Rice Energy Inc. produced 747 MMcfe/d in the third quarter, up 23% from the year ago period.
But the company's acquisition of Vantage Energy last month overshadowed the period's results, giving it another 85,000 net acres in the Marcellus Shale, 52,000 of which are also prospective for the Utica Shale and 37,000 net acres in the Barnett Shale that will set it up for significant growth in 2017 (see Shale Daily, Sept. 26).
"The acquisition allows us to continue doing what we've been doing, but now at a higher activity rate for a longer period of time," CEO Daniel J. Rice said Thursday. The company completed an offering of 46 million shares last month, raising $1.2 billion to fund the $2.7 billion acquisition of Vantage. Management has said it will develop the new Marcellus and Utica assets at a rate of 45 net wells per year (see Shale Daily, Sept. 27).
Rice has set its preliminary 2017 guidance at 1.280-1.355 Bcfe/d to account for the acquisition. It's now guiding to exit this year at 780-800 MMcfe/d. Third quarter production was up from the 609 MMcfe/d it produced in the year-ago quarter, but flat from the 758 MMcfe/d it produced in 2Q2016 on a prior period adjustment of 27 MMcfe/d, CFO Grayson Lisenby said.
The company's leasehold position now stands at 235,000 acres, consisting of 176,000 Marcellus acres in Washington and Greene counties, PA, and 59,000 Utica acres in Belmont County, OH. Rice Midstream Partners LP's acreage dedication increased to 201,000 acres in Washington and Greene Counties with the Vantage acquisition. Throughput on the system during the third quarter was up 43% year/year to 957,000 Dth/d.
Revenue was up to $198.9 million on more production, compared to $143.6 million in the year-ago period. The company's average realized gas price during the third quarter was $2.87/Mcf, up from $2.81/Mcf in 2Q2016, but down from $3.18/Mcf in the year-ago period. Rice reported net income of $91 million (42 cents/share), compared to net income of $65.1 million (43 cents) in 3Q2015.