(RTTNews) - Tuesday, oil and gas company El Paso Corp. (EP: News ) reported a huge decline in profit for the third quarter quarter, impacted by the lower oil prices, which more than offset an increase in revenues from pipeline segment. Looking ahead, the company lifted its full year 2009 earnings outlook. Separately, El Paso announced a reduced quarterly dividend for its shareholders.

The Houston, Texas-based company's net income attributable to common shareholders plunged to $58 million or $0.08 per share from $436 million or $0.58 per share in the prior year period.

Excluding impact of E&P or exploration and production financial derivatives of $118 million or $0.11 per share, adjusted earnings for the period was $0.23 per share, down from $0.35 per share in year earlier period.

On average, ten analysts polled by Thomson Reuters expected the company to report earnings of $0.22 per share for the quarter. Analysts' estimates typically exclude special items.

Operating revenues for the period declined to $0.98 billion from $1.59 billion in the preceding year quarter. Four analysts expected revenues of $1.12 billion.

In the sequentially preceding second quarter, El Paso's profit declined 59% to 79 million or $0.11 per share from $191 million or $0.25 per share in the year-ago quarter and adjusted earnings for the second quarter was $0.25 per share, down from $0.39 per share in the year-ago second quarter. Quarterly operating revenues declined 15% year-over-year to $973 million from $1.15 billion in the prior-year quarter.
For the quarter under review, El Paso reported lower production volumes due to a sharp drop in drilling activity in response to lower natural gas and oil prices. Production volumes for the quarter averaged 732 million cubic feet equivalent per day, or MMcfe/d, including 71 MMcfe/d of unconsolidated affiliate volumes. The prior-year quarter's production volumes averaged 793 MMcfe/d, including 75 MMcfe/d of unconsolidated affiliate volumes.

The exploration and production segment revenues, the largest contributor of revenues for the year-ago quarter to El Paso, slipped to $343 million from $881 million last year. However, the company's pipeline revenues grew to $667 million from $628 million a year earlier.

The company's operating income for the quarter was $329 million, down from $839 million in the same period last year.

Including financial derivative settlements, the company's average realized prices for natural gas per thousand cubic feet or MCF was $7.37, down from $8.67 a year-ago and, average realized prices for oil, condensate, and NGL were lower at $82.25 compared with $88.13 a year earlier.

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