Consol Energy Inc. said Friday it would reduce its drilling budget by another $80 million this year, revising its spending plans from a previously announced $1 billion to $920 million in reaction to depressed commodity prices.
The company said the revised budget does not include business development, permitting and land acquisitions, however. In January, the company said it would spend $1 billion to drill and complete wells in the Marcellus and Utica shales (see Shale Daily, Jan. 30). Consol spent about $1.3 billion on exploration and production in 2014.
The company said a majority of its spending this year would go toward dry natural gas development, aimed at growing year-over-year production by 30%. The Marcellus Shale continues to drive up volumes for Consol. It produced 235.7 Bcfe last year, of which 111.7 Bcfe was produced in the Marcellus. Consol has been focused in recent years on transitioning away from coal to natural gas (see Shale Daily, Oct. 28, 2013).
While fourth quarter production in the Marcellus Shale was 88% higher than in 4Q2013, the company also made gains in the Utica Shale. It produced 7.1 Bcfe there last quarter, well above the 0.5 Bcfe it produced at the same time in 2013.
The company said it would try to stay flexible to ramp-up production and spending if prices rebound in the second half of the year. For now, though, it expects 2016 production to increase 20% from 2015 levels.