Antero Resources Operations and Firm Transportation Update



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-- WITH PHOTO -- TO BUSINESS, AND ENERGY EDITORS:

Antero Resources Operations and Firm Transportation Update

DENVER, April 14, 2014 /PRNewswire/ --

-- First quarter 2014 average net daily gas equivalent production is

estimated to be 783 to 787 MMcfe/d, a 105% increase over the prior

year quarter and 16% sequentially

-- First quarter 2014 average net daily liquids production is

estimated to be 16,000 to 16,500 Bbl/d, a 580% increase over the prior

year quarter and 45% sequentially

-- First quarter 2014 average realized natural gas price before

hedging is estimated to be $5.02 to $5.06 per Mcf, an approximate

$0.08 to $0.12 premium to NYMEX after Btu upgrade; average natural gas

equivalent price including NGLs, oil and hedges is estimated to be

$5.76 to $5.80 per Mcfe, a 10% increase compared to the first quarter

of 2013

-- First 15 Marcellus Shale wells with shorter stage length (SSL)

completions had an average 180-day production rate of 8.1 MMcfe/d, 25%

above the Company's non-SSL reserve report type curve

-- Latest 9 Utica Shale wells had an average 30-day production rate of

15.3 MMcfe/d in ethane rejection (50% liquids)

-- Utica Condensate and Highly-Rich Gas/Condensate type curves and

regimes were revised downward based on recent unconstrained production

history

-- Second Utica compressor station was recently placed in service,

resulting in a combined 240 MMcf/d of Antero-committed compression

capacity in Ohio

-- Firm transportation and firm gas sales were increased to an average

2.6 Bcf/d in 2016 (assuming 1,000 Btu gas)

-- Entered into an agreement to be the anchor supplier to the planned

Ascent ethane cracker project in West Virginia with 30,000 Bbl/d

ethane commitment

-- Entered into an agreement to be the anchor shipper on the proposed

Mariner East II pipeline and export project in Pennsylvania with

51,500 Bbl/d NGL commitment

Antero Resources (NYSE: AR) ("Antero" or the "Company") announced

today recent operational highlights and an increase in its firm

transportation position.

Operating Update

All operational figures are as of the date of this release unless

otherwise noted.

Antero's net daily production for the first quarter of 2014 is

estimated to average 783 to 787 MMcfe/d, including 16,000 to 16,500

Bbl/d of liquids (12% liquids). The midpoint of the first quarter

2014 estimated production represents an organic production growth rate

of 16% and 105% from the fourth quarter of 2013 and first quarter of

2013, respectively, despite severe winter weather and challenging

operating conditions during the quarter. The midpoint of the first

quarter 2014 estimated liquids production represents an organic

production growth rate of 45% and 580% from the fourth quarter of 2013

and first quarter of 2013, respectively. The Company has completed a

combined 266 horizontal wells in the Marcellus Shale and Utica Shale

since commencing drilling operations in Appalachia in 2009.

Antero's average realized natural gas price before hedging for the

first quarter of 2014 is estimated to be $5.02 to $5.06 per Mcf, a 2%

premium to the NYMEX average for the period. Approximately 45% of

Antero's first quarter 2014 natural gas revenue was realized at the

Columbia Gas Transmission (TCO) index and the remaining natural gas

revenue was realized at various other index pricing points including

Dominion South, TETCO M2 and NYMEX. The midpoint of the estimated

realized gas price before hedging represents a $0.10 premium to NYMEX,

at the high end of the Company's 2014 guidance of a $0.00 to $0.10

premium.

Antero's average realized Y-grade C3+ NGL price for the first quarter

of 2014 is estimated to be $60.00 to $62.00 per barrel, or an average

of approximately 62% of the NYMEX WTI oil price average for the

period, and the average realized oil price is estimated to be $87.00

to $89.00 per barrel. Average natural gas equivalent price including

NGLs and oil, but excluding hedge settlements, is estimated to be

$5.78 to $5.82 per Mcfe.

Antero's average realized natural gas price for the first quarter of

2014 including hedges is estimated to be $5.00 to $5.04 per Mcf, a

decrease of approximately 2% as compared to the first quarter of

2013. Average natural gas equivalent price including NGLs, oil and

hedge settlements is estimated to be $5.76 to $5.80 per Mcfe, an

increase of approximately 10% as compared to the first quarter of 2013

due to the significant increase in liquids production. For the first

quarter of 2014, Antero realized estimated hedging losses of

approximately $1.1 million, or $0.02 per Mcf, due to the sharp rise in

natural gas prices this past winter.

Commenting on Antero's estimated first quarter 2014 results and firm

transportation update, Paul Rady, Antero's Chairman of the Board and

CEO, said, "Our estimated first quarter results demonstrate Antero's

positive momentum and high growth profile with over 100% production

growth compared to the prior year quarter. Additionally, our

forward-looking integrated strategy has resulted in the accumulation

of an extensive portfolio of firm takeaway capacity and firm sales

both for natural gas and NGLs. This portfolio results in diversified

exposure to index prices in Appalachia, the Midwest and the Gulf

Coast. It also gives Antero the ability to sustain high growth well

into the future. The midpoint of our 2014 guidance targets 80%

production growth compared to the prior year. Additionally, now that

we have incremental firm transportation capacity in hand, we are

targeting compound annual growth in net production of 45% to 50% in

2015 and 2016."

