RRC increases reserve potential

[dan_s]

RRC is going to be focused on the liquids rich areas of the Marcellus Shale this year. They now have the potential for HUGE additions to their proven reserves year-after-year. Note that RRC also has a large stake in the Mississippian oil play that will draw a lot of attention this year. - Dan

FORT WORTH, TEXAS, FEBRUARY 6, 2012

RANGE RESOURCES CORPORATION (NYSE: RRC - News) announced today that its unrisked unproved resource potential ("resource potential") as of December 31, 2011 increased to 44 - 60 Tcfe, up from 35 - 52 Tcfe at year-end 2010. The year-end 2011 results include 35 - 49 Tcf of natural gas and 1.5 - 2.0 billion barrels of NGLs and crude oil. Of the total year-end 2011 unproved resource potential, 54% is attributable to the Marcellus Shale with the remaining 46% attributable to other formations in Appalachia, the Midcontinent and West Texas. Range previously announced that its year-end 2011 proved reserves were 5.1 Tcfe. Based on the mid-point of the unproved resource potential, Range has the opportunity to grow its proved reserves over 10 times.

No unproved resource potential estimates were assigned to the Company`s Utica acreage. In addition, the estimated unproved resource potential assumes no ethane extraction. If the ethane volumes were included, the Company estimates that its total unproved resource potential would increase to 47 to 66 Tcfe, including 2.3 - 3.1 billion barrels of NGLs and crude oil.

Commenting, Jeff L. Ventura, Range`s President and CEO, said, "The increase in our unproved resource potential is a reflection of our outstanding 2011 drilling results and the technical progress made across many of our key projects. Of particular note, is the increase in the NGLs and crude oil portion of our unproved resource potential which is driven primarily by the progress made in the liquids-rich portion of the Marcellus Shale and in the horizontal Mississippian oil play where our acreage position now totals 125,000 net acres. We have assembled an exceptional portfolio of high return, low-cost projects. Importantly, we have also assembled a high-quality technical team that has a solid track record of converting our resource potential into production and proved reserves at low cost."

RANGE RESOURCES CORPORATION (NYSE: RRC - News) is a leading independent oil and natural gas producer with operations focused in the Appalachia and the southwest portion of the United States. The Company pursues an organic growth strategy targeting high return, low-cost projects within its large inventory of low risk, development drilling opportunities. The Company is headquartered in Fort Worth, Texas. More information about Range can be found at www.rangeresources.com and www.myrangeresources.com.

[dan_s]

Range shifting even more of this year's capex to liquids.

From Citi Research Team:

Marcellus Focus Shifts To Liquids-Rich Regions – Of the 13 total rigs Range is currently running in the Marcellus shale, only 4 are operating in the “dry” gas regions. Management plans to scale back its dry gas activity further throughout the year by reallocating some of these rigs to the liquids-rich portions of the play, although drilling commitments to hold acreage will keep the dry gas rig count from dropping to zero. In order to reduce costs in the dry gas regions, Range plans to shift from drilling 6 wells per pad to 2 wells per pad and to conduct more “cluster” fracture stimulations. However, we suspect that breakeven costs, including transportation, in the dry gas portions of the play may still not be below $3.00/MMBtu. But we expect management will provide more details on its Marcellus operations, including breakeven costs for the dry gas portion of the play, on its Q4’11 earnings call.