Pioneer Natural Resources ( PXD) approved a 2006 capital budget of $1.3 billion, an increase of about $200 million from comparable 2005 capital spending, excluding acquisitions.

The budget reflects strategic initiatives announced during 2005 to increase its focus on North American onshore development activities and lower-risk resource plays, the company said.

The capital budget is allocated 70% for development activities, 20% to test attractive resource plays onshore North America and Tunisia and 10% for high-impact exploration in the U.S. and West Africa.

The 2006 high-impact exploration budget includes plans to drill three wells in Alaska, two in West Africa, one or two in Mississippi and two to test amplitudes related to the Clipper discovery.

The Irving, Texas-based company, said it intends to fund its 2006 capital program with cash flow from operations and a portion of the proceeds from the divestiture of assets in the deepwater Gulf of Mexico and Argentina.

The company expects 2006 average daily production of 95,000 barrels oil equivalent per day to 100,000 barrels oil equivalent per day (BOEPD), a 10% increase from the year 2005. First quarter 2006 production from continuing operations is expected to average 90,000 BOEPD to 95,000 BOEPD. Full year production for 2006 is expected to range from 33 million barrels oil equivalent to 37 million barrels oil equivalent.

About 45% of the annual budget for high-impact exploration is being invested during the first quarter, the company said.
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