Delaware | 001-07964 | 73-0785597 | ||
(State or other jurisdiction of incorporation or organization) | Commission File Number | (I.R.S. Employer Identification No.) | ||
1001 Noble Energy Way, Houston, Texas | 77070 | |||
(Address of principal executive offices) | (Zip Code) | |||
Registrant’s telephone number, including area code: (281) 872-3100 | ||||
(Former name, former address and former fiscal year, if changed since last report) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act: | ||||
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Common Stock, $0.01 par value | NBL | New York Stock Exchange |
(d) | Exhibits. The following exhibits are furnished as part of this Current Report on Form 8-K: |
NOBLE ENERGY, INC. | ||||||
Date: | May 3, 2019 | By: | /s/ Kenneth M. Fisher | |||
Kenneth M. Fisher | ||||||
Executive Vice President, Chief Financial Officer |
NEWS RELEASE | |||
• | Organic capital expenditures funded by Noble Energy totaled $683 million, below the low end of guidance, a result of lower spend in the U.S. onshore and Israel. |
• | Delivered total Company sales volumes of 337 MBoe/d and U.S. onshore volumes of 253 MBoe/d, exceeding the top end of guidance. |
• | Produced a quarterly record in the DJ Basin of 144 MBoe/d, driven by strong base performance and Mustang IDP growth. |
• | Progressed Leviathan to 81% complete, with first gas sales expected by the end of 2019. |
• | Sanctioned the Alen gas monetization project in Equatorial Guinea with initial sales planned for the first half of 2021. |
• | Farmed into two exploration blocks offshore Colombia; Noble Energy operates the blocks with a 40% working interest. |
• | Noble Midstream Partners closed its options with EPIC Midstream Holdings to acquire a 15% equity interest in the Y-grade pipeline and a 30% equity interest in the crude oil pipeline. |
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Revenues | |||||||
Oil, NGL and Gas Sales | $ | 937 | $ | 1,173 | |||
Sales of Purchased Oil and Gas | 74 | 53 | |||||
Income from Equity Method Investees | 17 | 47 | |||||
Midstream Services Revenues – Third Party | 24 | 13 | |||||
Total Revenues | 1,052 | 1,286 | |||||
Operating Expenses | |||||||
Lease Operating Expense | 151 | 155 | |||||
Production and Ad Valorem Taxes | 49 | 54 | |||||
Gathering, Transportation and Processing Expense | 102 | 93 | |||||
Other Royalty Expense | 3 | 17 | |||||
Exploration Expense | 24 | 35 | |||||
Depreciation, Depletion and Amortization | 508 | 468 | |||||
General and Administrative | 102 | 104 | |||||
Cost of Purchased Oil and Gas | 87 | 57 | |||||
Other Operating Expense, Net | 25 | 15 | |||||
Gain on Divestitures, Net | — | (588 | ) | ||||
Asset Impairments | — | 168 | |||||
Firm Transportation Exit Cost | 92 | — | |||||
Total Operating Expenses | 1,143 | 578 | |||||
Operating (Loss) Income | (91 | ) | 708 | ||||
Other Expense | |||||||
Loss on Commodity Derivative Instruments | 212 | 79 | |||||
Interest, Net of Amount Capitalized | 66 | 73 | |||||
Other Non-Operating Expense, Net | 4 | 13 | |||||
Total Other Expense | 282 | 165 | |||||
(Loss) Income Before Income Taxes | (373 | ) | 543 | ||||
Income Tax Benefit | (84 | ) | (31 | ) | |||
Net (Loss) Income and Comprehensive (Loss) Income Including Noncontrolling Interests | (289 | ) | 574 | ||||
Less: Net Income and Comprehensive Income Attributable to Noncontrolling Interests (1) | 24 | 20 | |||||
Net (Loss) Income and Comprehensive (Loss) Income Attributable to Noble Energy | $ | (313 | ) | $ | 554 | ||
Net (Loss) Income Attributable to Noble Energy Per Share of Common Stock | |||||||
(Loss) Income Per Share, Basic | $ | (0.65 | ) | $ | 1.14 | ||
(Loss) Income Per Share, Diluted | $ | (0.65 | ) | $ | 1.14 | ||
Weighted Average Number of Shares Outstanding | |||||||
Basic | 478 | 487 | |||||
Diluted | 478 | 488 |
