Forest Oil Corp. (FST) said it plans to increase its drilling activity this year after increasing liquidity with the sale of noncore assets in 2009.
Shares were down 2.9% at $24.47 in recent trading amid profit-taking in commodity futures. The stock is up nearly 10% this month.
The natural-gas company plans to expand its drilling rig fleet to 20
by the end of the first quarter from 12 at the start of the year amid plans to boost 2010 capital spending by 18% to $600 million to $700 million.
Forest Oil expects 2010 organic production to rise as much as 2%, with sequential growth beginning in the second quarter. The company predicted growth of 10% to 12% for this year's fourth quarter.
President and Chief Executive H. Craig Clark said last year's divestitures of assets in Texas's Permian Basin and of other noncore properties will allow Forest Oil to focus the majority of its capital spending on areas such as its unconventional shale and gas sands projects. They include the Haynesville shale play in Texas and Louisiana, the site of significant drilling growth the past several years.
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