Soco International slashes 2015 expenditure budget, shares drop

Oil firm Soco International revealed on Thursday that it has slashed its investment budget by more than 60% from 2014 to 2015 and will be re-assessing its asset portfolio.

The company’s expenditure budget in 2014 was $161m and for 2015 this has been reduced to $90m, according to a trading statement.

Oil firms are trying to cut costs across the globe now that oil prices have sunk to under $50 a barrel.

Soco said: “In light of the current oil price environment, Soco's board is in the process of reviewing the company's overall portfolio of assets and carrying values.”

Soco added that its presence in Vietnam gives it an advantage over its competition.

“Against the backdrop of the challenging oil price environment, Soco is in a strong position given its robust balance sheet, low operating costs and attractive Vietnam production economics with operating cash flow break-even oil price per barrel in the low $20s.

“The company has sufficient cash flow and cash balances to meet its ongoing development and exploration expenditure and has capacity beyond that to take advantage of opportunities that may arise in this market.”

The stock was down 6% at 263.1p by 13:02 on Thursday.