Consol Energy Inc. executives said Tuesday that the company is marketing a “bucket” of coal and natural gas assets that it values at up to $2.3 billion. It hopes any sales can raise more cash and help deleverage its balance sheet as the company continued to weather the commodities downturn in the third quarter.

CEO Nicholas Deluliis said 30 separate “processes” are ongoing to sell the assets, which are valued between $1.55 and $2.3 billion. A company spokesman said they include coal, gas, surface and midstream assets, adding that the company could earn more through drop downs to its master limited partnerships — Cone Midstream Partners LP and CNX Coal Resources LP. The company plans to use any proceeds to pay down debt and accelerate the separation of its coal and natural gas divisions.

“Those who make the prudent decisions now, in terms of controlling expenses and deploying capital and pragmatically handling the balance sheet, they’re going to be rewarded in the long run,” Deluliis said. “That’s exactly what we’re doing. Our 18-month base plan is highly achievable even if we face continued depressed commodity prices.”

Like some other exploration and production (E&P) companies, Consol’s year has been marked by cost-cutting, staff cuts and a sharper focus as oil and gas prices have fallen and coal markets continue to take a beating (see Shale Daily, July 20). It has faced pressure from investors to increase value; laid off more than 600 employees; cut retiree health benefits earlier than expected; idled its drilling program until 2017 and announced an asset monetization program that has thus far led to a $101 million sale of some coal assets (see Shale Daily, July 22).

While some of those steps paid-off in the third quarter, as Consol reported net income of $119 million (52 cents/share) compared to a net loss of $2 million (minus 1 cent/share ) in the year-ago period, without them profits would have fallen. Consol reported an adjusted net loss of $64 million (minus 28 cents/share).

Consol produced a record 86.1 Bcfe, up from 64.9 Bcfe in the year-ago period and 75.5 Bcfe in 2Q2015. But its E&P revenue dipped from $257.8 million in 3Q2014 to $202.3 million, as CFO David Khani said “the main driver of our negative adjusted earnings for the quarter was lower thermal coal production, natural gas, liquids and [metallurgical coal] realizations.” Consol’s average natural gas and liquids price was $2.35/Mcfe, down from $2.68/Mcfe in 2Q2015 and $3.97/Mcfe in the year-ago period.

With the company’s drilling rigs suspended through next year, management acknowledged that the Consol would not have the kind of uncompleted well backlog to grow production in 2017. The company expects fourth quarter production to reach 92-97 Bcfe, which would bring its year-over-year production growth to 39%. Its uncompleted wells are also expected to help grow annual production next year by 20%.

But without the backlog, Consol hopes its growing position in the Utica Shale, where it continues to see success, can lift production in 2017. Most of its third quarter production — 44.9 Bcfe — came from the Marcellus Shale, while the Utica Shale produced 15.3 Bcfe. Utica volumes have continued growing in recent quarters. The company said in July that its Gaut 4IH well in Westmoreland County, PA, tested at more than 61 MMcf/d (see Shale Daily, July 29).

In the third quarter, Consol tested its Switz 6D Utica well in Monroe County, OH, at 44.7 MMcf/d, shattering previous records there. The success in Southwest Pennsylvania — where the company plans to hydraulically fracture its second well in Greene County, PA, this quarter — and in Ohio has Consol reconsidering its portfolio.

“Over the next two to three years [we] expect the dry Utica to become the primary focus of our development plan and a greater and greater contributor to production growth,” said COO Timothy Dugan.

Consol has more than 600,000 net acres prospective for the Utica. Other companies, including Range Resources Corp. and EQT Corp., which both recently tested Utica wells in Southwest Pennsylvania at more than 50 MMcf/d, have also said they are considering building more deep dry Utica wells into next year’s capital budgets (see Shale Daily, Oct. 22; Aug. 25).

But concerns remain about decline rates. So far, Consol’s Gaut well continues to perform. The company is in the middle of a 65-day flow test to determine reservoir deliverability and well drainage.

“The pressure decline is getting shallower and shallower each day. Pressures are remaining higher than what we had originally anticipated,” Dugan said. “We’re halfway through the flow period, so I don’t think we’re ready to talk about what that well is going to do, but we certainly expect that it’s going to flow at a stable rate for some period of time. But I don’t know if we’re ready to say that it’s going to do that for three months, six months, nine months.”

For now, management added, the company’s Ohio Utica joint venture (JV) with Hess Corp. has essentially been suspended. Hess has increasingly focused on liquids production offshore and in North Dakota’s Bakken Shale. It has sold some of its drier Utica assets in recent years (see Shale Daily, Jan. 29, 2014). The JV has been active in Harrison, Belmont, Guernsey and Noble counties.

“The carry is pretty much exhausted, and I think we pretty much have stopped activity as well,” Khani said of the JV. “It’s not economic really to drill wet wells.”

At the end of the third quarter, Consol had $854.5 million in liquidity, consisting of $80 million in cash and $774.5 million available under its credit facility.