Feb. 23 (UPI) -- U.S. shale oil and gas player Cabot said Friday it recognized a quarter-billion-dollar benefit from changes made to the federal tax code.
Cabot Oil & Gas Corp. reported full-year net income of $100 million, compared with a net loss of $417 million in 2016. The company took a loss of $44 million in the fourth quarter, compared with $292 million year-over-year.
"As a result of the enactment of the Tax Act, Cabot recorded an income tax benefit of $242.9 million in the fourth-quarter of 2017 resulting from the remeasurement of the company's net deferred tax liabilities based on the new lower corporate income tax rate," the company stated.
Australian energy and mining company BHP Billiton, which is planning to sell off its U.S. shale assets, is anticipating a $1.8 billion charge on U.S. tax code changes, but expects long-term benefits.
Despite pledging $50 billion in investments in U.S. shale oil over the next five years, U.S. supermajor Exxon Mobil disappointed the market when it released its fourth quarter report as a multi-billion dollar benefit from a U.S. tax overhaul masked some underlying weakness.
Fourth quarter earnings from exploration and production for Exxon were $9 billion higher than the same period in 2016, but $7.1 billion of that was driven by the U.S. tax reform.
President Donald Trump signed the Tax Cuts and Jobs Act before leaving for the Christmas holiday. The measure offers temporary breaks for taxpayers and permanently cuts taxes for corporations from 35 percent to 21 percent. It passed out of the House and Senate along party lines.
Trump has put the oil and gas sector at the forefront of his energy agenda just as the United States is setting records in terms of production.
Cabot said much of its production growth for the year would come during latter half.
"We anticipate sequential quarterly growth of approximately six, eleven and thirteen percent in the second, third, and fourth quarters, respectively, resulting in a divestiture-adjusted exit-to-exit production growth rate of over 35 percent," Chairman, President and CEO Dan O. Dinges said in a statement.