Antero Resources Corp. said Friday it produced 891 MMcfe/d in the second quarter, a 94% year-over-year increase that set a company record and passed the milestone of 1 Bcfe/d of net production.
That puts the Appalachian pure-play in an exclusive group of just a handful of operators working in the Marcellus and Utica shale plays that have neared or surpassed similar volumes, including Cabot Oil & Gas Corp., Range Resources Corp. and EQT Corp. In an operational update, Antero said it continued to make significant strides in securing more firm transportation and processing capacity, as well as improving its well completion techniques, particularly in the Marcellus Shale's southwestern core in West Virginia.
Among several previously announced agreements, the company said Friday that it has agreed to sell 50,000 MMbtu/d of natural gas, with options for incremental increases up to 200,000 MMBtu/d, to Cheniere Energy Inc.'s Sabine Pass liquefied natural gas (LNG) export terminal in Louisiana.
"With strong results in our Marcellus and Utica rich gas areas in early July, the company recently surpassed 1 Bcfe/d of net production for the first time in its history," said CEO Paul Rady. "With second quarter 2014 production meeting our plan and current production in excess of 1 Bcfe/d, we expect to meet our 2014 production guidance as well as our 45-50% growth targets for both 2015 and 2016."
Analysts at Tudor, Pickering, Holt & Co. called Antero's second quarter results solid and added that its production for the period was inline with the Street's 895 MMcfe/d estimates. They also said Antero's ongoing focus on firm transportation is giving the company favorable exposure to Gulf Coast and Midwest pricing points.
Antero said it’s completed and placed on line 330 horizontal Marcellus and Utica wells since its Appalachian operations began in 2009. The Marcellus continues to be a big part of that growth as the company said earlier in the week that 94% of its 9.1 Tcfe of proved reserves are located in the formation (seeShale Daily, July 16). Antero has utilized shorter stage lengths (SSL) on nearly all of the 70 Marcellus wells it has completed and tied to sales this year (see Shale Daily, Feb. 27; May 9).
Although that technique is costing 10-20% more than wells without SSL, Antero’s well results have improved 20-30%. Forty-seven of the 70 wells completed have had a 30-day average production rate of 12.9 MMcfe/d on ethane rejection, while its laterals are reaching in some instances beyond 10,000 feet, Antero said. At the end of the second quarter, the company had 75 net Marcellus wells in various stages of development.
In the Utica, Antero has completed and tied to sales 23 horizontal wells this year. Nineteen of those had an average 30-day production rate of 14.8 MMcfe/d on ethane rejection. The company had another 18 Utica wells in various stages of development at the end of the quarter.
Second quarter liquids production was up 387% year-over-year to 20,200 b/d and represented 14% of gas equivalent production during that time. Its four-well Bee Lewis pad in the Marcellus had a combined 79 MMcfe/d peak five-day sales rate, with 27% consisting of liquids. In the Utica, the three-well Carpenter pad had a combined five-day sales rate of 65 MMcfe/d, with 20% liquids.
Numerous processing commitments, Antero said, will provide it with 1.4 Bcf/d of Marcellus cryogenic capacity by 3Q2015 (see Shale Daily, May 7). And the company entered into 1.1 Bcf/d of transportation agreements, including deals to ship on the recently announced Energy Transfer Rover Pipeline Project and the Rockies Express pipeline, which began flowing to the Midwest last month (see Shale Daily, June 18; June 26).