Pioneer Natural Resources (PXD) Reports Impact to Q3 Production Due to Recent Hurricanes

September 18, 2008 4:36 PM EDT

Pioneer Natural Resources Company (NYSE: PXD) has completed a preliminary assessment of the impact of hurricanes Gustav and Ike on its operations. The following areas of Louisiana and Texas were adversely impacted:

Spraberry – Pioneer’s Spraberry facilities in West Texas were not directly impacted by either hurricane. This field produces oil and associated liquid-rich gas. The gas includes natural gas liquids (NGLs) which are separated at various Permian Basin plants. These NGLs are then transported to a third-party facility in Mont Belvieu, Texas for fractionation. This facility sustained power interruptions and physical damage from Hurricane Ike. As a result, at least 10% to 15% of Pioneer’s Spraberry and other Permian area total net production of approximately 34,000 barrels of oil equivalent per day (BOEPD) has been curtailed or shut in since September 12.

Gulf of Mexico Shelf – Pioneer’s remaining shallow-water offshore platforms did not experience any significant damage as a result of the hurricanes. However, production of approximately 2,000 BOEPD has been shut in since August 31 due to the significant damage that has been incurred by the third-party pipeline facilities utilized to transport production to shore. No estimates are currently available as to when these facilities will be operational.

In addition to the aforementioned hurricane impacts, Pioneer’s third quarter production has also been impacted by the following third-party maintenance activities:

Scheduled maintenance at the third-party onshore production facilities on the North Slope of Alaska where Pioneer’s Oooguruk oil production is processed has taken longer than expected. Assuming that the production facilities are back on line by the end of this week, estimated net production of 2,000 barrels of oil per day will have been delayed by approximately 20 days.

Compression facilities on the third-party pipeline serving the Raton gas field in southeastern Colorado required unexpected maintenance. Pioneer expected net production in the third quarter of 2008 to average approximately 200 MMCFPD, but the expectation is now for production to be closer to 195 MMCFPD. [SM]

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