Unit Corporation (NYSE: UNT) announced today that it is increasing its
2015 year over year production growth guidance for its oil and natural
gas segment to 6-8% from its previous guidance of 2-4%. Unit's 2015
capital expenditures are expected to be approximately $30 million less
than originally budgeted with the reduction primarily attributable to
its oil and natural gas segment.
In its second quarter 2015 earnings release, Unit stated that it had
been notified of a customer's intent to early terminate two of its BOSS
drilling rig contracts. Unit is in discussions with the customer and it
appears likely that they will keep one of the BOSS drilling rigs through
its remaining term. Unit has recently contracted the other BOSS drilling
rig to a third party operator.
Unit's lenders recently completed their regularly scheduled semi-annual
borrowing base redetermination under its credit agreement. Unit's
borrowing base was determined to be $550 million, which remains above
its elected commitment level of $500 million. No other terms under the
credit agreement changed as a result of the redetermination and the
company is fully in compliance with the financial covenants in the
credit agreement. Unit has elected to maintain its elected commitment
amount at $500 million, which it believes meets the company's financing
needs during this current commodity cycle. At September 30, 2015, Unit
had $261.7 million outstanding under its credit agreement, which is a
reduction of $18.8 million from the amount outstanding at June 30, 2015.
Unit anticipates its 2016 capital expenditure budget to be within
anticipated cash flow.
Larry Pinkston, Unit's Chief Executive Officer and President, said: "Due
to strong well results primarily in our SOHOT, Wilcox and our Granite
Wash plays, we are increasing our production guidance for 2015. We are
also reducing our anticipated capital expenditures in this segment for
2015 because of the efficiencies we have captured. We believe how
quickly the BOSS drilling rigs are returning to work in this challenging
commodity cycle is a testament to their quality and performance.
Finally, we believe the new borrowing base provides us with ample
liquidity, and we are confident that we will remain in compliance with
all financial covenants of our long-term debt agreements during the
course of this cycle."
Unit Corporation is a Tulsa-based, publicly held energy company engaged
through its subsidiaries in oil and gas exploration, production,
contract drilling, and gas gathering and processing. Unit's Common Stock
is on the New York Stock Exchange under the symbol UNT. For more
information about Unit Corporation, visit its website at http://www.unitcorp.com.
This news release contains forward-looking statements within the meaning
of the private Securities Litigation Reform Act. All statements, other
than statements of historical facts, included in this release that
address activities, events, or developments that the company expects or
anticipates will or may occur in the future are forward-looking
statements. Several risks and uncertainties could cause actual results
to differ materially from these statements, including the productive
capabilities of the company's wells, projected growth of the company's
oil and natural gas production, oil and gas reserve information, and its
ability to meet its obligations under its long-term debt agreements,
anticipated oil and natural gas prices, the number of wells to be
drilled by the company's oil and natural gas segment, development,
operational, implementation, and opportunity risks, and other factors
described from time to time in the company's publicly available SEC
reports. The company assumes no obligation to update publicly such
forward-looking statements, whether because of new information, future
events, or otherwise.
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Michael D. Earl, 918-493-7700