After a recent buying spree to strengthen its position in the Appalachian Basin and gain entry to the region’s liquids-rich window, Southwestern Energy Co. won’t slow down next year, with plans to spend on its latest acquisitions and ramp-up production steadily.

CEO Steve Mueller said the company has hired more than 80 former Chesapeake Energy Corp. employees with a deep knowledge of the 413,000 net acres the company acquired from Chesapeake in southwest Pennsylvania and northern West Virginia in a deal that closed for $4.975 billion earlier this month (see Shale Daily, Dec. 24). In an update delivered during a conference call on Tuesday, the company also sought to reassure investors that it would fund a series of recent transactions in Appalachia with a combination of debt, equity, other securities and the sale of non-core assets in the next year, saying those moves would come depending on market conditions.

Company officials said the Chesapeake assets — primarily acquired in West Virginia — along with an additional 30,000 Marcellus Shale acres the company acquired in that area from Statoil ASA and another 46,700 acres it acquired in northeast Pennsylvania from WPX Energy Inc. won’t wait long for development (see Shale Daily, Dec. 23; Dec. 3).

“The plans for the acquisition acreage in West Virginia were intentionally evaluated, designed and funded to start in a measured fashion, learn very quickly and then ramp-up,” said Jeffrey Sherrick, executive vice president of corporate development. “We know that we need to add additional firm takeaway capacity beyond 2015 out of the local area.”

The company set a 2015 capital budget of $2.6 billion, up slightly from this year’s budget of $2.4 billion. A sizeable chunk of that will go toward developing its assets in the Appalachian Basin, where it now holds 782,000 net acres. Southwestern said it would drill up to 70 wells on its newly acquired acreage in southern Appalachia, most of which will be in West Virginia, where it will start 2015 with one rig and ramp-up to four by year’s end.

It will spend $625 million to develop the new assets and dedicate another $790 million to northeast Pennsylvania, where it spent $700 million this year.

Just as he did during a call after the company announced the Chesapeake deal in October, Mueller once again said that many companies seemed to be “missing the natural gas pricing signals” (see Shale Daily, Oct. 16) He said although benchmark natural gas prices have recently hovered below $3/Mcf and supplies have increased significantly in recent years, the trend is driving demand for Southwestern’s gas, with growth forecasted to last through the end of the decade.

“The period from 2012 to 2014 has shown us that the industry has a difficult time to economically supply gas to meet the increased demand created by gas prices in the low $3 range,” Mueller said. “But we have ample production to match demand with long-term prices around $4. That same demand also confirms that Southwestern Energy can generate great returns across the spectrum of those prices.”

Southwestern said it would target oil and natural gas production of 970-980 Bcfe in 2015, up from the 758-764 Bcfe it forecast for this year.

Other than saying its conventional Arkoma and East Texas assets would be sold by early next year, Southwestern provided little detail on what else it might sell to help fund its operations. That had analysts at Tudor, Pickering, Holt & Co. expressing concern about an “equity overhang” combined with weak natural gas and NGL prices. They still billed the recent acquisitions as transformative and said the new assets give the company optionality with their stacked pay potential.

BMO Capital Markets analyst Dan McSpirit said in a research note that there were few surprises in Southwestern’s funding plan, adding that the company has a strong financial position with a three-year growth plan that provides investors the kind of visibility that few operators can pull off.

By 2017, the company said it anticipates operating up to 685 wells across its footprint that would produce about 1.3 Tcfe. Southwestern also said it would pull back slightly next year in the Fayetteville Shale in Arkansas, where it plans to drill 20 wells, but it added that the field would still produce 470-475 Bcfe.

The rest of Southwestern’s production will come from the Appalachian Basin. The company said its exploratory programs in areas such as the Sand Wash Basin of Colorado will take a backseat to its new assets in the Northeast.