From Pittsburgh-based EQT Corp. on its Marcellus and Utica shale reserves today:
PITTSBURGH--(BUSINESS WIRE)--EQT Corporation (NYSE: EQT) today reported year-end 2013 total proved reserves of 8.3 Tcfe. This represents a 2.3 Tcfe net increase over the 6.0 Tcfe reported last year, with a reserve replacement ratio of 738%.
The Company's 2013 Marcellus proved reserves increased by 1.7 Tcfe primarily from wells drilled in 2013, acreage acquisitions, higher estimated ultimate recoveries (EUR) per well, and the inclusion of natural gas liquids (NGL). For 2013, the EUR of proved Marcellus wells averaged 7.2 Bcfe, with an average lateral length of 4,335 feet (1,668 Mcfe per foot), compared to the 2012 EUR of 6.4 Bcfe, with an average lateral length of 4,512 feet (1,421 Mcfe per foot). Average EUR per foot increased by 17%; primarily due to the additional use of reduced cluster spacing (RCS). Approximately 41% of proved developed Marcellus wells and a majority of the proved undeveloped Marcellus wells utilize RCS.
Other proved reserves increases include 215 Bcfe for Upper Devonian, 351 Bcfe for Huron, and 100 Bcfe for coal bed methane (CBM) and Utica.
For 2013, drilling capital totaled $1.3 billion and reserve extensions, discoveries, and other additions totaled 2.0 Tcfe, resulting in a drill bit finding cost of $0.62 per Mcfe. In 2013, total drilling and acquisition capital was $1.4 billion and, excluding production, the total proved reserve increase was 2.7 Tcfe - which resulted in a finding and development cost from all sources of $0.52 per Mcfe. The Company's proved developed additions totaled 475 Bcfe on $475 million of capital for a development cost of $1.00 per Mcfe. Proved developed positive revisions totaled 540 Bcfe, primarily due to an increase in economic well life, as a result of higher natural gas prices and the inclusion of NGL reserves.
EQT estimates year-end 2013 total proved, probable and possible (3P) reserves at 36.4 Tcfe, an increase of 10.5 Tcfe, or 40%, over the 2012 estimate. The increase is primarily due to additional economic reserves in the Huron, the acquisition of additional Marcellus acreage and initial development in the Upper Devonian.
EQT now forecasts a 2014 depletion rate of $1.25 per Mcfe, compared to $1.50 per Mcfe in 2013.
Ryder Scott Company, L.P., the Company’s petroleum consultant, audited 100% of the Company’s proved reserves; 3P reserves are determined in accordance with the Securities and Exchange Commission (SEC) regulations. The Company also made an assessment of its total resource potential, which includes 3P reserve totals.
3P Reserves by Play (year-end 2013):
Reserve Estimates (Bcfe)
CBM / Utica
Total 3P Reserves
*Includes the Lower Huron, Cleveland, Berea sandstone, and other Devonian aged formations.
Annual Comparison of Estimated 3P Reserves by Play:
|Total 3P Reserves||18,471||15,012|
|Total 3P Reserves||11,481||7,364|
|Total 3P Reserves||4,817||2,360|
|CBM / Utica / Other|
|Total 3P Reserves||1,584||1,155|
|Total Probable and Possible||28,005||19,887|
Total 3P Reserves
Total Estimated Resource Potential by Play:
|CBM / Utica / Other||
Summary of Changes in Proved Reserves:
Balance at December 31, 2012 (Bcfe)
|Extensions, discoveries and other additions||2,047|
|Balance at December 31, 2013||8,348|
* A substantial portion of the revision is due to the first time inclusion of NGL reserves for 2013.
Year-end 2013 reserves are based on a $3.65 per Mcfe price, which is $0.86 higher than the price used to estimate the 2012 reserves. Both prices were determined in accordance with the SEC requirement to use the un-weighted arithmetic average of the first-day-of-the-month price for the preceding twelve months without giving effect to derivative transactions.
Reserve Replacement Ratio -- Reserve replacement ratio is the sum of the net increase of proved reserves before production, divided by production.
Drill Bit Finding Cost -- Drill bit finding cost is the total cost incurred related to natural gas and oil activities, calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification 932 (ASC 932), less property acquisition costs for proved developed and unproved properties, divided by extensions, discoveries and other additions.
Finding and Development Cost -- Finding and development cost from all sources is the total cost incurred related to natural gas and oil activities, calculated in accordance with ASC 932, divided by the sum of extensions, discoveries and other additions; purchase of natural gas and oil in place; and revisions of previous estimates.
About EQT Corporation:
EQT Corporation is an integrated energy company with emphasis on Appalachian area natural gas production, gathering, and transmission. EQT is the general partner and significant equity owner of EQT Midstream Partners, LP. With more than 125 years of experience, EQT continues to be a leader in the use of advanced horizontal drilling technology – designed to minimize the potential impact of drilling-related activities and reduce the overall environmental footprint. Through safe and responsible operations, the Company is committed to meeting the country’s growing demand for clean-burning energy, while continuing to provide a rewarding workplace and enrich the communities where its employees live and work. Company shares are traded on the New York Stock Exchange as EQT.
Visit EQT Corporation at www.EQT.com.
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