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Longer Laterals and More Proppant Helping Rex Energy Lift IP Rates

Rex Energy Corp. said Monday that it has placed another six Marcellus Shale wells into sales in its core Butler Operated area in western Pennsylvania, with longer laterals and higher sand concentrations that it believes will lead to improved type curves in the play.

The company drilled and completed the four-well Powell pad in Butler County, PA, with an average lateral length of 5,500 feet and 2,300 pounds of sand per lateral foot. Each well has produced at an average five-day sales rate of 9.3 MMcfe/d. In the same area, Rex drilled and completed the two-well Hamilton pad with an average lateral length of 4,700 feet and 2,300 pounds of sand per foot. Those wells have produced at an average five-day sales rate of 7.8 MMcfe/d.

Rex has been drilling longer laterals across much of its acreage in the Appalachian Basin, drilling more wells on each pad and tightening downspacing in its key legacy Butler Operated area. Its laterals increased from an average of about 3,500 feet at the end of 2010 to about 5,000 feet last year. In February, CEO Tom Stabley said Rex averaged about 1,800 pounds of sand per foot in western Pennsylvania last year. The volume has since increased to between 2,200 and 2,500 pounds, he said (see Shale Daily, Feb. 19).

"The results of the Powell and Hamilton pads support our belief that increased sand concentration utilized during the completion process results in higher [initial production rates] and better performance on our Marcellus type curve," Stabley said.

Management said at the end of the fourth quarter that with more data, Rex could increase type curves in western Pennsylvania from 10.7 Bcfe to 14 Bcfe by the end of this year.

The company also said Monday that it has released its second rig in the basin. It will continue to operate just one rig, mainly in Pennsylvania, for the remainder of the year.

In its new Moraine East area in northeast Butler County, which the company acquired in a deal with Royal Dutch Shell plc last year, Rex said it has completed drilling operations at its four-well Renick pad (see Shale Daily, Sept. 16, 2014; Aug. 13, 2014). Those wells were drilled to an average lateral length of 5,820 feet. Rex said it would begin completion operations at that pad later this month.

The Renick is key for Rex; management has said preliminary reservoir analysis shows the acreage to be analogous with the company's legacy Butler assets. More data there would help the company in its search for a joint venture partner in the Moraine East to offset capital spending this year.

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