Gulfport Energy Corp. officials have reaffirmed the company’s commitment to the Utica Shale, unveiling details of an accelerated, but cheaper, drilling plan coordinated with the construction of much-needed infrastructure in the play.

“I’d like to reiterate again that the Utica is our primary go-forward focus, and we are allocating our capital accordingly,” CEO Jim Palm said Feb. 27 during an conference call to discuss results for 4Q2012 and full-year 2012. “In the Utica, we’ve identified a high-return opportunity that has an enhanced value if we develop at a faster pace than current levels of activity.”

Palm said the Oklahoma City-based company planned to keep three horizontal drilling rigs and two top hole rigs running in the Utica, and was in the process of contracting a fourth horizontal rig to begin work in April. He said Goodrich would save at least $25,000 per day by using top hole rigs to drill the vertical section of each well.

According to Palm, Gulfport spudded 14 gross wells in the Utica in 2012, with two wells producing. Eight wells were completed and in their resting period, two wells were waiting on completion and two wells were being drilled at the end of the year.

Gulfport’s plans in the Utica are dovetailing with those of MarkWest Utica EMG LLC, a joint venture (JV) of MarkWest Energy Partners LP and The Energy and Minerals Group. The JV is developing an integrated system in the Utica to provide low- and high-pressure natural gas gathering systems, natural gas liquids pipelines and processing complexes that would have nearly 800 MMcf/d of capacity and provide 100,000 b/d of C2+ fractionation capacity.

Palm said Gulfport plans to drill 50 gross wells in the Utica in 2013, “but we just ramped up our drilling rig count earlier, giving us a head start if we decide to accelerate drilling later in the year.” Last month the company said it planned to have 11 horizontal wells online by June.

Gulfport announced on Feb. 11 that it had entered into an agreement with Windsor Ohio LLC, an affiliate of Wexford Capital LP, to buy approximately 22,000 net acres in the Utica in eastern Ohio for about $220 million (see NGI, Feb. 18). The deal was to close at the end of February, increasing Gulfport’s working interest to 93.8% and boosting its position in the Utica to 137,000 gross (128,000 net) acres.

CFO Michael Moore said the company planned to spend between $458 million and $512 million on capital expenditures in 2013. He said lease operating expenses ($5 to $6/boe), general and administrative costs ($1.50 to $2.50/boe), and depreciation, depletion and amortization expenses ($33 to $35/boe) would all remain unchanged from 2012.

Moore said Gulfport is anticipating that its production during 1Q2013 will be relatively flat compared to the preceding quarter, and remain in the 6,800 to 7,200 boe/d range due to the infrastructure constraints. He added that the company had “more confidence” in its production guidance for 2013 because MarkWest was close to hooking up the wells Goodrich drilled in 2012.

Gulfport reported 4Q2012 total production of 6.6 Bcfe (71,800 Mcfe/d), compared to 10.0 Bcfe (108,200 Mcfe/d) during 4Q2011, with natural gas production of 4.6 Bcf (50,300 Mcf/d) and oil production of 329,000 bbl (3,600 b/d). Production for the full-year 2012 totaled 1.1 million bbl of oil, a 70% increase over 2011, and 24.8 Bcf of natural gas.

For 4Q2012, net income was $15.9 million (28 cents/share), down 47.8% from $31 million during the preceding fourth quarter. Net income for 2012 totaled $68.4 million ($1.21/share), down 36.9% from 2011’s $108.4 million. Revenues in 4Q2012 were $48.2 million, compared with $51.4 million for 4Q2011. Full-year revenues for 2012 totaled $180.8 million, a decrease from the $201.1 million earned in 2011.

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