(1) | The Company consolidates Noble Midstream Partners LP (NBLX), a publicly traded subsidiary of Noble Energy, as a variable interest entity for financial reporting purposes. The public's ownership interest in NBLX is reflected as a noncontrolling interest in the financial statements. |
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Cash Flows From Operating Activities | |||||||
Net (Loss) Income Including Noncontrolling Interests (1) | $ | (289 | ) | $ | 574 | ||
Adjustments to Reconcile Net (Loss) Income to Net Cash Provided by Operating Activities | |||||||
Depreciation, Depletion and Amortization | 508 | 468 | |||||
Gain on Divestitures, Net | — | (588 | ) | ||||
Asset Impairments | — | 168 | |||||
Firm Transportation Exit Cost | 92 | — | |||||
Deferred Income Tax Benefit | (100 | ) | (157 | ) | |||
Loss on Commodity Derivative Instruments | 212 | 79 | |||||
Net Cash Received (Paid) in Settlement of Commodity Derivative Instruments | 14 | (28 | ) | ||||
Other Adjustments for Noncash Items Included in Income | 28 | (2 | ) | ||||
Net Changes in Working Capital | 63 | 69 | |||||
Net Cash Provided by Operating Activities | 528 | 583 | |||||
Cash Flows From Investing Activities | |||||||
Additions to Property, Plant and Equipment | (763 | ) | (787 | ) | |||
Acquisitions, Net of Cash Received (2) | — | (650 | ) | ||||
Additions to Equity Method Investments (3) | (271 | ) | — | ||||
Proceeds from Divestitures, Net (4) | 123 | 865 | |||||
Net Cash Used in Investing Activities | (911 | ) | (572 | ) | |||
Cash Flows From Financing Activities | |||||||
Dividends Paid, Common Stock | (53 | ) | (48 | ) | |||
Purchase and Retirement of Common Stock | — | (67 | ) | ||||
Noble Midstream Services Revolving Credit Facility, Net | 170 | 350 | |||||
Revolving Credit Facility, Net | — | (230 | ) | ||||
Contributions from Noncontrolling Interest Owners | 10 | 333 | |||||
Proceeds from Issuance of Mezzanine Equity, Net of Offering Costs (5) | 99 | — | |||||
Other | (32 | ) | (40 | ) | |||
Net Cash Provided by Financing Activities | 194 | 298 | |||||
(Decrease) Increase in Cash, Cash Equivalents, and Restricted Cash | (189 | ) | 309 | ||||
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period (6) | 719 | 713 | |||||
Cash, Cash Equivalents, and Restricted Cash at End of Period (7) | $ | 530 | $ | 1,022 |
(1) | The Company consolidates Noble Midstream Partners LP (NBLX), a publicly traded subsidiary of Noble Energy, as a variable interest entity for financial reporting purposes. For the three months ended March 31, 2019, Net (Loss) Income includes Net Income Attributable to Noncontrolling Interests in NBLX. |
(2) | For the three months ended March 31, 2018, acquisitions, net of cash received, related to 100 percent of the acquisition of Saddle Butte Rockies Midstream, LLC by NBLX. |
(3) | For the three months ended March 31, 2019, additions related to initial investments in the EPIC Pipelines and Delaware Crossing Joint Venture by NBLX. |
(4) | For the three months ended March 31, 2019, proceeds related to the SW Reeves County, Texas asset divestiture. For the three months ended March 31, 2018, proceeds include $487 million from the sale of our 7.5% interest in Tamar field and $308 million from the sale of CONE Gathering LLC. |
(5) | For the three months ended March 31, 2019, proceeds related to the issuance of preferred equity by NBLX. As the preferred equity is redeemable, it is presented within the mezzanine section of our consolidated balance sheet. In addition, as the preferred equity is held by a third party, it is considered a redeemable noncontrolling interest. |
(6) | As of the beginning of the periods presented, amounts include $3 million and $38 million of restricted cash, respectively. |
(7) | As of March 31, 2019 and March 31, 2018, amounts include $2 million and $30 million of restricted cash, respectively. |
