California Resources Corporation (NYSE: CRC) announced it is reducing its capital investment due to recent changes in the commodity market to a level that maintains the mechanical integrity of its facilities to operate them in a safe and environmentally responsible manner. CRC has effectively ceased investment in its internally funded field development and growth projects until the company sees a higher degree of market clarity. The company was already on pace to invest less than $35 million of internally funded capital in the first quarter. Additionally, CRC has monetized all of its crude oil hedge positions following the first quarter to enhance the company's flexibility in this volatile time period. These sales along with expected March hedge settlements are raising approximately $76 million and monetizing the maximum spread in our put-spread hedge positions.
Todd Stevens, President and CEO of CRC, noted, "In response to the effects on global demand from the Coronavirus and proposed global supply increases, we are immediately reducing our capital investment to a level that maintains our operations in a safe and responsible manner. We have experienced this type of price drop previously and will implement our low-price playbook, just as we did in 2016. CRC plans to exercise strong financial discipline to aid liquidity. We plan to continue building our economically viable drilling inventory and designing the Elk Hills carbon capture and sequestration project and other ongoing sustainability projects. We believe these events are transitory in nature and have high confidence in the revenue generating potential of our low-decline assets."