Australian energy firm Senex reduced its output targets for 2014-2015 amidst declining oil prices, The Sydney Morning Herald reported. The oil and gas company announced it would revise its initial projection from at least 1.4 million barrels of oil equivalent to between 1.36 million and 1.4 million boe.
The change to the forecast means this year's output levels will be on par with the 1.38 million boe produced last year. In a March 2015 report, Senex said it would halt operations at three oil wells: Martlet North-1, Growler-14 and Dunoon-3. However, production from these wells could begin in the first quarter of next year. The company would also lower its capital expenditure guidance down to $80 million to $85 million for the fiscal year 2015.
Senex's announcement was not a surprise to oil production analysts because of the high cost of production in the market climate.
"It's probably a bit of a disappointment given very aggressive rhetoric in the first half of the year but it's sensible not to chase a target when it's a different oil price environment," said Martin Kronborg, analyst at Credit Suisse, according to the Morning Herald.