PetroChina has proven another 158 million metric tons, or about 1.15 billion barrels, of shale oil reserve in a pilot project in northeast China, Chinese state media reported on Friday. ...

By Georgina McCartney HOUSTON (Reuters) -Oil and gas activity in the key producing states of Texas, Louisiana and New Mexico declined slightly in the third quarter, as executives there expressed an increasingly negative outlook for the industry, according to a survey released by the Federal Reserve Bank of Dallas on Wednesday. The drop in activity and production comes amid growing uncertainty around oil prices and increased frustration with U.S. President Donald Trump's administration. Executives blamed ...

Financial Performance - Diamondback Energy reported quarterly earnings of $2.67 per share, missing the analyst consensus estimate of $2.92 [1] - Quarterly revenue was $3.67 billion, exceeding the Street estimate of $3.36 billion and up from $2.48 billion in the same period last year [1] Operational Insights - The company indicated that U.S. shale oil production has likely peaked at current oil prices, with activity levels in the Lower 48 expected to remain depressed [2] - The U.S. oil-directed rig count has decreased by approximately 60 rigs this year, with 59 rigs lost in the second quarter alone [2] - The active completion crew count in the Permian Basin has declined to around 70 active crews, down over 25% from 2024 [2] Cash Flow and Expenditures - Net cash provided by operating activities was $1.7 billion, with Operating Cash Flow Before Working Capital Changes at $2.1 billion [4] - Cash capital expenditures totaled $864 million, while Adjusted Free Cash Flow was reported at $1.3 billion [4]

Financial Data and Key Metrics Changes - The company reported an adjusted EBITDA of $1.24 billion for Q1 2025, reflecting a significant sequential growth of 48% [7][14] - Revenue for Q1 was $4.61 billion, showing a 3% sequential decline but a 7% year-over-year increase [13][14] - The net result was a loss of $10 million, an improvement from a loss of $284 million in Q4 2024 [16][17] - CapEx for Q1 was $1.21 billion, with 75% allocated to unconventional assets, aligning with the annual guidance of $5 billion to $5.2 billion [17][18] Business Line Data and Key Metrics Changes - Shale oil production increased by 31% year-over-year, now representing 55% of total oil production [9][19] - The downstream segment achieved a record refining utilization rate of 94%, processing 318,000 barrels per day [10][27] - The company signed an MOU with Globant to accelerate digital transformation, focusing on AI implementation [11] Market Data and Key Metrics Changes - Oil export to Chile grew by 34% year-over-year, reaching 36,000 barrels per day [20] - Natural gas production increased by 9% sequentially, delivering over 37 million cubic meters per day [20] - Local fuel prices increased by 2% sequentially and 1% year-over-year, while the market share remained at 56% [26][27] Company Strategy and Development Direction - The company is focusing on reducing exposure to mature fields and enhancing shale production as part of its four-pillar plan [7][19] - A new business structure was implemented in 2025, splitting the Gas and Power segment into LNG and Integrated Gas and New Energies [6] - The company aims to achieve an annual average Brent price of $72.5 per barrel for 2025 [16][34] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's resilience amid price volatility, indicating a breakeven level of $60 per barrel for EBITDA [39] - The company anticipates a reduction in leverage as it divests from mature fields, expecting to reach a net leverage ratio of 1.5 to 1.6 times by year-end [34][72] - Future CapEx adjustments will depend on market conditions, with management indicating flexibility in response to price changes [45][73] Other Important Information - The company reported a negative free cash flow of $957 million in Q1, primarily due to the performance of mature fields [18][31] - The company is actively refinancing its debt, with a focus on local market opportunities [92] - The LNG projects are progressing, with FID expected for the Southern Energy JV by July 2025 [51][82] Q&A Session Summary Question: Current Brent breakeven level in terms of EBITDA and cash flow - Management indicated that every $10 reduction in Brent results in a $900 million impact on EBITDA, with a breakeven level around $60 [39] Question: Required CapEx to maintain current production - The required CapEx to maintain production is estimated at $2 billion [40] Question: Flexibility on CapEx and activity levels amid current oil price scenario - Management stated they would adjust their plans if necessary but are currently not considering changes [44] Question: Impact of divestment of mature assets on cash flow - The impact was around $230 million, with expectations of minimal further impact as divestments progress [49][50] Question: Steps for final investment decision on LNG projects - FID for the Southern Energy JV is expected by July, with ongoing negotiations for other projects [51][52] Question: Fuel pricing strategy and market share expectations - The pricing strategy is aligned with international market conditions, and the company expects to maintain its market share [56] Question: Update on Vaca Muerta Sur and gas pipeline negotiations - The company is on track for initial production by the end of 2026, with ongoing discussions for pipeline investments [60][63] Question: Divestment of Nitro Fuels and production contribution - The production contribution from divested blocks is minimal, with a focus on improving production from Vaca Muerta [66][68] Question: CapEx guidance and affiliate contributions - The $5 billion CapEx guidance does not include contributions to affiliates, which are part of ongoing infrastructure projects [77][80]

