Aurora Oil and Gas will commit up to $495 million in capital expenditure this year to drive an expected 47 per cent jump in production out of its US shale assets.
The top 100 Australia-listed company has forecast production of 10.6-11.7 million barrels of oil equivalent (boe) or 7.8-8.6 million boe net after royalties.
Perth-based Aurora's assets are located in the liquids rich Eagle Ford shale region in southern Texas where BHP Billiton also produces oil and gas.
Aurora, in a statement, said it expected earnings growth in the second half of 2014 would exceed its capex at the EBITDAX level (earnings before interest, tax, depreciation, depletion, amortisation and exploration).
That is based on an oil price of $US90 barrel and a natural gas price of $US3.50 per million British thermal units.
The forecast capex of $US455 million to $US495 million would be less than last year despite it expecting to drill 13 per cent more wells this year and funded from existing finance facilities, the company said.
More of its spending would go to joint ventures operated by partner Marathon Oil than its own separately-operated wells, it said, to shore up the balance sheet.
Aurora was now in a low-risk, high-margin and repetitive-development program, Aurora chief executive Douglas Brooks said.
"Well costs have been dramatically reduced while well performance has increased even with tighter well spacing," he said.
Shares in Aurora, which has a market capitalisation of $1.4 billion, were flat at $2.98 at 10.55am.