Unit Petroleum losses in 2019 totaled $554 million

Tulsa’s Unit Corporation reported losses of $335 million or $6.33 per diluted share in the fourth quarter of 2019 and $553.9 million or $10.48 per diluted share for the year.

The 2019 losses compared to $45.3 million or 87-cents per diluted share for 2018 and came despite a 12% year-over-year increase in oil production and a fourth quarter cut of lease operating expense by 10%. Unit said it also completed a sale of non-core eastern Oklahoma gas properties with proceeds of $18 million.

“We suspended our operated drilling rig program at the beginning of the third quarter, and we are not operating any drilling rigs at this time. We have continued our participation in non-operated wells in the Mid-Continent region, participating in 61 such wells with an average working interest of approximately 4%. In December of 2019, we sold our Panola Field in eastern Oklahoma for $18 million,” said Larry Pinkston, Chief Executive Officer and President.

Unit started 2019 with 32 drilling rigs including four rigs running for Unit Petroleum. But by the end of August, the company had dropped to 18 drilling rigs and remained there into early December before finishing the year at 20 operating drilling rigs.

During the year, Unit completed the acquisition of Central Oklahoma assets consisting of 600 miles of pipeline and compressor stations in December 2019. It’s gas gathered increased 11% while the gas processed volumes grew by 4% compared to 2018.

However total equivalent production was down 5% from the third quarter while oil production dropped 6% from the previous quarter. Natural gas production in the fourth quarter dropped 2% from the previous quarter while total natural gas production for 2019 fell 1% compared to 2018.

In the Southern Oklahoma Hoxbar Oil Trend (SOHOT) and the Red Fork plays in western Oklahoma, 14 horizontal wells were completed in 2019. This mix of Marchand and Red Fork wells enabled the company to increase its oil production percentage. Annual production from western Oklahoma averaged 95.7 MMcfe per day (35% oil, 22% NGLs, and 43% natural gas).

In the Wilcox play in Southeast Texas, seven vertical natural gas and condensate wells were completed in 2019. Annual production from the Wilcox play averaged 76 MMcfe per day (7% oil, 21% NGLs, and 72% natural gas). In addition to the new wells, the company continued its recompletion program.

In the Granite Wash play, two extended length lateral horizontal wells were completed in 2019. Annual production from the Texas panhandle averaged 91.9 MMcfe per day (9% oil, 37% NGLs, and 55% natural gas).

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Source: Unit Petroleum