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 January 20, 2016 - 5:29 PM EST
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PDC Energy Announces Year-End 2015 Proved Reserves of Approximately 273 MMBoe and Full-Year 2015 Production Increase of 65% to 15.4 MMBoe

DENVER, Jan. 20, 2016 (GLOBE NEWSWIRE) -- PDC Energy, Inc. ("PDC," the "Company," "we" or "us") (NASDAQ:PDCE) today reported year-end 2015 proved reserves and full-year production.

Year-End 2015 Highlights

  • Proved reserves of 272.8 million barrels of oil equivalent (“MMBoe”), an approximate 9% increase over year-end 2014 proved reserves with estimated reserve replacement of 247%
     
  • Increased well-density on proved undeveloped horizontal (“PUD”) Niobrara locations in the Wattenberg Field from eight to 16 wells per section-equivalent due to the continued success  of downspacing
     
  • 2015 production of 15.4 MMBoe representing 65% year-over-year growth and exceeding top-end of guidance

CEO Commentary

Bart Brookman, President and Chief Executive Officer, commented, “Our ability to high-grade our development plan and increase proved reserves in the current price environment is a true testament to the depth, quality and resilience of our middle core Wattenberg inventory.  We had tremendous 2015 production of approximately 15.4 MMBoe, highlighted by our ability to drive efficiencies from a cost, operating and technological standpoint.  Our top priority for 2016 is maintaining our solid balance sheet and strong debt metrics. We believe our flexible and efficient Wattenberg drilling program positions us to continue to deliver long-term shareholder value.”

2015 Proved Reserves

PDC’s total proved reserves as of December 31, 2015 increased 9% to 272.8 MMBoe compared to 250.1 MMBoe reported at year-end 2014 and were 60% liquid, 40% natural gas and 26% proved developed.  The growth in proved reserves was primarily a result of the increased well-density of PUD locations in the Company’s middle core Wattenberg that allowed for the subsequent optimization of the Company’s five-year development plan. Total gross PUD locations in Wattenberg increased to approximately 790.

PDC’s independent reserve engineering firm, Ryder Scott Company, L.P., completed its estimate of the Company’s year-end 2015 proved reserves in accordance with Securities and Exchange Commission (“SEC”) guidelines using NYMEX prices of $50.28 per barrel (“Bbl”) for crude oil and $2.59 per million British Thermal Units (“MMBtu”) for natural gas, before adjustments for energy content, quality, midstream fees, and basis differentials. 

The value of the Company’s proved reserves, discounted at ten percent and before tax (“PV10”), decreased to $1.3 billion as of December 31, 2015 compared to $3.5 billion as of year-end 2014. The decrease in PV10 is primarily a result of a 47% and 41% decrease in the average NYMEX oil and gas price, respectively.

 
2015 Year-End Proved Reserves Summary
 
 

 
Proved
Reserves

(MMBoe)
BTAX
PV-10
($MM)
BTAX
PV-10
($/Boe)
Beginning balance at December 31, 2014 250.1 $3,450 $13.80 
Drilling, extensions, additions and revisions 38.1   
2015 production from continuing operations (15.4)  
Ending balance at December 31, 2015 272.8 $1,337 $4.90 
          

The Company has stress-tested its proved reserves to determine the impact of lower crude oil prices. Replacing the 2015 SEC NYMEX crude oil prices with those shown in the table below, and leaving all other parameters unchanged, results in a decrease in PDC’s total proved reserves of 6% or less.

 
 2015 Year-End Proved Reserves Price Stress Test
 
 

Pricing Scenario - NYMEX
Proved
Reserves

(MMBoe)
Changes
from SEC
Reserves
$50.28/Bbl, $2.59/MMBtu (SEC)272.8 - 
$40.00/Bbl, $2.59/MMBtu266.1 (2%)
$30.00/Bbl, $2.59/MMBtu256.5 (6%)
     

Operational Update

PDC’s full-year 2015 production was approximately 15.4 MMBoe or 42,100 Boe per day, a 65% increase compared to 2014 production.  The Company continues to see encouraging results related to increased drilling efficiency, completion technology and reduced line pressure in the Wattenberg Field.  In the fourth quarter, the Company turned-in-line 43 horizontal wells, including the 13 well Rieder project testing 26 wells per section-equivalent spacing.

Upcoming Investor Presentations

PDC is scheduled to present at the Credit Suisse Energy Summit in Vail, Colorado on February 23, 2016. Please see the Company’s website at www.pdce.com for details and webcast information. The related slide presentation is expected to be available on the Company’s website immediately prior to the events.

Analyst Day

The Company plans to host an Analyst Day on Thursday, April 7, 2016 at the Brown Palace Hotel in Denver, Colorado. PDC also plans to webcast the event.

