Newfield Exploration Company increased its 2011 capital budget to $1.9 billion from its original budget of $1.7 billion.

The budget excludes capitalized interest and overhead and the planned second quarter closing of the Company's previously announced $308 million acquisition in the Uinta Basin.

The increase in expenditures is substantially offset by increased cash flow from operations as a result of higher oil price realizations. The increase in planned investments is primarily related to the following:

• New and ongoing leasing of acreage in an undisclosed resource play • Increased service and labor costs throughout the Company's areas of operation • Efficiency gains in drilling • Capital investments in the Uinta Basin associated with the previously announced

Uinta Basin acquisition Newfield is in the process of selling certain non-strategic domestic assets. The planned sales are expected to be completed in the second half of 2011. The Company expects that proceeds will exceed $200 million.

2011 Production Newfield's production guidance for 2011 remains 312 - 323 Bcfe, an estimated increase of 8 - 12% over 2010 volumes. Second quarter 2011 production will be negatively impacted due to deferred production from Newfield's non-operated Abu field, located on PM 318 offshore Malaysia. The field is currently off-line due to a mechanical failure associated with FPSO operations. Repairs to the system are expected to take 60-90 days. Newfield estimates that the impact to its second quarter net oil production will be a reduction of approximately 0.2 MMBbls, which is included in its second quarter guidance as well as within the Company's unchanged production forecast for the full year.

Tags: Newfield Exploration Company