Range Resources (RRC)

[dan_s]

Earnings Forecast from Stifel
RRC will report 1Q15 earnings after the market close on 4/28/15 and host a call
4/29/15 at 9 am ET. We project 1Q15 EPS/CFPS of $0.15/$1.18, 18.4%/ 2.3%
above Street consensus of $0.13/$1.16. Our 1Q15 production forecast of 1.30
Bcfe/d is in-line with guidance, slightly below consensus of 1.31 Bcf/d, and implies
growth of 23% y/y and 1.8% from 4Q14.
Marcellus Type Well Update
We look for RRC to highlight significant Marcellus cost reductions. For example,
well costs per lateral foot in SWPA have declined 57% since 2011 with the largest
reduction occurring during 1Q15, aided primarily by a 23-25% decrease in service
costs between December 2014 and February 2015. Costs per lateral foot have
declined 63% in NEPA over the same time frame. As such, management is likely
to lower its SWPA and NEPA type well costs of $5.9mn and $4.9mn.
Utica Update < This is very important to Gastar Exploration (GST)
The company's first dry gas Utica well, the Claysville Sportsman's 11H, had a record
24-hr IP of 59 MMcf/d and is currently producing at 20 MMcf/d under constrained
conditions. RRC's second Utica well is slated to come online in mid-summer of this
year along with the addition of permanent infrastructure in the area. Management
is likely to outline how it plans to drive Utica well costs from approximately
$13.0mn to the $10.4mn to $11.0mn range. Timing of a third well in 2H15 should
be discussed. RRC continues to emphasize the quality of its Utica acreage, which
holds 20% to 30% more gas-in-place than its neighbors.

This will be the first of several first quarter reports that will have an impact on GST. The others are NFX, XEC, DVN and CLR. All of them are drilling big wells very close to GST's acreage block in Oklahoma.