El Paso Boasts Strong E&P Outlook, Eyes Bidders

By Energy FOXBusiness

El Paso (EP) revealed an optimistic outlook for its exploration and production business on Monday as it continues to seek potential suitors for the unit.

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The Houston-based company sees oil and natural gas reserves of approximately 4 trillion cubic feet equivalent at Dec. 31, an increase of 18% from the year-earlier period.

The forecast comes as the company engages with potential buyers for El Paso’s exploration and production assets, which was a part of Kinder Morgan’s (KMI) plan when it agreed to acquire El Paso in October.   

El Paso, which owns North America’s largest interstate natural gas pipeline system, is one of the region’s largest independent exploration and production companies.

“Our E&P business is completing a terrific year, and our results reflect the significant evolution of our asset base," said Brent Smolik, president of El Paso exploration & production.

The company said it sees year-end risked future drilling inventory of about 9.7 trillion cubic feet equivalent (Tcfe), up from 8 Tcfe a year ago, with the majority of the increase coming from oil shale program in Eagle Ford and Wolfcamp.

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Consistent with its existing guidance, El Paso predicts fiscal 2011 production of 830 to 840 million cubic equivalent feet per day, representing a 7% increase from 2010.

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