Range Resources Corp. said Monday that it lost 10 Bcfe of production during the fourth quarter due to unspecified operational issues at two natural gas processing facilities in southwest Pennsylvania operated by MarkWest Energy Partners LP.
The Houston Processing and Fractionation Facility and the Harmon Creek Complex in Washington County have since been returned to service after what Range said was an “extended curtailment.” Range now expects 4Q2018 production to come in at 2.15 Bcfe, or just below the 2.255-2.265 Bcfe range it had forecast for the period.
The company said its 2018 spending is estimated to be $20 million below the $941 million it forecast for the year. Range attributed the lower spending to a variety of factors, including drilling efficiencies and water recycling.
Investors aren’t rewarding outsized spending and growth as they continue to watch for capital discipline heading into the budget season. Early last year, Range laid out a plan to spend within its means going forward. The company said it generated free cash flow in the fourth quarter, adding that the efficiencies it gained are expected to offset a majority of the impacted cash flow from the processing downtime.
The company allocated the bulk of its 2018 spending toward the Appalachian Basin, where it has been intently focused as its assets in North Louisiana’s Cotton Valley Sands Terryville Complex have underperformed. Management has not ruled out selling those assets as a result.