Denbury Resources Inc. recently released its capital budget and estimated production for 2017. This apart, the company reported the proved reserves as well as preliminary production and capital expenditure for 2016.

The company has estimated 2017 capital budget at about $300, up 44% from the 2016 capital spending level. Of the total, $175 million has been allocated for tertiary oil field, $60 million for other areas (mainly non-tertiary oil fields), $10 million for CO2 sources and pipelines. The balance $55 million is apportioned for other capital items. Currently, capitalized interest for 2017 is expected to be about $20 million.

Denbury anticipates 2017 production in the range of 58,000–62,000 barrels of oil equivalent per day (BOE/d). The mid-point of this range is likely to be almost flat with the company’s 2016 exit rate of just below 60,000 BOE/d.

During the fourth quarter of 2016, Denbury’s production averaged 60,685 BOE/d. Of this, oil was 96% and CO2 tertiary properties accounted for 62%. Total production was mostly flat sequentially with production from CO2 tertiary properties increasing slightly.

For full-year 2016, Denbury’s continuing production, excluding sold properties averaged 62,998 BOE/d, down 11% from the prior year. Production shut-in due to economics and weather-related issues at Thompson and Conroe fields resulted in about one-third of the production decline, while the remainder was primarily due to natural production decreases.  

In 2016, Denbury’s development capital expenditures totaled $209 million, of which $206 million was spent on oil and natural gas development, including $56 million related to capitalized internal acquisition, exploration and development costs and pre-production tertiary start-up costs. The remainder was balance spent mainly on CO2 source wells and CO2 infrastructure and pipelines.  

At the end of 2016, Denbury’s total proved reserves were 254 million barrels of oil equivalent (MMBOE), down 12% from 289 MMBOE in the previous year. The reserves comprised 97% liquids and 82% proved developed, with 58% of these reserves attributable to Denbury’s CO2 tertiary operations.

Denbury’s prospects look bright and this is reflected in its price movement as well. Shares of the company gained 17.6% in the last three months. On the other hand, the Zacks categorized Oil & Gas-U.S. Exploration & Production industry has gained 3.4% in the same time period.

Denbury currently sports a Zacks Rank #1 (Strong Buy). Some better-ranked players in the same space include Northern Oil and Gas, Inc. (NOG Quick QuoteNOG - Free Report) , Holly Energy Partners LP and Sunrun Inc. (RUN Quick QuoteRUN - Free Report) . All these stocks sport the same Zacks Rank as Denbury. You can see the complete list of today’s Zacks #1 Rank stocks here.

Northern Oil and Gas posted positive earnings surprises in the last three of the four reported quarters. It had an average earnings surprise of 81.35% in the four trailing quarters.

Holly Energy Partners posted a negative earnings surprise of 23.26% in the preceding quarter. It had an average negative earnings surprise of 0.96% in the four trailing quarters.

Sunrun posted a positive earnings surprise of 137.21% in the preceding quarter. It beat estimates in all the four preceding quarters and has an average positive earnings surprise of 134.71% in the four trailing quarters.

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