NEW YORK (AP) -- Bill Barrett Corp. shares tumbled Friday after the company announced plans to dramatically cut its capital spending this year.
THE SPARK: The Denver-based company expects its 2013 capital expenditures to total between $475 million and $525 million. The plan represents a drop of more than $400 million from 2012 spending levels, the company said.
THE BIG PICTURE: Bill Barrett sees 2013 production between 83 billion and 87 billion cubic feet equivalent, with nearly 30 percent expected in the form of oil. That's about 55 percent growth in oil production compared with 2012, when adjusted for the sale of its interest in a property late last year.
Fred Barrett, the company's chairman, president and CEO, said that for the past two years the company's capital plans have focused on building up its two core oil development programs. As a result, Bill Barrett can now shift its focus to developing established assets and inventory.
Barrett added that the company is dedicated to managing its debt levels and plans to fund its capital spending program through cash flow, proceeds from a recent asset sale and further asset sales to come.
THE SHARES: Down $1.16, or 6 percent, to $18.05 in afternoon trading, after dropping as low as $17.79 earlier in the day. Over the past 52 weeks, the company's shares have traded between $15.42 and $36.02. During 2012, Bill Barrett shares lost about 48 percent of their value.