Atlas Energy (ATLS) reported earnings for the second quarter of 2010, and discussed its Marcellus Shale operations during the earnings conference call. The company has more than 600,000 net acres across the Marcellus Shale.
“We have turned in the line two additional Greene County (Marcellus Shale) wells with peak 24-hour rates of approximately 5.5 million cubic feet equivalent per day and 4.1 respectively…and we’re now in the process of completing two additional Marcellus horizontal wells.
“The Westmoreland County 20h well is only our third Westmoreland County well. And the Laurel 2H well is our first Marcellus Horizontal well in Indiana County. Four additional Marcellus horizontal wells will be fraced in the next four weeks or so and 15 additional wells had been spud of which seven have already reached total depth.”
“Now being able to actually to increase our Marcellus net production as you know from the 33.2 million cubic feet equivalent per day released at the end of June 2010 to be over 500 million cubic feet equivalent per day net to Atlas Energy projected by 2014.”
“During the second quarter, we turned into line eight horizontal Marcellus shallow wells for own account and for the benefit of our partnership programs. And these wells came on an average of 5.1 million cubic feet per day… We landed each of these wells low in the Marcellus section, which is the most organic yet most brittle part of the formation. We have observed consistently strong results from this technique and are targeting all of our horizontal wells in the lower Marcellus.”
“We currently have four rigs running in the Marcellus, two of which are fit for purpose rigs, capable of drilling the deep lateral sections and the two remaining rigs are for air drilling the vertical topples. We have a third horizontal rig being delivered in the fourth quarter of this year, a fourth horizontal rig in the second quarter of 2011 and a fifth and sixth are being delivered in the third quarter of 2011.”
“The substantial majority of our acreage with Reliance is in the dry gas window of South Western Pennsylvania and is approximately 40% held by production. Our strategy is to continue to consolidate our acreage position in order to increase the number of wells we draw on a pad and to increase the lengths of our laterals.”