Facing low natural gas prices and with more production data on hand, Rice Energy Inc. said Thursday that it would increase the spacing between its Ohio Utica Shale wells and revise estimated ultimate recoveries (EUR) in the play.

The company is switching to 1,000-foot interlateral spacing instead of the 750-foot interlateral spacing it has been employing. Rice is the latest operator to announce such a move amid the commodities downturn. Earlier this month, Gulfport Energy Corp. said it would increase spacing to 1,000 feet to save money on lease expirations and acreage renewals in the Utica (see Shale Daily, Feb. 18).

Rice has 16 wells online in the play and said it was observing interference between wells spaced at 750 feet. The Utica wells also have had a steeper decline curve than expected. The company said its EURs in the play would go from 2.50 Bcf per 1,000 feet to 2.33 Bcf on the wider spacing.

“The widened Utica spacing is a function of two primary factors: lower gas prices and increased well productivity,” said CEO Daniel J. Rice. “From a returns and present value perspective, in this commodity price environment, well economics make more sense at spacing wider than 750 feet in order to maximize PV-10 field-wide.

“As for EURs, we have more data from flat-time production and initial decline observations to better inform the shape of our type curve. The production and decline data was telling us wider spacing would generate improved performance and more value.”

The company said it would also increase its laterals in the play to 9,000 feet, which could ultimately increase total EURs for utica wells from 20 to 21 Bcf. Wider spacing, however, would reduce its dry gas drilling locations from 302 to 168.

Changes in the Utica program compared to better EURs in the Marcellus Shale of Pennsylvania, which have increased from 1.98 Bcf per 1,000 feet of lateral to 2.16 Bcf on more production history and better choke management. Rice’s total EURs in the play are now expected to go from 13.9 Bcf to 15 Bcf.

Rice continued to set production records in the fourth quarter and the full year. In the fourth quarter, the company produced 624 MMcfe/d, up from 398 MMcfe/d in the year-ago period and up from 609 MMcfe/d in 3Q2015. The Marcellus, where Rice operates in just two counties, continued to account for the bulk of the company’s volumes, producing 446 MMcfe/d during the period. The Utica accounted for 174 MMcfe/d.

Full year production averaged 552 MMcfe/d, which was 5% above guidance and up from 2014 when the company produced 274 MMcfe/d.

Rice also reported a 74% year-over-year increase in throughput on its midstream systems in the fourth quarter at Rice Midstream Holdings LLC in Ohio and Rice Midstream Partners LP in Pennsylvania. Management said those assets would continue creating more value for the company in the coming years.

The company said its exploration and production budget would be $640 million this year, a 14% decrease from 2015 levels. It guided for 2016 production of 700-740 MMcfe/d. The company dropped a rig in January and is currently running one rig in the Marcellus and another in the Utica.

CFO Grayson Lisenby said capital would primarily be spent in the first half of the year, with reductions in drilling and completion activity starting in the second half. Rice plans to exit 2016 with a backlog of 35 drilled but uncompleted wells to better position for 2017.

Full year revenue increased to $502.1 million from $390.9 million in 2014 on higher production. But the company’s average realized natural gas price for the full year, including hedges, decreased to $3.18/Mcf from $3.46/Mcf in 2014. The company currently has 87% of its 2016 production hedged at a weighted average floor price of $3.26/MMBtu.

Rice reported a net loss of $274.3 million (minus $2.06/share) for the fourth quarter, compared to net income of $104.4 million (76 cents/share) in the year-ago period. It also reported oil and gas property impairments of $18.3 million during the quarter.

For 2015, the company reported a net loss of $268 million (minus $2.14/share), compared to net income of $219 million ($1.70/share) in 2014.