Companies Bullish On Exploration Despite Slowdown

Oil and gas companies increased capital spending on exploration and development worldwide to $83 billion in 1998 in spite of a collapse in prices that hurt revenue, operating profits, and cash flow, according to a new survey by Arthur Andersen. The 182 publicly traded companies that were tracked account for 85% of U.S. reserves and include 51 headquartered outside the U.S. But, in spite of their setbacks, some companies were slow to trim budgets and spent 5% more than in 1997. Capital spending by the larger U.S. oil and gas groups fell by 15% while increasing by 22% in the rest of the world. Independents increased their spending by 7% in the U.S. while cutting back by 13% elsewhere.