UPDATE 1-Canada's Penn West Petroleum gross revenue falls 5 pct

Thu May 1, 2014 7:36am EDT

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May 1 (Reuters) - Canadian oil and gas producer Penn West Petroleum Ltd reported a 5 percent fall in gross revenue after production decreased 22 percent.

Gross revenue, which includes realized gains and losses on commodity contracts, fell to C$668 million ($608 million) in the quarter ended Mar. 31 from C$704 million a year earlier.

Net loss narrowed marginally to C$96 million from C$97 million but was flat at 20 Canadian cents on a per-share basis.

Operating expenses fell 19 percent.

Total production fell to 110,795 barrels of oil equivalent per day (boe/d).

The company maintained its 2014 average production forecast of 101,000-106,000 boe/d.

Penn West is one of Canada's largest conventional oil producers with around 5 million acres of exploration land in Western Canada and 625 million barrels of reserves.

Penn West's funds flow, a key measure of its ability to pay for new projects and drilling, rose 4.5 percent to C$279 million, or 57 Canadian cents per share, from C$267 million, or 55 Canadian cents per share, a year earlier.

The company's shares have dropped by more than half since the start of 2012 as production declined. Its rich dividend payouts drained the cash needed to boost output.

Last year the company named a former Marathon Oil Corp executive David Roberts as CEO and said it would slash its dividend, cut 10 percent of its staff and review strategic options such as asset sales and joint ventures. ($1 = 1.0975 Canadian Dollars) (Reporting by Ashutosh Pandey in Bangalore; Editing by Don Sebastian)

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