Marcellus Shale

St. Mary Land & Exploration Company - Marcellus Shale Update

St. Mary Land & Exploration Company (SM) recently updated its operations in the Marcellus Shale. The company has 41,000 net acres under lease in the Marcellus Shale, with 17,000 acres in McKean County and 24,000 acres in Potter County.

St. Mary Land & Exploration Company has drilled and completed two horizontal wells in McKean County, Pennsylvania. The Potato Creek 1H and the Potato Creek 3H are waiting for completion of a temporary sales pipeline. St. Mary Land & Exploration Company plans no more drilling in the Marcellus Shale in 2009.

Southwestern Energy Company - Marcellus Shale Update

Southwestern Energy Company (SWN) discussed its operations in the Marcellus Shale during its third quarter earnings conference call held on October 30, 2009.

2010 Drilling Plans

“We have not completely finalized 2010 budget. We’ve been working in 2009 to capture the water we need to drill, really with the three-rig program. We are forming wells right now. I don't know that it will end up to be a three year rig program next year, but you should see us drilling early in the year in Pennsylvania, and then we'll kind of give more guidance on that as we finalize our capital budget.”

Marcellus Shale Acreage Location

“We have acreage in Bradford, Susquehanna as our major acreage positions and then we've got a little bit in couple other counties in Pennsylvania. In Lycoming, we have just over 20,000 acres and between Bradford and Susquehanna.”

Source: Seeking Alpha

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Ultra Petroleum - Marcellus Shale Update - Part II

Ultra Petroleum Corp. (UPL) discussed its operations in the Marcellus Shale during its third quarter earnings conference call held on October 30, 2009. The company is planning a major ramp in drilling in the Marcellus Shale in 2010, and still is developing its Pinedale acreage.

Reserves

“We have roughly 1200 net locations at 100-acre space. If we also conservatively estimate potential EUR per well at 3.75 Bcf, the reserve potential is at least 4.5 TCF, net to Ultra.”

Well Costs

“Typical cost to drill and complete an average 4,000-foot lateral section ranges from $3 million to $3.5 million.”

Lateral Length

“Our horizontal Marcellus wells typically range from 9400 to 10,500 feet, total drill depth, with lateral lengths typically ranging from 3800 to 4400 feet.”

2010 Capital Plans

“We expect to drill an additional five operated and 11 non-operated horizontal Marcellus wells before year-end, for a total of 36 horizontal Marcellus wells in 2009. Our 2010 Marcellus drilling program is expected to include at least 100 horizontal wells.”

Source: Seeking Alpha

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Ultra Petroleum - Marcellus Shale Update - Part I

Ultra Petroleum Corp. (UPL) discussed its operations in the Marcellus Shale during its third quarter earnings conference call held on October 30, 2009. The company has 172,000 net acres in the Marcellus Shale.

Operations

“In the third quarter, we drilled a total of 12 horizontal wells in our five county focus area in north central Pennsylvania. Those are Potter, Tioga, Bradford, Lycoming, and Sullivan counties.”

“10 Marcellus wells currently producing. The seven horizontal wells brought online during Q3 2009 at IPs averaging 6.4 million cubic feet per day with the best well IPing at 10.46 million cubic feet per day.”

“Net production in Pennsylvania as of October 29, 2009, is 1.72 Bcf, and we anticipate a year-end exit rate of 30 million cubic feet per day, net to Ultra, in Pennsylvania.”

Estimated Ultimate Recovery

“We are using a type curve for our Marcellus model that uses an expected EUR per well of 3.75 Bcfe. Early performance, even with some surface constraints, has definitely exceeded this.”

Source: Seeking Alpha ___________________________________________________________________

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Cabot Oil and Gas - Marcellus Shale Update - Part Two

Cabot Oil & Gas Corp. (COG) discussed its acreage in the Marcellus Shale during its third quarter earnings conference call. The company is focused on developing its acreage in Northeastern Pennsylvania.

2010 Marcellus Shale Capital Plan

“Approximately two-thirds of our (2010) spending will be in the Marcellus where we will plan to drill 73 horizontal wells plus 10 vertical wells.”

Marcellus Shale Decline Rates

“We have nine and more production and three of those have produced over 1 Bcf. Those wells have exceeded our expectation, i.e., have a shallower decline than we had originally modeled.”

Marcellus Shale EUR

“But we think that curve fit is going to be 4.5 to 5 Bcf plus is going to be the curve fit of our horizontal wells.”

