Precision Drilling profit falls due to lower N American demand
(Reuters) - Precision Drilling Corp (PD.TO), Canada's largest oil and gas drilling contractor, reported a 16 percent decline in first-quarter earnings, as depressed natural gas prices prompted customers to cut back on drilling in North America.
The company's first-quarter earnings fell to C$93.3 million, or 33 Canadian cents per share, in the first quarter, from C$111.1 million, or 39 Canadian cents per share, a year earlier.
The fall in gas-directed drilling in the United States, which began in late 2011, continued through the first quarter of 2013, Chief Executive Kevin Neveu said in a statement.
Revenue fell 7 percent to C$595.7 million.
Drilling for natural gas has mostly been in decline for the last 18 months. The rig count is down about 60 percent since peaking at 936 in 2011, but production has not slowed from the record high hit last year.
Precision, which operates about a quarter of Canada's onshore drilling rigs, had recorded an impairment charge of C$192 million in the quarter ended December 31 related to the decommissioning of 52 drilling rigs.
The Calgary, Alberta-based company expects capital expenditure of C$533 million this year, up from the C$526 million it had earlier estimated in February.
Precision's shares closed at C$8.05 on Wednesday on the Toronto Stock Exchange.
(Reporting by Shounak Dasgupta in Bangalore; Editing by Sreejiraj Eluvangal)
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