All CATEGORIES
☰ Menu
Ohio Utica Shale

Eclipse Resources has 110 producing wells in Utica, Marcellus

By Bob Downing Published: August 14, 2014

From Eclipse Resources today:

STATE COLLEGE, Pa.--(BUSINESS WIRE)--Eclipse Resources Corporation (“Eclipse Resources”) (NYSE: ECR) today announced financial and operational results for the quarter ended June 30, 2014. Highlights for the period include:

Record Production and Operating Results:

  • Net production averaged approximately 42 MMcfe per day in the second quarter of 2014, a 9% increase from the first quarter of 2014
  • Net production averaged approximately 58 MMcfe per day during the month of June 2014, a 52% increase from the first quarter of 2014
  • Commenced drilling 24 gross (16 net) operated Utica Shale wells averaging just 23 days from spud to rig release for wells drilled to depth during the quarter
  • Placed the Company’s operated Herrick well pad into sales consisting of 3 gross (2.5 net) Utica Shale dry gas wells with an average lateral length of 6,132 feet at an average 30-day sales rate of approximately 35 MMcf per day using the Company’s restricted choke production method with average initial flowing pressure of 5,838 psi over the first 5 days
  • Participated in 16 gross (2.5 net) non-operated Utica Shale wells drilled, 8 gross (0.8 net) wells completed, and 12 gross (2.6 net) placed into sales
  • Mid-year 2014 proved reserves increased by 70% from March 31, 2014 to approximately 186 Bcfe (24% liquids) with a pre-tax PV-10(1) of $337.9 million
  • Increased core Utica Shale leasehold to approximately 99,300 net acres, of which 26,400 net acres are also prospective for the Marcellus Shale during the quarter ended June 30, 2014 from approximately 96,200 net acres in the Utica Shale and approximately 25,700 net acres in the Marcellus Shale at March 31, 2014

Strong Financial Results:

  • Successfully completed initial public offering of 30.3 million shares of the Company’s common stock resulting in net proceeds to Eclipse Resources of $545.4 million (after deducting secondary proceeds, underwriting discounts and commissions and offering expenses)
  • Revenues grew to $27.0 million during the second quarter of 2014, a 9% increase over revenues during the first quarter of 2014, with adjusted EBITDAX(1) of $11.3 million

New Firm Transportation and Sales Agreements:

  • Contracted for firm gas transportation for up to 150,000 Dth per day on Energy Transfer’s “Rover” project, providing the Company the flexibility to move Utica and Marcellus natural gas north to Dawn, Ontario and south to the Gulf Coast
  • Contracted for 50,000 Dth per day of firm sales during the summer of 2015 and 20,000 Dth per day of firm sales during the winter of 2015/2016 at fixed basis differentials to Henry Hub
  • Contracted for firm gas transportation for 205,000 Dth per day on Columbia Gas Transmission’s Utica Access project, giving the Company the ability to move Utica and Marcellus natural gas to the Columbia Transmission (TCO) Pool
  • Contracted for firm gas transportation for up to 100,000 Dth per day on the TETCO “Team 2014” project, providing the Company the flexibility to move Utica and Marcellus natural gas to the northeastern M3 market, the Gulf Coast and Midwestern markets

Commenting on the announcement, Benjamin Hulburt, Eclipse’s Chairman, President and CEO, said “Based on our results this quarter and year to date, I continue to believe we are on pace for record setting growth through the end of this year and next. Our drilling, completion, operations and land teams are executing on our detailed three-year drilling plan and continue to meet or exceed expectations. Our quarterly production exceeded our internal estimates, our drilling pace is running ahead of schedule and our proved reserves have continued to grow at a rapid pace.”

Operational Update

Eclipse Resources’ production volumes for the three months ended June 30, 2014 were 3.8 Bcfe, or 41.9 MMcfe per day, which represents a sixty-fold increase over the prior year’s comparable quarter and 9% over the first quarter of 2014. Production for the quarter was comprised of 64% natural gas, 18% NGL, and 18% oil.

During second quarter of 2014, Eclipse Resources commenced drilling 24 gross (16 net) operated Utica Shale wells, completed 6 gross (4 net) Utica Shale wells and placed 3 gross (2.5 net) Utica Shale wells into sales. The Company began to place its operated Herrick Unit into sales in eastern Monroe County, Ohio on June 12, 2014. The Herrick Unit consisted of 3 gross (2.5 net) dry gas Utica Shale wells that were drilled and completed with an average lateral length of 6,132 feet. All three wells were completed with fracture stage lengths of 250 feet. The Company tested different concentrations of slick water, crosslink gel and sand in each of the wells as part of its frac design testing program. Although all three of the wells have shown strong initial production rates and flowing pressures, one of the wells is outperforming the others, providing the Company with valuable insight toward its goal of developing an optimized frac design as expeditiously as possible. The Herrick pad produced at an average 30-day sales rate of 34.9 MMcf/d using the Company’s restricted choke production method with average initial flowing pressure of 5,838 psi over the first five days. The first month’s production from the Herrick Unit was negatively impacted during portions of the month by simultaneous downtime on the Eureka and Dominion pipeline systems due to tap related equipment installations associated with the increased volumes.

