Southwestern Energy (SWN) held a conference call on February 26, 2010, to discuss fourth quarter of 2009 earnings. The company provided extensive operational details on its properties in various shale plays including the Fayetteville Shale.
Southwestern Energy has driven down the cost of new wells in the Fayetteville Shale by cutting the time to drill, despite a double digit increase in lateral length for new wells.
Fayetteville Shale Well Costs And Efficiencies
“Our horizontal wells had an average completed well cost of $2.9 million per well compared to an average of $3 million per well in 2008, as the decrease in our drilling times and other savings more than offset a 13% increase in lateral length.”
Fayetteville Shale Rig Count
“We are currently running 22 drilling rigs in Fayetteville Shale play, 16 are capable of drilling horizontals and six smaller rigs are used to drill the vertical sections of the wells.”
“If we see a repeat of the low gas prices we saw in 2009, we will actively manage our capital program and make reductions in our 2010 plans. However, if gas prices rebound during the year, we could increase our planned investments and accelerate the development of the Fayetteville Shale by adding additional drilling rigs.”
Source: Seeking Alpha