Noble Energy (NYSE:NBL) plans to invest $3.5 billion across the company's global oil and gas portfolio in 2012. The company expects this level of spending to generate double digit production growth over 2011 volumes. (To know more about oil and gas, read Oil And Gas Industry Primer.)

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2012 Capital Spending
Noble Energy has allocated its 2012 capital budget over its various core oil and gas development areas, as well as for exploration to set up for future growth. The onshore United States will receive the majority of the capital, with 51% of the $3.5 billion allocated here in 2012.

The Eastern Mediterranean, West Africa and the Gulf of Mexico regions are set to receive 22, 14 and 7% of the 2012 budget, respectively.

Production Growth
The company expects sales volumes in 2012 to range from 244,000 to 256,000 barrels of oil equivalent (BOE) per day. The midpoint of this range would represent growth of 13% over 2011.

It has been investing heavily over the last few years in liquids areas, and estimates that the production of crude oil and condensate will grow by 40% over 2011. The company is looking for crude oil and condensate to comprise 46% of total volumes in 2012, up from 39% last year.

Onshore United States
Noble Energy plans to increase development in the Denver Julesburg basin in 2012, and will spend $1.25 billion here during the year. These funds will be invested mainly in the horizontal development of the Niobrara formation, where the company plans to drill 173 wells in 2012. The company will also continue to drill in the Wattenberg Field, where it has a vertical development program.

The company is involved with CONSOL Energy (NYSE:CNX) in a joint venture to develop the Marcellus Shale. It has committed to spend $500 million here on 99 gross wells in 2012.

Eastern Mediterranean
Noble Energy has been successful in the exploration and development of natural gas in the Eastern Mediterranean over the last few years, and plans to continue to invest here in 2012. The company has budgeted $750 million for this region and will focus on the development of the Tamar and Noa fields located offshore Israel. The Tamar Field is expected to start up production in 2013, and replace declining production from the Mari-B field.

Exploration and Appraisal Activity
Noble Energy has set aside 16% for exploration and appraisal activity in 2012. The company has a number of exploration prospects in offshore Cameroon, the Gulf of Mexico and offshore Israel.

It plans to continue to advance on the Gunflint discovery, located in the deepwater Gulf of Mexico. The company estimates that the potential resources here range from 70 million to 500 million BOE. It plans multiple appraisal wells here in 2012 to narrow this estimated resource range.

BP (NYSE:BP) and Marathon Oil (NYSE:MRO) also have an ownership interest in the Gunflint discovery.

One exploration prospect that will be watched closely by investors in 2012 is at the Leviathan discovery located offshore Israel. Noble Energy has reported several successful wells here targeting natural gas, and is planning to test an oil play located at a deeper depth at Leviathan.

The Bottom Line
Investors that buy Noble Energy get a diverse set of oil and gas assets spread across the globe. These assets include a leading position in an emerging liquids play in the onshore United States and the potential of a huge upside from the company's exploration in the Eastern Mediterranean and other areas. (For additional reading, check out A Guide To Investing In Oil Markets.)

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At the time of writing, Eric Fox did not own shares in any of the companies mentioned in this article.

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