Rex Energy Corporation (“Rex Energy”) (REXX) today announced its 2015 capital budget and production guidance and provided a financial update.

2015 Capital Budget and Production Guidance

The company expects its 2015 operational capital expenditures to be between $180 million and $220 million, a decrease of approximately 44% from the midpoint of its 2014 capital expenditure guidance and a decrease of 43% from the midpoint of its previously announced preliminary 2015 capital expenditure plans. Despite this reduced level of capital expenditures, the company anticipates that its average daily production for 2015 will be between 196 MMcfe/d and 205 MMcfe/d. The company expects production growth of approximately 33% at the midpoint of 2015 average daily production guidance as compared to the midpoint of 2014 average daily production guidance. The expected significant production growth in 2015 is due to the company focusing on its highest quality assets and locations.

In addition, given the strong performance of its recent wells, the company continues to expect it will fully utilize its dedicated processing capacity at the Bluestone and Sarsen facilities near the end of the first quarter of 2015. The company expects the Bluestone III processing facility to be placed in service early in the fourth quarter of 2015.

Additional details regarding the company’s capital expenditure budget for 2015 ($ in millions) are shown below:

Basin — Butler
Basin —
Ohio Utica
Total 2015 Capital Budget1 ~$115 – $140 ~$45 – $60 ~$20 ~$180 – $220

(1) Land acquisition expense and capitalized interest are not included in the operational capital expenditures budget

“Given the current commodity price environment, we feel that Rex Energy’s 2015 capital budget allows the company to significantly grow production while also maintaining financial flexibility,” said Tom Stabley, Rex Energy’s Chief Executive Officer. “Our 2015 capital budget is designed to target our highest quality assets and we believe the continued production growth we anticipate in 2015, even at a reduced capital budget, continues to illustrate the quality of our asset portfolio and operational efficiency.”

Financial Update

Rex Energy’s bank group has unanimously approved an amendment to the company’s senior secured credit facility. The approved amendment replaces the previous leverage covenant for the senior secured credit facility with a new leverage covenant limiting senior secured borrowings to 1.75 times the company’s trailing twelve month EBITDAX. Given the company expects to exit 2014 with no borrowings outstanding under its senior secured credit facility, this change to the leverage covenant provides Rex with substantial financial flexibility.

“I would like to thank our bank group for their continued support of Rex Energy,” said Tom Stabley, Chief Executive Officer of Rex Energy. “Given the current commodity price environment, we felt it was important to continue to be proactive in our efforts to enhance our financial flexibility.”

In addition, Rex Energy has engaged RBC Capital Markets, LLC as a strategic advisor in order to pursue the monetization of its 60% ownership interest in Keystone Clearwater Solutions, the company’s water service subsidiary. Assuming this transaction is completed as planned, the proceeds from the transaction would further enhance the company’s strong liquidity position. The company expects to provide an update on the progress of the monetization in the first half of 2015.

Finally, the company has decided to continue its pursuit of a joint venture partner for its Moraine East development area in 2015. The company has recently begun drilling its first well in the Moraine East area, and expects to have initial production results early in the second quarter of 2015. The company’s updated capital expenditure budget for 2015 assumes that the company retains its 100% ownership in the Moraine East area.

About Rex Energy Corporation

Rex Energy is headquartered in State College, Pennsylvania and is an independent oil and gas exploration and production company operating in the Appalachian and Illinois Basins within the United States. The company’s strategy is to pursue its higher potential exploration drilling prospects while acquiring oil and natural gas properties complementary to its portfolio.

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