Financial Data and Key Metrics Changes - The company reported an adjusted EBITDA of $1,240 million, reflecting a sequential growth of 48% due to divestment in mature fields and improved refining and marketing margins [7][13][14] - Revenue for Q1 was $4,610 million, showing a 3% sequential decline but a 7% year-over-year increase, primarily driven by shale activity and higher local fuel prices [12][13] - The net result was a loss of $10 million, significantly improved from a loss of $284 million in Q4 last year, attributed to higher adjusted EBITDA and lower one-off costs [14][15] Business Line Data and Key Metrics Changes - Shale oil production increased by 31% year-over-year, now representing 55% of total oil production, with total hydrocarbon production rising by approximately 5% [8][18] - The downstream segment achieved a record high refining utilization of 94%, processing 318,000 barrels per day, and refining margins increased by 28% sequentially to $14.3 per barrel [9][26] Market Data and Key Metrics Changes - Oil exports to Chile grew by 34% year-over-year, reaching 36,000 barrels per day, while natural gas production increased by 9% sequentially [19][20] - Local fuel prices increased by 2% sequentially and 1% year-over-year, with the company maintaining a market share of 56% [25][26] Company Strategy and Development Direction - The company has restructured its business segments, splitting the Gas and Power segment into LNG and Integrated Gas and New Energies, and reallocating midstream gas business [6] - The focus remains on increasing shale production and operational efficiency, with plans to replicate real-time intelligence centers across other refineries [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current uncertain price environment, indicating a breakeven level of $60 per barrel for EBITDA [37][39] - The company anticipates continued growth in shale production and aims to achieve an annual target of over 165,000 barrels per day [18][23] Other Important Information - The company signed multiple MOUs and agreements to advance LNG projects, with expectations for operational vessels by 2027 and 2028 [10][11][12] - CapEx for Q1 was $1,210 million, with 75% allocated to unconventional assets, aligning with the annual guidance of $5 billion to $5.2 billion [16][17] Q&A Session Summary Question: Current resilience amid price uncertainty and breakeven levels - Management indicated that every $10 reduction in oil prices impacts EBITDA by approximately $900 million, with a required CapEx of $2 billion to maintain current production levels [37][39] Question: Flexibility on CapEx and potential buyer financing issues - Management stated that they would adjust their plans if necessary but are currently not in a position to make drastic changes due to market volatility [42][43] Question: Impact of mature asset divestments on cash flow - The company reported a $230 million cash flow impact from mature assets, with expectations of minimal further impact as divestments progress [48][50] Question: Steps for final investment decisions on LNG projects - Management outlined that FID for the Southern Energy JV is expected by July, with ongoing processes for other LNG projects [51][52] Question: Fuel pricing strategy and market share expectations - The pricing strategy is aligned with international market conditions, and the company expects to maintain its market share despite price adjustments [56][57] Question: Update on Vaca Muerta Sur and pipeline negotiations - Management confirmed timelines for production increases and ongoing negotiations for gas pipeline investments, emphasizing the importance of favorable tariffs [60][62]

