Record natural gas and liquids production at Consol Energy Inc. was overshadowed during the first quarter by low commodity prices that pushed profits lower, hurt sales revenue and forced the company to implement more cost-cutting measures.

Consol produced 71.6 Bcfe, up 48% from the year-ago period when it produced 48.4 Bcfe and a slight increase from the 70.5 Bcfe it produced in the fourth quarter. But as commodity prices continued to decline, cutting into those production gains, management said it expects to sap another $80 million in savings from its operations this year in addition to the $150 million it has cut from administrative and capital costs over the last two months.

Those savings came from more efficient coal operations, breaks on oilfield services and “headcount reductions,” CFO David Khani said. Earlier this month, Consol confirmed that it was cutting about 5% of its workforce (see Shale Daily, April 10).

“Our 150-year legacy provides us with a lot of benefits. But as much as that legacy is constructive in terms of how we’ve navigated the cyclical nature of the energy business in the past, make no mistake about it, we won’t be bound by the past,” CEO Nicholas Deluliis told analysts on Tuesday during a call to discuss first quarter earnings. “So the culture here, frankly, is one that has embraced change and acknowledges the shifting nature of the energy business.”

The company cut its capital expenditures budget in March from $1 billion to $920 million (see Shale Daily, March 13). It expects to produce 71-75 Bcfe this quarter.

Consol spent a combined $172 million during the quarter on a sizeable acquisition in the Utica Shale, a share buyback program and on debt repayment. The company also said it had entered a sales agreement with an undisclosed utility customer for contractual volumes of either coal or natural gas, “depending on which one of Consol’s products is more cost-effective for the utility” each month.

Management said the company also acquired 20,000 contiguous Utica Shale acres, but downplayed the move amid a depressed commodity price environment and other activity at the company set for later in the year, including plans to split its exploration and production and coal divisions.

Delullis said the new Utica acreage would not likely be developed until 2016 or after.

Consol’s average sales price sank from $5.52/Mcfe in 1Q2014 to $3.56/Mcfe last quarter, which also dropped from $3.90/Mcfe in the fourth quarter. As a result, net income decreased to $79 million (34 cents/share) from $116 million (50 cents/share) in the year-ago period. Year-over-year sales revenue also dropped from $267 million to $255 million.

Natural gas liquids, oil and condensate volumes were 8.1 Bcfe, or 11% of the company’s quarterly production. At the same time last year, liquids accounted for just 4% of Consol’s production. The Marcellus Shale continued to drive growth in the first quarter, when volumes reached 36.3 Bcfe.

While Consol drilled 23 Marcellus wells during the quarter and turned 20 to sales, it expects its Utica Shale program to expand with an increase in activity outside Ohio. The company is drilling a Utica well in southwest Pennsylvania’s Westmoreland County. It plans to drill another in nearby Greene County this quarter. Consol’s Marcellus joint venture partner, Noble Energy Inc., also drilled a deep Utica well in Marshall County, WV.

The company’s Utica wells produced 9.5 Bcfe during the quarter. Management said results from the new wells are expected later this year.