text: Amoco Corp first quarter profits are expected to exceed the 165 mln dlrs or 65 cts per share reported for 1986s fourth quarter chairman Richard Morrow said. Speaking to reporters after a security analyst meeting he said the gain was expected because of higher oil and gas prices but declined to compare his expectations with the 331 mln dlrs or 1.28 dlrs per share the company earned in 1986s first quarter. Earlier Morrow told the analysts that Amocos first quarter refining and marketing results will look pretty poor because of low margins in January and February. The margins began to improve last month and look pretty good now he added. Morrow said he expects oil product margins to remain good for the rest of the year but it remains to be seen if they will match 1986 levels. The Amoco chairman said he expects crude oil prices to remain in the 17 to 20 dlr barrel range for the rest of 1988 based on his belief that OPECs agreement will hold. Morrow said his best estimate for 1989 crude oil prices is 21 dlrs per barrel adding he believes this price level would result in a 40 pct increase in oil company exploration spending. President H. Lawrance Fuller told the analysts Amoco reduced its estimates of worldwide oil and gas reserves by a total of 201 mln equivalent barrels last year because of a drop in oil and gas prices. Noting the Securities and Exchange Commission requires that reserves be estimated on the assumption that year-end prices will remain fixed for the life of the properties he said the drop in oil prices to 16 dlrs a barrel at the end of 1986 from 27 dlrs a year earlier forced the company to reduce its reserve estimate by four pct. Fuller said Amoco expects its U.S. oil and natural gas liquids production to decline about five pct this year from last years 121 mln barrels because of drilling deferrals made last year when oil prices were falling. He said the full impact of the deferrals was off-set by the purchase of properties which will add about 5000 barrels per day to the companys 1987 U.S. production. Fuller said U.S. refining capacity is expected to be increasingly strained by the rising demand for lead-free gasoline especially the higher octane grades. He said expected federal regulations on gasoline vapor pressure will further tighten the industrys gasoline production capacity. Reuter
target: AMOCO <AN> SEES 1ST QTR NET TOPPING 4TH QTR