Financial Data and Key Metrics Changes - Revenues reached $19.3 billion in 2024, marking an 11% annual increase driven by rebounded fuel prices and a rise in oil exports [23] - Adjusted EBITDA totaled $4.7 billion in 2024, reflecting a 15% annual increase, mainly boosted by higher revenues in hydrocarbon production [23] - Net results improved substantially, posting a gain of $2.4 billion in 2024 compared to a loss of $1.3 billion in the previous year [24] - Net debt rose to $7.4 billion, a 9% increase from 2023, but the net leverage ratio was successfully reduced to 1.6 times [24][42] Business Line Data and Key Metrics Changes - In the upstream segment, total hydrocarbon production amounted to 536,000 barrels of oil equivalent per day in 2024, an increase of 4% versus 2023, with shale output representing 53% of the total [25] - Crude oil production reached 257,000 barrels per day, showing a 6% annual growth, while natural gas production grew 3% to 37.4 million cubic meters per day [26] - In the downstream segment, processing levels reached 301,000 barrels per day in 2024, a 2% increase from 2023, with a refined utilization rate of 92% [34] Market Data and Key Metrics Changes - YPF became the largest oil exporter in Argentina in 2024, with oil export revenues nearly tripling to around $1 billion, averaging 35,000 barrels per day [18] - The gap to import parity for fuel prices decreased from 20% in 2023 to just 2% in 2024, despite significant currency devaluation [18][34] - Fuel sales volumes decreased by 7% in 2024 to 13.9 million cubic meters, mainly due to exceptionally high demand in 2023 [34] Company Strategy and Development Direction - The company is focusing on increasing shale oil production share from 50% to a minimum of 80% and reallocating investments towards Vaca Muerta [5][6] - YPF is leading the development of midstream projects, including a new oil export pipeline, aiming to ramp up production to 180,000 barrels per day by the second half of 2026 [6] - The company is committed to exiting mature fields to eliminate losses and inefficiencies, with significant progress made in asset transfers [12][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving production targets, particularly in shale oil, and highlighted the importance of operational efficiencies [30][31] - The company anticipates sustained growth in 2025, focusing on its most profitable asset, shale oil from Vaca Muerta [17] - Management acknowledged challenges from mature fields and adverse weather conditions but remains optimistic about future performance [20][24] Other Important Information - The company reported a negative free cash flow of $760 million in 2024, impacted by mature fields and weather conditions [21][39] - YPF plans to hold an Investor Day on April 11 to present its five-year plan and key strategic drivers [44] Q&A Session Summary Question: Update on Vaca Muerta expansion and confidence in production targets - Management expressed confidence in delivering production targets by Q4 2026, citing strong partnerships and operational capabilities [47][50] Question: Current crude oil selling prices and CapEx reduction considerations - Management indicated that crude oil prices are aligned with import parity and emphasized a strategy to avoid price spikes [54][58] - CapEx adjustments will be considered if oil prices decline significantly, but the company is resilient to low prices [62] Question: Free cash flow expectations for 2025 and LNG project updates - Management confirmed plans for neutral cash flow in 2025 and provided a positive outlook on LNG projects [69][70] Question: Interest in potential M&A activity in Argentina - Management stated that while YPF is open to opportunities, there are currently no plans to acquire additional refineries [81][83]

Financial Data and Key Metrics Changes - Revenues reached $19.3 billion in 2024, marking an 11% annual increase driven by rebounded fuel prices and a rise in oil exports [26] - Adjusted EBITDA totaled $4.7 billion in 2024, reflecting a 15% annual increase, mainly boosted by higher revenues in hydrocarbon production [26] - Net results improved substantially, posting a gain of $2.4 billion in 2024 compared to a loss of $1.3 billion in the previous year [27] - Negative free cash flow of $760 million was reported in 2024, despite improved EBITDA [23][42] Business Line Data and Key Metrics Changes - In the upstream segment, total hydrocarbon production amounted to 536,000 barrels of oil equivalent per day in 2024, an increase of 4% versus 2023, with shale output representing 53% of the total [28][29] - Crude oil production reached 257,000 barrels per day, showing a 6% annual growth, while natural gas production grew 3% to 37.4 million cubic meters per day [29] - In the downstream segment, processing levels were 301,000 barrels per day in 2024, 2% higher than 2023, driven by refinery improvements [37] Market Data and Key Metrics Changes - YPF became the largest oil exporter in Argentina in 2024, with oil export revenues nearly tripling to around $1 billion [20] - The company maintained a strong fuel sales market share of 56% despite a 7% decrease in fuel sales volumes in 2024 [37] - The gap to import parity for fuel prices decreased from 20% in 2023 to just 2% in 2024 [20][36] Company Strategy and Development Direction - YPF is focusing on increasing shale oil production share from 50% to a minimum of 80% and reallocating investments towards Vaca Muerta [6][7] - The company is leading the development of midstream projects, including a new oil export pipeline, aiming to ramp up production to 180,000 barrels per day by the second half of 2026 [7][40] - A strategic exit from mature fields is underway to eliminate losses and focus on more profitable assets [14][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving production targets and emphasized the importance of operational efficiencies [54][75] - The company anticipates sustained growth in 2025, concentrating efforts on shale oil production [19] - Management acknowledged challenges from mature fields and adverse weather conditions but expects these issues to be resolved with the exit program [22][42] Other Important Information - YPF successfully issued multiple bonds in 2024, including a $1.1 billion international bond, to refinance existing debt and support operations [13][44] - The company plans to hold an Investor Day on April 11 to present its five-year plan and discuss key strategic initiatives [47] Q&A Session Summary Question: What is the expected ramp-up for Vaca Muerta expansion? - Management is confident in delivering 180,000 barrels by Q4 2026, citing strong partnerships and operational capabilities [50][54] Question: What are the current crude oil selling prices and CapEx considerations for 2025? - Management indicated that crude prices are aligned with import parity and emphasized resilience to low prices, with CapEx adjustments possible if prices decline significantly [57][66] Question: What is the free cash flow outlook for 2025? - Management confirmed plans for neutral cash flow in 2025, with further details to be provided at the Investor Day [74] Question: Update on LNG projects and lifting costs? - Management expressed optimism about LNG projects and highlighted ongoing efforts to maintain lifting costs through efficiency improvements [76]