Marcellus Shale Well Cost

“On the Marcellus wells, we are right now about $3.6 million with those completions completed well cost.”

Source: Seeking Alpha

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Cabot Oil & Gas - Marcellus Shale Update - Part One

Cabot Oil & Gas Corp. (COG) discussed its acreage in the Marcellus Shale during its third quarter earnings conference call. The company is increasing its takeaway capacity from the current 110 million cubic feet (mmcf) per day to 275 mmcf per day. Cabot Oil and Gas currently produces 50 mmcf per day.

Completions

“We have commenced the completion of our first Marcellus well for the fourth quarter with numerous completions scheduled to follow.”

“We have 13 horizontals and nine vertical wells in the queue waiting on completion...Our plan is to complete at least one horizontal frac well per week for the remainder of the year.”

Acreage

“We currently have over 170,000 acres under lease in our play and continue to lease. Even though lease bonuses have escalated over the last few months, Cabot is still remaining competitive in acquiring leases.”

“We’ve drilled 17 horizontal Marcellus wells in our 2009 program so far and have an additional 16 horizontal wells remaining for the rest of the year.”

Source: Seeking Alpha

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Hess Corp Discusses Marcellus Shale

Hess Corp (HES) held its third quarter earnings conference call on October 28, 2009, and made the following comments on the Marcellus Shale. The company fleshed out its strategy on unconventional gas plays.

“If you take the long view and you look at where the energy mix in the world is going to come from in the future, clearly unconventional is going to play a big part, not only in oil, but also in gas. So we feel we need to build a position in both of those areas.”

“Now in unconventional oil, obviously we’ve got the Bakken, and we felt like to round out a portfolio we wanted to build a position in unconventional gas. That’s going to be confined right now to the Marcellus.”

Source: Seeking Alpha

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Newfield Exploration Company Comments On the Marcellus Shale

Newfield Exploration Company (NFX) discussed the Marcellus Shale during its third quarter earnings conference call held on October 22, 2009.

Marcellus Shale Joint Venture

“Entered the Marcellus Shale through a new agreement with Hess covering up to 140,000 gross acres primarily in Susquehanna and Wayne Counties, Pennsylvania. This is a ground-floor agreement, which Newfield will operate. Each company will have a 50% interest.”

Acreage Location

“Northeast Pennsylvania and Susquehanna and Wayne Counties, the thing that attracted us to that area and if you looked at the maps, it is the area where the Marcellus is thickest. We think it has got all the right attributes to be a major significant resource.”

Source: Seeking Alpha ___________________________________________________________________

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CNX Gas Corp Comments On The Marcellus Shale

CNX Gas Corp (CXG) reported its earnings for the third quarter of 2009, and made the following comments on its conference call. One advantage that CNX Gas Corp discussed was that it pays almost no royalty on its acreage because the mineral rights are held by Consolidated Energy, its parent company. This can give the company an advantage over its competitors who are leasing land at thousands of dollars an acre, and paying a percent of the revenue.

Marcellus Shale Acreage

“Our current footprint is 230,000 acres (in the Marcellus Shale) of which 2/3 are considered by most to be category Tier 1 acres. We are actively seeking additional acreage. Our goal is to increase our position to 250,000 total acres by the end of the year. Our acquisition efforts remain focused on southwest Pennsylvania and northern West Virginia where we have many inherent advantages.”

Rate of Return

“We can earn a 26% after-tax return on our horizontal Marcellus Shale wells with $5 gas. Keep in mind that all this drilling has occurred on acreage that CNX Gas owns in fee. This means that we have 100% net revenue interest. No other producer that I'm aware of can say this.”

Source: Seeking Alpha

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Range Resources Corporation And The Marcellus Shale - Part Two

Range Resources Corporation (RRC) reported its third quarter of 2009 earnings and made the following comments on its operations in the Marcellus Shale during its conference call.

Estimated Ultimate Recovery

“To-date, our average well has been about 4.4 Bcfe which is above the top end of the range. I would caution that more wells and more production are necessary to determine what the actual number will be.”

Production

“At year-end 2007 Range’s Marcellus production was about eight million per day net. At year-end 2008 we’re producing about 26 million per day net. At year-end 2009 we should be about 90 million to 100 million per day and we’re currently planning on doubling that to 180 million to 200 million per day by year-end 2010.”

Source: Seeking Alpha

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