About PDC Energy, Inc.

PDC Energy, Inc. is a domestic independent exploration and production company that produces, develops, acquires and explores for crude oil, natural gas and NGLs with primary operations in the Wattenberg Field in Colorado and in the Utica Shale in southeastern Ohio. Our operations in the Wattenberg Field are focused on the liquid-rich horizontal Niobrara and Codell plays and our Ohio operations are focused in the condensate and wet gas portion of the Utica Shale play. PDC is included in the S&P SmallCap 600 Index and the Russell 2000 Index of Companies.

NOTE REGARDING FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 regarding PDC's business, financial condition, results of operations and prospects. All statements other than statements of historical facts included in and incorporated by reference into this release are forward-looking statements. Words such as expects, forecast, guidance, anticipates, intends, plans, believes, seeks, estimates, will and similar expressions or variations of such words are intended to identify forward-looking statements herein, which may include statements regarding PDC’s 2015 proved reserves, PDC's future production (including the commodity mix of such production) and development plan; rates of return on projects; future costs and financial conditions; per well reserves and performance; anticipated cost savings and efficiencies; anticipated impairments; future debt metrics; and management's strategies, plans and objectives. However, these are not the exclusive means of identifying forward-looking statements herein. Although forward-looking statements contained in this press release reflect the Company's good faith judgment, such statements can only be based on facts and factors currently known to PDC. Consequently, forward-looking statements are inherently subject to risks and uncertainties, including risks and uncertainties incidental to the exploration for, and the acquisition, development, production and marketing of natural gas and oil, and actual outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. Important factors that could cause actual results to differ materially from the forward-looking statements include, but are not limited to:

  • changes in worldwide production volumes and demand, including economic conditions that might impact demand;
  • volatility of commodity prices for crude oil, natural gas and NGLs, including the risk of an extended period of low commodity prices;
  • the impact of governmental policies and/or regulations, including changes in environmental and other laws, the interpretation and enforcement related to those laws and regulations, liabilities arising thereunder and the costs to comply with those laws and regulations;
  • potential declines in the value of our crude oil, natural gas and NGLs properties resulting in impairments, and potential inaccuracies in preliminary estimates of impairments;
  • potential inability to achieve expected improvements in efficiency and drilling results;
  • changes in estimates of proved reserves;
  • inaccuracy of reserve estimates and expected production rates;
  • potential for production decline rates from our wells being greater than expected;
  • timing and extent of our success in discovering, acquiring, developing and producing reserves;
  • our ability to secure leases, drilling rigs, supplies and services at reasonable prices;
  • availability of sufficient pipeline, gathering and other transportation facilities and related infrastructure to process and transport our production and the impact of these facilities and regional capacity on the prices we receive for our production;
  • timing and receipt of necessary regulatory permits;
  • risks incidental to the drilling and operation of crude oil and natural gas wells;
  • our future cash flows, liquidity and financial condition;
  • competition within the oil and gas industry;
  • availability and cost of capital;
  • reductions in the borrowing base under our revolving credit facility;
  • our success in marketing crude oil, natural gas and NGLs;
  • effect of crude oil and natural gas derivatives activities;
  • impact of environmental events, governmental and other third-party responses to such events, and our ability to insure adequately against such events;
  • cost of pending or future litigation;
  • effect that acquisitions we may pursue have on our capital expenditures;
  • our ability to retain or attract senior management and key technical employees; and
  • success of strategic plans, expectations and objectives for our future operations.

Further, PDC urges you to carefully review and consider the cautionary statements made in this press release and the Company's filings with the SEC for further information on risks and uncertainties that could affect the Company's business, financial condition and results of operations, which are incorporated by this reference as though fully set forth herein. The Company cautions you not to place undue reliance on the forward-looking statements, which speak only as of the date hereof. PDC undertakes no obligation to update any forward-looking statements in order to reflect any event or circumstance occurring after the date of this release or currently unknown facts or conditions or the occurrence of unanticipated events. All forward-looking statements are qualified in their entirety by this cautionary statement.

Before tax PV-10 is a non-GAAP measure and is different than the standard measure of discounted future net cash flows (“standardized measure”), which measure will be presented in PDC’s upcoming Annual Report on Form 10-K, in that before tax PV-10 is a pre-tax number, while standardized measure includes the effect of estimated future income taxes. Estimates of non-proved reserves, including 3P reserves, are based on more limited information, and are subject to significantly greater risk of not being produced than proved reserves.

Contacts:           

Michael Edwards
Senior Director Investor Relations
303-860-5820
michael.edwards@pdce.com

Kyle Sourk 
Manager Investor Relations
303-318-6150
kyle.sourk@pdce.com

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Source: GlobeNewswire (January 20, 2016 - 5:29 PM EST)

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