Wednesday, July 20, 2011
Fort Worth Star-Telegram, Texas
by Jack Z. Smith
Despite selling virtually all its Barnett Shale properties in North Texas in April, Range Resources expects to "have fully replaced all of the Barnett production" by the end of the third quarter, CEO John Pinkerton said in an update released in advance of the company's second-quarter earnings report.
Pinkerton said the Fort Worth-based natural gas and oil producer can boost production because of "excellent drilling results in the Marcellus Shale and Mid-Continent regions."
The company has been among the leading producers in the Marcellus natural gas field in Pennsylvania and has benefited from robust oil and gas production in the Mid-Continent region, which includes Texas and Oklahoma.
Range lost production equivalent to more than 100 million cubic feet of natural gas per day by selling its Barnett Shale properties effective April 29. But Range said its second-quarter production volume still averaged the equivalent of 508 million cubic feet of natural gas per day, an 8 percent increase over the second quarter of 2010.
Production for the second quarter of this year was 76 percent natural gas, 17 percent natural gas liquids and 7 percent crude oil, Range said in the operations update issued late Monday. The company is scheduled to report second-quarter results Monday.
Range said it received an average price equivalent to $5.63 per 1,000 cubic feet of natural gas for its second-quarter production, an 11 percent increase over a year earlier. Average prices were $4.63 per 1,000 cubic feet for natural gas, $50.07 per barrel for natural gas liquids and $80.42 per barrel for oil.
Pinkerton said Range is on track to achieve its goal of achieving net production equivalent to 400 million cubic feet of natural gas per day in the Marcellus Shale by year's end.
Based on the performance of 103 Marcellus Shale horizontal wells that began producing in 2009 and 2010, Range is projecting that the estimated ultimate recovery, or lifetime production, from these wells will average the equivalent of 5.7 billion cubic feet of natural gas per well, including about 4 billion cubic feet of gas and 281,000 barrels of liquids (natural gas liquids and crude oil).
The estimated recovery per Marcellus horizontal well is two to three times the estimated lifetime production of many typical wells in the Barnett Shale.
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