March 31, 2019 | December 31, 2018 | ||||||
Assets | |||||||
Current Assets | |||||||
Cash and Cash Equivalents | $ | 528 | $ | 716 | |||
Accounts Receivable, Net | 573 | 616 | |||||
Other Current Assets | 142 | 418 | |||||
Total Current Assets | 1,243 | 1,750 | |||||
Net Property, Plant and Equipment | 18,701 | 18,419 | |||||
Other Noncurrent Assets | 1,376 | 841 | |||||
Total Assets | $ | 21,320 | $ | 21,010 | |||
Liabilities, Mezzanine Equity and Shareholders' Equity | |||||||
Current Liabilities | |||||||
Accounts Payable - Trade | $ | 1,284 | $ | 1,207 | |||
Other Current Liabilities | 659 | 519 | |||||
Total Current Liabilities | 1,943 | 1,726 | |||||
Long-Term Debt | 6,738 | 6,574 | |||||
Deferred Income Taxes | 961 | 1,061 | |||||
Other Noncurrent Liabilities | 1,438 | 1,165 | |||||
Total Liabilities | 11,080 | 10,526 | |||||
Total Mezzanine Equity (1) | 97 | — | |||||
Total Shareholders' Equity | 9,071 | 9,426 | |||||
Noncontrolling Interests (2) | 1,072 | 1,058 | |||||
Total Equity | 10,143 | 10,484 | |||||
Total Liabilities and Equity | $ | 21,320 | $ | 21,010 |
(1) | Amount relates to preferred equity issued by Noble Midstream Partners LP (NBLX). As the preferred equity is redeemable, it is presented within the mezzanine section of our consolidated balance sheet. In addition, as the preferred equity is held by a third party, it is considered a redeemable noncontrolling interest. |
(2) | The Company consolidates NBLX, a publicly traded subsidiary of Noble Energy, as a variable interest entity for financial reporting purposes. The public's ownership interest in NBLX is reflected as a noncontrolling interest in the financial statements. |
Three Months Ended March 31, | |||||||
Sales Volumes | 2019 | 2018 | |||||
Crude Oil and Condensate (MBbl/d) | |||||||
United States Onshore | 113 | 103 | |||||
United States Gulf of Mexico | — | 19 | |||||
Equatorial Guinea | 12 | 15 | |||||
Equity Method Investee - Equatorial Guinea | 1 | 2 | |||||
Total (1) | 127 | 139 | |||||
Natural Gas Liquids (MBbl/d) | |||||||
United States Onshore | 59 | 63 | |||||
United States Gulf of Mexico | — | 1 | |||||
Equity Method Investee - Equatorial Guinea | 4 | 5 | |||||
Total | 63 | 69 | |||||
Natural Gas (MMcf/d) | |||||||
United States Onshore | 483 | 482 | |||||
United States Gulf of Mexico | — | 22 | |||||
Israel | 233 | 261 | |||||
Equatorial Guinea | 168 | 206 | |||||
Total | 884 | 971 | |||||
Total Sales Volumes (MBoe/d) | |||||||
United States Onshore | 253 | 246 | |||||
United States Gulf of Mexico | — | 24 | |||||
Israel | 39 | 44 | |||||
Equatorial Guinea | 40 | 49 | |||||
Equity Method Investee - Equatorial Guinea | 5 | 7 | |||||
Total Sales Volumes (MBoe/d) | 337 | 370 | |||||
Total Sales Volumes (MBoe) | 30,375 | 33,272 | |||||
Price Statistics - Realized Prices (2) | |||||||
Crude Oil and Condensate ($/Bbl) | |||||||
United States Onshore | $ | 53.46 | $ | 61.50 | |||
United States Gulf of Mexico | — | 64.55 | |||||
Equatorial Guinea | 61.01 | 68.14 | |||||
Natural Gas Liquids ($/Bbl) | |||||||
United States Onshore | $ | 17.86 | $ | 25.47 | |||
United States Gulf of Mexico | — | 28.41 | |||||
Natural Gas ($/Mcf) | |||||||
United States Onshore | $ | 2.49 | $ | 2.60 | |||
United States Gulf of Mexico | — | 3.54 | |||||
Israel | 5.57 | 5.48 | |||||
Equatorial Guinea | 0.27 | 0.27 |
(1) | Total includes a small amount of condensate from the Company’s offshore Israel assets. |
(2) | Average realized prices do not include gains or losses on commodity derivative instruments. |
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Net (Loss) Income Attributable to Noble Energy (GAAP) | $ | (313 | ) | $ | 554 | ||
Adjustments to Net (Loss) Income | |||||||
Firm Transportation Exit Cost | 92 | — | |||||
Gain on Divestitures, Net | — | (588 | ) | ||||
