Cabot Oil & Gas Corp. continues to find drilling success in the Marcellus, Eagle Ford and Marmaton shale plays, and has doubled liquids production and increased natural gas production 37% since 3Q2010, the company said.

“Our production volumes landed at the midpoint of guidance even with all the noise during the quarter surrounding takeaway capacities, weather and project delays,” CEO Dan Dinges said during a 3Q2011 earnings conference call with analysts Thursday. Cabot expects to grow production 40-46% net of asset sales this year and 45-55% next year, and to increase its reserves more than 10% in each year. All of that growth is being driven by a total rig count of seven, “which I think indicates the prolific nature of our portfolio,” Dinges said.

In the Marcellus, Cabot achieved a 24-hour production record of 517 MMcf/d from 94 horizontal wells in Susquehanna County, PA, and claims to have 16 of the top 20 production wells in Pennsylvania’s Marcellus during the first six months of 2011. Cabot is also improving operational efficiency in the Marcellus, reporting one horizontal well with a 3,500-foot lateral reaching total depth in just 12.5 days. Cabot turned-in-line 17 horizontal wells in 3Q2011, all of which are producing at curtailed rates pending new infrastructure commissioning, Dinges said.

“All told, we have 30 wells with cumulative production of more than 2.0 Bcf each, and of note, our two extended lateral wells have cumulative production of more than 2.8 Bcf each in about 150 days,” Dinges said.

Cabot has begun moving gas on Millennium and the new Laser pipeline and expects to begin moving gas to Transcontinental Gas Pipe Line (Transco) via the new Springville pipeline in mid-December. The company recently secured 100% of the remaining capacity of the Springville Pipeline, which will allow it to move up to 625 MMcf/d (an incremental 325 MMcf/d) to Transco by the middle of 2012.

“This additional capacity will be available mid-2012,” Dinges said.”With this as a backdrop, the majority of our 2012 production will be going to markets not currently served by Cabot. We think this is an improvement.”

Last month the producer said its published 3Q2011 guidance of 521-567 MMcfe/d had not been affected by “recent operational challenges and the logistics of moving gas in northeast Pennsylvania” (see Shale Daily, Sept. 19). But with delays in moving gas on Laser and Transco and gas-on-gas competition from the surrounding area, “recent pricing for northeast Marcellus producers has seen downward pressure,” Cabot said Thursday.

In the Eagle Ford Shale, Cabot increased activity in the Buckhorn area during 3Q2011, with nine more wells completed and a total of 21 producing wells. The average lateral length for all wells at Buckhorn is approximately 5,000 feet with an average of 16 hydraulically fractured stages.

Cabot continues to report success in the Marmaton oil shale in the Texas and Oklahoma Panhandles, where it controls more than 61,000 acres and has participated as a nonoperator in seven wells.

“Presently, we are moving an operated rig to the area in anticipation of having one rig there for 2012, in addition to one in the Eagle Ford,” Dinges said.

Earlier this year Cabot sold all of its assets in Wyoming, Colorado and Utah to focus on Appalachia and the Midcontinent (see Shale Daily, July 29).

Houston-based Cabot reported 3Q2011 net income of $28.5 million (27 cents/share) compared with $3.9 million (4 cents/share) in 3Q2010. Increased production drove the quarter’s overall improvement, though it was partially offset by lower commodity prices. Natural gas realized prices fell 17% compared with 3Q2010 and oil prices fell almost 12%.

Included in the “noise” Cabot was able to overcome in 3Q2011 was an extended legal battle over methane migration problems near Dimock Township, PA. Last week the Pennsylvania Department of Environmental Protection granted Cabot permission to discontinue by Nov. 30 potable water deliveries to several Dimock residents (see Shale Daily, Oct. 20).