February 4, 2020 / 2:12 PM / 21 days ago

UPDATE 1-Cabot to drill fewer wells this year as gas prices remain weak

(Adds forecast details)

Feb 4 (Reuters) - Cabot Oil & Gas Corp said on Tuesday it expects to reduce its drilling and completion activity in 2020, as a glut of shale gas keeps prices for the heating fuel at over two-decade lows.

The company said it plans to spend about $575 million in 2020, much lower than its 2019 capital budget of $800 to $820 million.

Cabot will evaluate further reductions in spending if prices continue to erode, Chief Executive Officer Dan Dinges said in a statement.

The move to cut spending comes when the world's largest oil companies face investor pressure to increase returns and cut down on investment to boost crude production.

Cabot gets a bulk of its revenue from natural gas, which is a by-product of oil drilling. The company said it now expects production to be about 2,457 million cubic feet equivalent (Mmcfe) per day in the quarter, higher than its previous guidance of 2,375 to 2,425 Mmcfe per day.

The Houston, Texas-based company said it expects an average net production rate of about 2.4 billion cubic feet (Bcf) per day for 2020.

Cabot is expected to report fourth-quarter results on Feb. 20. (Reporting by Shradha Singh and Arundhati Sarkar in Bengaluru; Editing by Maju Samuel)

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