Asset Impairments | — | 168 | |||||
Loss on Investment in Tamar Petroleum Ltd., Net | — | 29 | |||||
Loss on Commodity Derivative Instruments, Net of Cash Settlements | 226 | 51 | |||||
Other Adjustments | 19 | 18 | |||||
Total Adjustments Before Tax | 337 | (322 | ) | ||||
Current Income Tax Effect of Adjustments (1) | (3 | ) | 97 | ||||
Deferred Income Tax Effect of Adjustments (1) | (65 | ) | (12 | ) | |||
Tax Reform Impact (2) | — | (145 | ) | ||||
Adjusted Net (Loss) Income Attributable to Noble Energy (Non-GAAP) | $ | (44 | ) | $ | 172 | ||
Net (Loss) Income Attributable to Noble Energy Per Share, Basic and Diluted (GAAP) | $ | (0.65 | ) | $ | 1.14 | ||
Firm Transportation Exit Cost | 0.19 | — | |||||
Gain on Divestitures, Net | — | (1.21 | ) | ||||
Asset Impairments | — | 0.34 | |||||
Loss on Investment in Tamar Petroleum Ltd., Net | — | 0.06 | |||||
Loss on Commodity Derivative Instruments, Net of Cash Settlements | 0.47 | 0.10 | |||||
Other Adjustments | 0.04 | 0.05 | |||||
Current Income Tax Effect of Adjustments (1) | — | 0.20 | |||||
Deferred Income Tax Effect of Adjustments (1) | (0.14 | ) | (0.03 | ) | |||
Tax Reform Impact (2) | — | (0.30 | ) | ||||
Adjusted (Loss) Income Attributable to Noble Energy per Share, Diluted (Non-GAAP) | $ | (0.09 | ) | $ | 0.35 | ||
Weighted Average Number of Shares Outstanding, Basic | 478 | 487 | |||||
Weighted Average Number of Shares Outstanding, Diluted | 478 | 488 |
(1) | Amount represents the income tax effect of adjustments, determined for each major tax jurisdiction for each adjusting item, including the impact of timing and magnitude of divestiture activities. |
(2) | During first quarter 2018, we recorded a $145 million tax benefit as a result of the U.S. Department of the Treasury and the Internal Revenue Service intent to issue additional regulatory guidance associated with Tax Reform Legislation and the transition tax (toll tax). |
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Net (Loss) Income Including Noncontrolling Interests (GAAP) | $ | (289 | ) | $ | 574 | ||
Adjustments to Net (Loss) Income, After Tax (1) | 269 | (382 | ) | ||||
Depreciation, Depletion and Amortization | 508 | 468 | |||||
Exploration Expense | 24 | 35 | |||||
Interest, Net of Amount Capitalized | 66 | 73 | |||||
Current Income Tax Expense (2) | 19 | 13 | |||||
Deferred Income Tax Benefit (2) | (35 | ) | 16 | ||||
Adjusted EBITDAX (Non-GAAP) | $ | 562 | $ | 797 |
(1) | See Reconciliation of Net (Loss) Income Attributable to Noble Energy (GAAP) to Adjusted Net (Loss) Income Attributable to Noble Energy (Non-GAAP). |
(2) | Represents remaining Income Tax Expense (Benefit) after reversal of Adjustments to Net (Loss) Income, After Tax, above. |
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Organic Capital Expenditures, Attributable to Noble Energy (Accrual Based) (1) | $ | 683 | $ | 777 | |||
Acquisition Capital Attributable to Noble Energy | 39 | 4 | |||||
Noble Midstream Partners Capital Expenditures (2) | 29 | 345 | |||||
Investment in Equity Method Investees (3) | 271 | — | |||||
Increase in Finance Lease Obligations | 2 | — | |||||
Total Reported Capital Expenditures (Accrual Based) | $ | 1,024 | $ | 1,126 |
(1) | For the three months ended March 31, 2019 and March 31, 2018, organic capital expenditures include $37 million and $110 million for midstream capital not funded by Noble Midstream Partners LP (NBLX), respectively. |
(2) | NBLX capital expenditures for the three months ended March 31, 2018 include $206 million related to the 100 percent acquisition of Saddle Butte Rockies Midstream, LLC. |
(3) | Investment in equity method investees includes primarily NBLX investments of $227 million in EPIC Y-Grade, LP and EPIC Crude Holdings, LP and $38 million in Delaware Crossing LLC. |
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