Consol Energy Inc. said Friday that its natural gas production increased by 10% last year when compared to 2012, coming in at the low-end of its guidance. The company said its Marcellus Shale segment is expected to account for roughly half of forecasted production in 2014, or 87% more than last year.

In an operational update, the company said it drilled 55 horizontal shale wells in 2013, 46 of which were drilled into the Marcellus Shale and nine in the Utica. Consol said it expects to operate four-five horizontal rigs with its joint venture (JV) partner Noble Energy Inc. and itself drill 76 wells into the Marcellus in Central and Southwest Pennsylvania, as well as Northern West Virginia this year. Noble is expected to drill 85 wells in the Marcellus this year under the partnership.

On Tuesday, the company said its capital expenditures budget would remain flat this year (see Shale Daily, Jan. 21), issuing gas-weighted production guidance at 215-235 Bcfe. Consol said 107-109 Bcfe could be produced in the Marcellus in 2014.

Overall, Consol reported producing 172.4 Bcfe, net to the company, last year. In 4Q2013, Consol said it extracted 41.8 Bcfe for an increase of 16% from the same time a year earlier.

“Despite the potential for distractions during a quarter with a major asset transaction, Consol Energy’s gas operations and mines performed with distinction,” said CEO J. Brett Harvey. “In natural gas, we again set quarterly and annual production records, while positioning ourselves to accelerate production growth in 2014.”

Consol expects to spend about $1.1 billion on development in the Marcellus and Utica this year. The company has made a point to divest some of its coal assets in recent years in order to focus on gas production in the Appalachian Basin (see Shale Daily, Oct. 28, 2013).

Like other operators in the region, Consol has worked to reduce its well costs. On Friday, the company said drilling and completion costs for a 6,000 foot lateral drilled last year were $6.7 million, including the cost of wells drilled utilizing short stage lengths and reduced cluster spacing.

Although the advanced techniques add about $1.2 million to each well when they are applied, the company said, shorter lengths and reduced cluster spacing are expected to increase estimated ultimate recovery (EUR) by 15-20% in the Marcellus. Early results from the techniques in Southwest Pennsylvania showed initial production rates in the fourth quarter that were as high as 18 MMcf/d, with an average of 12 MMcf/d for the wells brought online using the techniques.

Consol said it plans on using shorter lengths and reduced spacing in its landmark project at the Pittsburgh International Airport (see Shale Daily, Feb. 12, 2013) in an area where other operators have reported solid wet-gas production.

Consol’s closely watched Upper Devonian well (see Shale Daily, July 29, 2013), drilled in the Burkett Shale and turned in line in June, continues to demonstrate a shallow decline rate and an EUR in the range of 5-6 Bcfe. The company said it will drill five additional wells in the Burkett this year and another in the Rhinestreet Shale formation.

In Ohio’s Utica Shale, Consol drilled nine wells last year with average lateral lengths ranging from 4,834-10,360 feet, all in Noble County in the southeast part of the state. Under the companies JV with Hess Corp., Consol has said it plans to drill 32 wells in the Utica this year. The company said Tuesday that it will drill 14 wells itself in Noble and Monroe counties this year.

The company is not currently operating a horizontal rig in the Utica but has plans to add one late in the first quarter.