Range Resources (RRC) is #1 Gasser in U.S.
Posted: Fri Jan 27, 2017 9:53 am
Big increases in P1 reserves ("Proven") will lower DD&A expense going forward for all of the Sweet 16. - Dan
FORT WORTH, Texas, Jan. 27, 2017 (GLOBE NEWSWIRE) -- RANGE RESOURCES CORPORATION (RRC) announced today that proved reserves as of December 31, 2016 were 12.1 Tcfe.
Reserves
Highlights –
Proved reserves increased 11%, excluding acquisitions and divestitures
Proved developed reserves increased 14%, excluding acquisitions and divestitures
Drill-bit development cost with revisions is expected to be $0.34 per mcfe
Future development costs for proved undeveloped reserves are estimated to be $0.42 per mcfe; Marcellus costs are estimated to be $0.37 per mcfe
Unhedged recycle ratio improves to over 3x based on future development costs of $0.42 per mcfe
Commenting on Range’s 2016 proved reserves, Jeff Ventura, Range’s CEO, said, “Range had another solid year of reserve growth, replacing 292% of production from drilling activities with drill-bit development costs of $0.34 per mcfe when considering pricing and performance revisions. Positive performance revisions continued in 2016 as we extended laterals, improved targeting and drove efficiencies throughout our developed leasehold and infrastructure. The strong reserve additions from drilling activity were driven primarily by our development in the Marcellus, as our acquisition of North Louisiana assets closed in late 2016. Future development costs for proven undeveloped locations are estimated to be $0.42 per mcfe, which is outstanding and should improve our top tier unhedged recycle ratio to over 3x. Importantly, Range added 1.65 Tcfe of reserves, excluding acquisitions, reflecting our large inventory of low-risk, high- return projects in the Marcellus shale and in North Louisiana.”
“In North Louisiana, performance in 2016 was in line with our acquisition economics and the properties recorded a slight performance increase, while drilling added 79 Bcfe of reserves post-acquisition. Looking forward, we see capital efficiencies continuing as we drive down well costs while optimizing targeting. Our reserve booking philosophy on the newly acquired assets is consistent with our approach in the Marcellus. As a result, a relatively small portion of the Company’s future development capital, only $2.2 billion over the next five years, is allocated to proven locations, while the remainder of capital delineates our extensive acreage position, still classified as unproven. In fact, less than 0.5 offset proven undeveloped locations are currently recorded in the Marcellus and North Louisiana for each horizontal producing well. We believe this will generate consistent SEC reserve growth over time as additional acreage is classified as proven and capital is allocated to offset locations. As an example, Range has approximately 740 Bcfe of additional reserves in the Terryville area that would be included as SEC proved reserves if included within the five-year development plan. Our economic resilience is further demonstrated in the year-end SEC PV10 reserve value of $9.0 billion using future strip prices and current sales contracts. With 56% of SEC reserves being proved developed (PD), our PD reserve life and debt per PD reserve ratios remain exceptionally strong.”
Range’s estimate of costs incurred during 2016, excluding acquisition costs is approximately $570 million. This is on target with Range’s previously announced capital budget of $495 million, prior to the Memorial acquisition.
FORT WORTH, Texas, Jan. 27, 2017 (GLOBE NEWSWIRE) -- RANGE RESOURCES CORPORATION (RRC) announced today that proved reserves as of December 31, 2016 were 12.1 Tcfe.
Reserves
Highlights –
Proved reserves increased 11%, excluding acquisitions and divestitures
Proved developed reserves increased 14%, excluding acquisitions and divestitures
Drill-bit development cost with revisions is expected to be $0.34 per mcfe
Future development costs for proved undeveloped reserves are estimated to be $0.42 per mcfe; Marcellus costs are estimated to be $0.37 per mcfe
Unhedged recycle ratio improves to over 3x based on future development costs of $0.42 per mcfe
Commenting on Range’s 2016 proved reserves, Jeff Ventura, Range’s CEO, said, “Range had another solid year of reserve growth, replacing 292% of production from drilling activities with drill-bit development costs of $0.34 per mcfe when considering pricing and performance revisions. Positive performance revisions continued in 2016 as we extended laterals, improved targeting and drove efficiencies throughout our developed leasehold and infrastructure. The strong reserve additions from drilling activity were driven primarily by our development in the Marcellus, as our acquisition of North Louisiana assets closed in late 2016. Future development costs for proven undeveloped locations are estimated to be $0.42 per mcfe, which is outstanding and should improve our top tier unhedged recycle ratio to over 3x. Importantly, Range added 1.65 Tcfe of reserves, excluding acquisitions, reflecting our large inventory of low-risk, high- return projects in the Marcellus shale and in North Louisiana.”
“In North Louisiana, performance in 2016 was in line with our acquisition economics and the properties recorded a slight performance increase, while drilling added 79 Bcfe of reserves post-acquisition. Looking forward, we see capital efficiencies continuing as we drive down well costs while optimizing targeting. Our reserve booking philosophy on the newly acquired assets is consistent with our approach in the Marcellus. As a result, a relatively small portion of the Company’s future development capital, only $2.2 billion over the next five years, is allocated to proven locations, while the remainder of capital delineates our extensive acreage position, still classified as unproven. In fact, less than 0.5 offset proven undeveloped locations are currently recorded in the Marcellus and North Louisiana for each horizontal producing well. We believe this will generate consistent SEC reserve growth over time as additional acreage is classified as proven and capital is allocated to offset locations. As an example, Range has approximately 740 Bcfe of additional reserves in the Terryville area that would be included as SEC proved reserves if included within the five-year development plan. Our economic resilience is further demonstrated in the year-end SEC PV10 reserve value of $9.0 billion using future strip prices and current sales contracts. With 56% of SEC reserves being proved developed (PD), our PD reserve life and debt per PD reserve ratios remain exceptionally strong.”
Range’s estimate of costs incurred during 2016, excluding acquisition costs is approximately $570 million. This is on target with Range’s previously announced capital budget of $495 million, prior to the Memorial acquisition.