(Alliance News) - TransGlobe Energy Corp on Wednesday revised its full-year production guidance following the fall in oil prices and the spread of the coronavirus.
The company now expects output between 13,300 and 14,300 barrels of oil per day, nudged lower from previous guidance which forecast production between 14,500 and 15,500 barrels.
The company's capital budget for 2020 has been sharply lowered. Its budgeted capital for 2020 is now USD7.1 million, including USD5.0 million for Egypt and USD2.1 million for Canada.
TransGlobe initially set its capital budget for 2020 at USD37.1 million, with Egypt's portion coming to USD23.7 million, and Canada's USD13.4 million.
Oil plunged on Monday after top exporter Saudi Arabia launched a price war in response to a failure by leading producers to strike a deal to support energy markets. This was after a failure by cartel OPEC and its allies to reach a deal to cut output.
On Monday afternoon, brent was quoted at USD36.02. The North Sea benchmark's year-to-date high is about USD71.
TransGlobe said: "Global reaction to the spread of covid-19 and the resultant reduction in oil demand has negatively affected current and future forecasts of oil prices in 2020. This has been compounded by OPEC+, led by Saudi Arabia and Russia, failing to reach an agreement on constraining output in face of lower global demand to support global oil prices and Saudi Arabia and Iraq's stated intention to discount April deliveries and increase supply into the market. Oil prices are now markedly lower than those the company used as the basis for its 2020 capital program."
TransGlobe shares were untraded at 70.50 pence each in London on Wednesday afternoon.
By Eric Cunha; ericcunha@alliancenews.com
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