equivalent per day. In addition, combined operating, administrative and transportation expenses on a unit basis are expected to be in line with 2004 full-year levels, the company added. Worldwide rig economics continued to improve Contract driller GlobalSantaFe said Jan. 17 that the company’s worldwide SCORE, or Summary of Current Offshore Rig Economics, for December was up 3.6 percent from the previous month.
The SCORE compares the profitability of current mobile offshore drilling rig day rates to the profitability of rates at the 1980-1981 peak of the offshore drilling cycle. During that period, when the SCORE averaged 100 points, new contract day rates equaled the sum of daily cash operating costs plus about $700 per day per million dollars invested. For December, the overall worldwide index averaged 54.8 points versus 52.9 points for November, an increase of 3.6 percent. On a regional basis, the Gulf of Mexico in December averaged 56.2 points, an increase of 4.7 percent from the previous month’s 53.6 points. West Africa averaged 57.1 points, an increase of 6.9 percent from the prior months 53.4 points. Southeast Asia averaged 56 points, an increase of 3.7 percent from the previous month’s 54 points. The North Sea was unchanged with 53 points.
Meanwhile, the worldwide SCORE for semi-submersible rigs or floaters rocketed to 52.1 points in December from 48.2 points in November. The SCORE for jack-up rigs was unchanged at 58.1 percent.
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