Berry Petroleum Co., owner of the Placerita oil field off of Sierra Highway – and significantly larger fields in Kern County, West Texas, Utah and Colorado – posted adjusted second-quarter profits of $41 million (73 cents per diluted share), dead-even with the year-ago figure and up markedly from the first quarter of 2013.
Berry was supposed to merge by June 30 into an affiliate of Linn Energy, one of the nations’ top-15 oil and natural gas companies. But the merger requires SEC approval, and it has been tied up since the SEC launched an informal inquiry into Linn’s hedging strategy.
It’s not a done deal. Berry’s stock price has drifted back to pre-announcement levels.
Meantime, the second quarter saw Berry increase its oil-to-gas ratio to 80 percent oil from 74 percent a year earlier as natural gas prices plummeted to record-low levels.
In Kern County, Berry’s production increased by 12 percent at McKittrick, where the company drilled 45 new steam-injection wells as part of its “continuing focus to expand the steam flood development.” The McKittrick field yielded an average 2,645 barrels per day for Berry during the second quarter.
Berry’s historic South Midway property in Kern County produced 12,395 barrels per day with 10 new wells drilled. Berry plans to drill 17 more in that field during the third quarter, although the company expects production at South Midway to fall by 5 percent to 8 percent over the course of 2013.
Berry’s total second-quarter production averaged 39,529 barrels per day, an increase of 12 percent over second-quarter 2012. Of that amount, oil accounted for 31,456 daily barrels and the rest was natural gas.
Berry started injecting old wells at Placerita with steam in 2011 in order to boost production to 2,300 barrels per day. Production started in 1948 on Berry’s Placerita property.
Linn Energy has about 4.8 trillion cubic feet of natural gas equivalent. By comparison, Berry’s proved reserves include 534 billion cubic feet of natural gas and 186 million barrels of liquids, for a combined total of 275 million barrels of oil equivalent.
Berry Boosts Oil Production by 12% as Merger Awaits
