EQT Corporation presents at EnerCom’s The Oil & Gas Conference®
During EQT’s breakout sessions, management was asked the following questions:
- Are you seeing any degradation from longer laterals in the Marcellus, 5,000 ft, 10,000 ft, to 15,000 ft laterals?
- Can you draw any conclusions on ceramic white sand?
- What kind of decline curve is on Scott’s Run and why is it such a good well?
- When you are fracking Marcellus is the pressure loss going all the way into the Upper Devonian?
- Did the rock look different on the Utica? What is the reason for variability in production?
- Are the unit configurations different for the longer laterals? Are operators more willing to swap acreage in order to drill the longer laterals?
- What would you say is your normal acreage size?
- Is the Ohio valley connector contingent on REX expansion? Does it tie into other midstream besides REX?
- Where have you found the most success in driving down the costs of drilling in the Utica?
You can listen to EQT’s presentation by clicking here.
For the company’s second quarter results, click here.
Focusing on Core Marcellus Acreage
EQT Corporation (ticker: EQT) will is a major upstream and midstream oil and gas company that has operated in the Appalachian Basin for over 125 years. The company is in the top 5 largest producers of natural gas in the United States. EQT uses advanced horizontal drilling technology to minimize the potential impact of drilling-related activities and reduce its environmental footprint.
The company owns approximately 3.4 million gross acres, which include 660,000 gross acres in the Marcellus play, more than 13,000 gross productive wells, and 10.0 trillion cubic feet of proved natural gas, NGL, and crude oil reserves. The company holds acreage in Kentucky, Ohio, Texas, West Virginia, Virginia, and Pennsylvania. Most of the acreage is held by production from historic shallow wells and the average working interest exceeds 86%. The company presentation lists 3,370 drilling locations.
Highlights of the company’s 2Q 2016 activities include a 26% increase in production sales volume, an 11% increase in midstream gathering sales, and a 14% increase in transmission revenue. These results coincided with a 23% decrease in realized prices. In the second quarter, the company drilled 27 gross wells in the Marcellus with an average length of pay of 6,400 feet.
The company plans to spud 63 additional wells in the second half of 2016 and end the year with 135 total Marcellus and Upper Devonian wells drilled. Due to lower well costs offsetting the costs of increased activity, forecasted 2016 capital expenditure remains unchanged at $1.0 billion.
On July 8th, the company closed a transaction with Statoil to acquire 62,500 Marcellus acres in its core development area of West Virginia that are continuous with current acreage and yield stacked pay. The company also acquired drilling rights to 53,000 net acres in the deep Utica.
This acquisition will allow average lateral lengths for 106 wells to be extended from 3,000 feet to 6,500 feet, lowering overall costs and improving well economics. A portion of the acquisition was funded by a $796 million common stock offering.
EQT Midstream Partners (ticker: EQM) provides midstream services to the company and third party companies through strategically located transmission, storage, and gathering systems in the Marcellus and Utica regions. The EQT Midstream is an MLP and by the end of the year will be in control of all midstream assets following dropdowns from EGT Corporation. The company owns 700 miles, operates an additional 200 miles of FERC-regulated interstate pipelines, and owns 1,600 miles of high and low pressure gathering lines with multiple delivery interconnects with the transmission and storage system.
