BreitBurn Energy Partners LP on Thursday said it swung to loss in the fourth quarter partly because of lower energy sales and investment losses.
The independent Los Angeles oil and natural gas producer reported a loss of $39.7 million (75 cents a partnership unit), compared with net income of $251 million ($4.65) a year earlier.
The results included $36.9 million in losses related to commodity derivative investments, compared to $361 million in gains from those sources a year earlier. Total revenue plunged 91 percent to $38.3 million. Product sales were down 8 percent, with total production off 3.4 percent.
Analysts surveyed by Thomson Reuters on average expected per-share profit of 27 cents on revenue of $90 million.
BreitBurn last month settled a lawsuit with a major investor, Quicksilver Resources Inc., in which BreitBurn agreed to pay Quicksilver $13 million, which is expected to be covered by insurance. As part of the settlement, BreitBurn’s two founders stepped down from the board but retain top management roles. Hal Washburn continues as chief executive, but former co-CEO Randy Breitenbach’s title changed to president.
“Our primary goal in 2009 was to reduce our outstanding borrowings. In addition, we focused on controlling expenses and operating successfully with a significantly reduced capital spending program,” Washburn said in a press release. “With our improved financial flexibility, the recent resolution of the Quicksilver litigation, and the reinstatement of distributions … we can focus on cash flow generation from our portfolio of long-lived assets.”
For 2010, the company is projecting production of 6.3 million to 6.7 million barrels of oil equivalent, compared with 6.5 million last year. The company plans to spend significantly more money on capital project this year, between $72 million and $78 million compared with $27.8 million in 2009.
Shares were down 70 cents, or 4.5 percent, to $15.02 in midday trading on the Nasdaq.