Eclipse Resources has completed its Shroyer Unit, consisting of 2 gross (1.9 net) Utica Shale wells, in eastern Monroe County, Ohio with average lateral lengths of 7,819 feet. These wells are located in the Company’s Dry Gas type curve area. The first well on the Shroyer Unit pad was connected to sales, ahead of schedule on August 11, 2014, with initial flowing pressures in excess of 7,500 psi and is continuing to clean-up. The Company expects to begin flowing the second well to sales during the coming week.

Additionally, the Company has completed its Mizer Unit consisting of 5 gross (3.2 net) Utica wells in Harrison County, Ohio with average lateral lengths of 5,767 feet. The Mizer Unit is located on the boundary between the Company’s Condensate and Rich Gas bands of the Utica Shale play. Eclipse Resources expects to begin producing the Mizer Unit to sales during the month of August, also ahead of schedule, pending completion of the condensate central gathering facility the Company is currently building.

The Company is currently running 5 operated rigs in the Utica Shale play, including 1 top hole rig, and has continued to make improvements in its drilling efficiencies, averaging just 23 days per well for wells drilled to depth during the quarter ended June 30, 2014. Additionally, as previously disclosed during the second quarter, the Company has contracted two additional horizontal rigs to be delivered in the fourth quarter of 2014. The Company currently has one dedicated frac crew and is negotiating for a second. Based on the current drilling pace, the Company continues to believe it is running at or ahead of schedule on its drilling plan for the year.

Eclipse Resources frequently participates in Utica and Marcellus Shale wells on a non-operated basis. During the quarter ended June 30, 2014, Eclipse Resources participated in the drilling of 16 gross (2.5 net) wells, completion of 8 gross (0.8 net) wells, and placed 12 gross (2.6 net) wells into sales.

As of July 31, 2014, the Company’s inventory of producing wells and wells-in-progress in the Utica and Marcellus Shale consisted of 110 gross (46.6 net) wells. The 7 gross operated wells awaiting midstream set forth in the table below include the 2 Shroyer Unit wells, which are now producing, and 5 Mizer Unit wells, which Eclipse Resources expects to begin producing to sales in August. A full summary of wells in progress and producing is as follows:

             
      Operated     Non-Operated
     

Average Working

         

Average Working

     

Status

   

Interest %

   

Well Count

   

Interest %

   

Well Count

Top Hole     76.7%     12 gross (9.2 net)            
Drilling     78.1%     4 gross (3.1 net)     28.4%     9 gross (2.6 net)
Awaiting Completion     71.5%     14 gross (10.0 net)     14.3%     1 gross (0.1 net)
Completing     50.9%     6 gross (3.1 net)     3.6%     6 gross (0.2 net)
Awaiting Midstream     72.7%     7 gross (5.1 net)     11.8%     6 gross (0.7 net)
Producing     90.2%     5 gross (4.5 net)     20.1%     40 gross (8.1 net)

Total

   

72.9%

   

48 gross (35.0 net)

   

18.7%

   

62 gross (11.6 net)

                         

Commenting on the Company’s quarterly operations and production, Eclipse Resources’ Executive Vice President and Chief Operating Officer, Thomas Liberatore, said “We, as a Company, are focused on executing our three-year drilling plan that we outlined during our initial public offering, and I’m pleased to say that is what we are doing. Our drilling teams have considerably improved their drilling efficiencies. We now average just 23 days from spud to rig release and our completion teams have averaged approximately 4 stages per day. We are continuing our methodical program to optimize our completion techniques, which is already providing us with valuable insights.”

Print
Add This

SUBSCRIBE VIA RSS

OHIO.COM VIDEOS

See the most recent drilling report and an injection wells map From NewsOutlet.org

Utica and Marcellus shale web sites

Ohio Department of Natural Resources' Division of Oil and Gas Resources Management State agency Web site.

ODNR Division of Oil and Gas Resources Management. State drilling permits. List is updated weekly.

ODNR Division of Geological Survey.

Ohio Environmental Protection Agency.

Ohio State University Extension.

Ohio Farm Bureau.

Ohio Oil and Gas Association, a Granville-based group that represents 1,500 Ohio energy-related companies.

Ohio Oil & Gas Energy Education Program.

Energy In Depth, a trade group.

Marcellus and Utica Shale Resource Center by Ohio law firm Bricker & Eckler.

Utica Shale, a compilation of Utica shale activities.

Landman Report Card, a site that looks at companies involved in gas and oil leases.FracFocus, a compilation of chemicals used in fracking individual wells as reported voluntarily by some drillers.

Chesapeake Energy Corp,the Oklahoma-based firm is the No. 1 driller in Ohio.

Rig Count Interactive Map by Baker Hughes, an energy services company.

Shale Sheet Fracking, a Youngstown Vindicator blog.

National Geographic's The Great Shale Rush.

The Ohio Environmental Council, a statewide eco-group based in Columbus.

Buckeye Forest Council.

Earthjustice, a national eco-group.

Stop Fracking Ohio.

People's Oil and Gas Collaborative-Ohio, a grass-roots group in Northeast Ohio.

Concerned Citizens of Medina County, a grass-roots group.

No Frack Ohio, a Columbus-based grass-roots group.

Fracking: Gas Drilling's Environmental Threat by ProPublica, an online journalism site.

Penn State Marcellus Center.

Pipeline, blog from Pittsburgh Post-Gazette on Marcellus shale drilling.

Allegheny Front, environmental public radio for Western Pennsylvania.