Range Resources at Capital One Conference

This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings.

“If you look at the Marcellus, today I think there’s well over 7,000 wells that have either been drilled, completed, or in some phase of waiting to come online. It’s an unbelievable story – in 2004, with the discovery well; in 2007, Range had a little bit less than a million today. Today, I think the field is by last account a little over 13 Bcf a day, largest gas-producing field in North America and a lot of people, including me, think it could be one of the largest fields in the world in not too many years in the future.”

“If you look at them on an absolute basis, we have five of the top 10 wells in the basin, including the Utica and Point Pleasant operations to the west of us. If you look at it on a normalized per-thousand foot or lateral length basis, in other words kind of normalized into the same lateral length, we have eight of the top 10 wells, so we’ve had some really, really great success in our super-rich area.”

“Going forward, we’re looking at about 4,500-foot laterals with 22 stages on average. It’s important to say we will drill some pretty long laterals over the next year or so, but our average we expect to be in that 4,500-foot range with 22 stages, half a million pounds of frac sand per stage. ”

“When you look at that, the economics are very impressive – close to 100%, and net present value at $15 million a well, so this is really attractive stuff, lots of liquids, lots of condensate. Our costs today are about $6.4 million.”

“The wet area of the Marcellus is about 220,000 acres in that southwest PA area. ..these wells on an EUR per thousand foot basis are some of the best wells in the basin when you look at that way. About 12.3 Bcf equivalent going forward. We expect them to be average of, again, around 4,200 feet lateral length with 21 stages and about 400,000 pounds of frac sand per stage. About $6.1 million – again, over 100% rate of return, and about $15 million present value, so these are again really attractive wells, lots of liquids.”

“if we exit this year at Bcf equivalent per day, we’re going to be at 2; three or four years out, we’re going to be at 4. That’s an aggressive schedule. We’ve very confident in it.”

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