UPDATE 1-Newfield sees higher production, spending for oil

Mon Apr 26, 2010 4:53pm EDT

* Sees FY 2010 production at upper half of prev. view

* Says 45 pct of FY capex to be focused on oil

* Says domestic oil prod'n to grow 20 pct y-o-y

April 26 (Reuters) - Independent oil and gas explorer Newfield Exploration Co (NFX.N) forecast full-year production at the upper half of its previous outlook range, citing higher expected oil volumes.

The company's earlier 2010 production was 278 to 288 billion cubic feet equivalent of natural gas (bcfe).

Newfield said it expects to invest 45 percent of its planned 2010 capital budget, or $700 million, in oil projects, up from $200 million planned earlier.

The company said it was allocating additional capital to its oil activities in the Unita and Williston basins.

"Newfield's growing crude oil volumes are expected to account for about 60 percent of 2010 revenues," the company said.

Newfield also said its full-year domestic oil production was expected to grow 20 percent over 2009 levels.

Energy companies are increasingly focusing on oil to benefit from relatively high prices for the commodity, as slumping natural gas prices are expected to take a toll on so-far lucrative gas shale drilling. [ID:nN17188584] [ID:nN23251881]

Shares of Newfield, which reached a 21 month high of $58.10 on Monday, closed at $57.15 Monday on the New York Stock Exchange.

For the alerts, please double click [ID:nASA009IS] (Reporting by Arup Roychoudhury in Bangalore; Editing by Ratul Ray Chaudhuri)

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