Coronavirus spending cuts spread to wider industry – the numbers

Matthew Farmer 26 March 2020 (Last Updated April 23rd, 2020 11:32)

Since Monday, several companies have announced cuts to capital expenditure in reaction to the coronavirus pandemic. Find out how much each has cut here.

Coronavirus spending cuts spread to wider industry – the numbers
Projects in Australia and the US maybe halted as companies make spending cuts due to the coronavirus pandemic. Credit: Phillips 66.

Since Monday, several oil and gas companies have announced cuts to capital expenditure in reaction to the coronavirus pandemic.

The resulting low oil price, compounded by the ongoing trade war between Russia and Saudi Arabia, has threatened earnings for extraction companies of all sizes.

This is going to be a rough year for oil producers, as worldwide storage is expected to start filling up, causing further deflation in prices.

Below is a chart of the companies which have, so far, announced they will make spending cuts due to coronavirus.

Capital Expenditure Of which…
Original budget New budget Value cut Percentage cut Operating cost cut Exploration budget cut Suspended share buyback? If yes, saving how much in 2020? Break-even cash flow barrel price
Marathon Oil $2,400,000,000 $1,900,000,000 $500,000,000 21%
Royal Dutch Shell $25,000,000,000 <$20,000,000,000 $5,000,000,000 20% $3,000,000,000 Yes $1,000,000,000
Total SA <$15,000,000,000 $3,000,000,000 20% $800,000,000 Yes $1,450,000,000 $25
Equinor ~$10,500,000,000 $8,500,000,000 $1,500,000,000 20% $700,000,000 $400,000 Yes $675,000,000 $25
Chevron $20,000,000,000 $16,000,000,000 $4,000,000,000 20% $700,000,000 Yes $3,750,000,000
Phillips 66 $3,800,000,000 $3,100,000,000 $700,000,000 18% $500,000,000 Yes ~$2,800,000,000*
Santos $1,450,000,000 $900,000,000 $550,000,000 38% $50,000,000 $25
Talos Energy $170,000,000 $20,000,000 “mid-$20s”
Saudi Aramco ~$37,500,000,000 <~$27,500,000,000 ~$10,000,000,000 27%
Occidental Petroleum ~$5,300,000,000 ~$2,800,000,000 $2,500,000,000 47% $600,000,000 $7
Eni $8,800,000,000 $6,600,000,000 $2,200,000,000 25% $400,000,000 Yes $1,000,000,000
Cairn Energy $615,000,000 $475,000,000 $140,000,000 23% $50,000,000
Devon Energy $1,800,000,000 $1,000,000,000 $800,000,000 45%
Sinopec ~$20,700,000,000 ~$20,190,000,000 $510,000,000 2.5%
Polarcus $7,000,000 $6,500,000
BP $16,000,000,000 $12,000,000,000 $4,000,000,000 25% $2,500,000,000
Tullow Oil $500,000,000 $300,000,000 $200,000,000 40% <$12
Apache $2,400,000,000 $1,100,000,000 $1,300,000,000 54% $150,000,000
Petrofac $150,000,000 $90,000,000 $60,000,000 40% $100,000,000
ExxonMobil $33,000,000,000 ~$23,000,000,000 $10,000,000,000 30% “15%”
Jadestone Energy ~$150,000,000 ~$32,500,000 ~$127,500,000 80% $25
Running total: $47,264,500,000 *Note: Phillips buyback saving is based on 2019 spending minus 2020 spending to date

 


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