* Q1 EPS C$0.12 vs C$0.63 year ago
* Funds flow falls 5 percent
* Gross revenue up 3 pct
* Reaffirms production, capital budget outlook for the year (Adds details, shares)
May 4 (Reuters) - Penn West Petroleum Ltd reported an 80 percent fall in first-quarter profit on cheaper Canadian crude and decade-low natural gas prices.
Penn West, one of Western Canada's largest conventional oil and gas producers, has been spending more on light-oil areas such as the Carbonates, Cardium, Viking and Spearfish to ward off weak natural gas prices.
The price of the fuel fell 40 percent in the January-March quarter.
Net income for the company fell to C$59 million ($59.8 million), or 12 Canadian cents per share, from C$291 million, or 63 Canadian cents per share, a year ago.
Production averaged at 167,420 barrels of oil equivalent per day (boe/d), nearly flat from the year-ago period.
Average liquids production in the quarter was more than 107,000 boe/d, of which about 90 percent was oil, the company said in a statement.
Funds flow fell 5 percent to C$337 million, or 71 Canadian cents per share.
Gross revenue, however, rose 3 percent to C$870 million.
The company reaffirmed its production and capital budget forecast for the year.
It still expects production to average 168,500 boe/d to 172,500 boe/d, and capital budget of C$1.3 billion to C$1.4 billion, net of asset acquisition and disposition.
Shares of the Calgary, Alberta-based company, which has a market value of C$7.89 billion, closed at C$16.18 on Thursday on the Toronto Stock Exchange. ($1 = 0.9867 Canadian dollars) (Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Maju Samuel)