Marcellus Shale - Antero utilized shorter stage length completions on

all of its Marcellus wells during the first quarter of 2014. Antero

continues to be encouraged by its SSL well results. To date, the

Company has completed and placed on line 38 Marcellus wells utilizing

SSL completions that have at least 30 days of production history.

The various actual average production rates are compared to the

non-SSL reserve report type curve in the table below:

SSL vs Non-SSL Average Rate Comparison (MMcfe/d)

30-day rate 90-day rate 180-day rate

SSL Well Count 38 23 15

SSL Average Rate - MMcfe/d 11.3 9.0 8.1

1.5 Bcf/1,000' Type Curve Average Rate - MMcfe/d 8.7 7.5 6.5

SSL % Rate Improvement 30% 20% 25%

The 15 wells that have been on line for at least 180 days are 25%

above Antero's 1.5 Bcf per 1,000 feet of lateral non-SSL type curve.

The average well cost for an SSL well, defined as a well with stage

lengths less than 225 feet, is approximately 10% to 15% higher than a

comparable non-SSL well with an average stage length of 350 feet.

Antero is currently operating 15 drilling rigs in the Marcellus Shale

play. The Company has 79 gross (75 net) horizontal wells either in

the process of drilling, completing or waiting on completion in the

Marcellus. Antero currently has three dedicated frac crews and five

spot frac crews working in West Virginia.

During the first quarter of 2014, Antero added approximately 9,000 net

acres and currently holds approximately 354,000 net acres in the

southwestern core of the Marcellus play. Approximately 27% of this

net acreage was associated with proved reserves and approximately 8%

with proved developed producing reserves at year-end 2013.

Additionally, approximately 70% of the leasehold is prospective for

processable rich gas assuming an 1100 Btu cutoff.

Marcellus Processing Update

Antero currently has access to a total of 600 MMcf/d of cryogenic

processing capacity at the MarkWest Sherwood processing facility

located in Doddridge County, West Virginia. Antero has committed to

three additional 200 MMcf/d cryogenic processing plants, Sherwood IV,

V and VI. Sherwood IV is expected to go on line in the third quarter

of 2014, Sherwood V is expected to go on line in the fourth quarter of

2014, and Sherwood VI is expected to go on line in the second quarter

of 2015. These commitments provide Antero access to a total of 1.2

Bcf/d of Marcellus cryogenic processing capacity. Ethane is currently

being rejected at the processing facility and left in the gas stream.

Utica Shale - Since the fourth quarter operations update on January

27, 2014, the Company has completed and placed on line nine additional

wells in the Utica that have at least 30 days of production history.

Eight of the nine additional wells are located in the 1250 to 1300 Btu

regime and had an average 30-day production rate (in ethane rejection)

of 14.8 MMcfe/d (52% liquids), representing a 58% improvement over the

average 30-day production rate of the five previously disclosed wells

in the same Btu regime of 9.4 MMcfe/d (36% liquids). One of the nine

additional wells is located in the new 1225 to 1250 Btu regime and had

a 30-day production rate (in ethane rejection) of 19.0 MMcfe/d (36%

liquids), representing a 36% improvement over the 30-day production

rate of the one previously disclosed well in the same Btu regime of

14.0 MMcfe/d (23% liquids).

Antero is currently operating 5 drilling rigs in the Utica Shale

play. The Company has 18 gross (13 net) horizontal wells either in

the process of drilling, completing or waiting on completion. Antero

currently has one full time dedicated frac crew and one spot crew

working in Ohio.

During the first quarter of 2014, Antero added approximately 3,000 net

acres and currently holds approximately 108,000 net acres in the core

of the Utica Shale play. Approximately 6% of this net acreage was

associated with proved reserves and approximately 3% with proved

developed producing reserves at year-end 2013. Additionally,

approximately 75% of the leasehold is prospective for processable rich

gas assuming an 1100 Btu cutoff.

Utica Type Curve Revisions and New Regime Delineation

As Antero has further delineated its Utica position, the Company has

divided its acreage into five different type curve regimes, based on

Btu content and estimated ultimate recoveries (EURs). This compares

to the previous methodology in which Antero divided its acreage into

four different type curve regimes. Based on additional production

history, Antero has divided the Highly-Rich Gas/Condensate regime,

previously spanning the 1250 to 1300 Btu range, and the Highly-Rich

Gas regime, previously spanning the 1200 to 1250 Btu range, into three

regimes instead of two. The new regimes are defined as Condensate

(1250 to 1300 Btu), Highly-Rich Gas/Condensate (1225 to 1250 Btu) and

Highly-Rich Gas (1200 to 1225 Btu).

The EUR/1,000' of lateral assumption has been adjusted downward by 31%

to 1.1 Bcfe/1,000' in the Condensate regime to reflect lower expected

recoveries of condensate and rich gas based on several months of

relatively unconstrained production. Early in the first quarter of

2014, Antero gained access to the first 120 MMcf/d of third-party

operated compression. This compression allowed for normal operating

pressure and unconstrained production history. The EUR assumption in

the new Highly-Rich Gas/Condensate regime is 1.9 Bcfe/1,000' or 34%

below the previous assumption for this area which was previously a

subset of the Highly-Rich Gas regime. This regime is considered a

transition zone between the Highly-Rich Gas regime and the Condensate

regime. While the Company has seen some encouraging early results,

there is still uncertainty regarding EURs in the Highly-Rich

Gas/Condensate regime due to limited well population and limited

production history. The Company has undertaken several initiatives in

order to improve the ultimate recovery of wells located in the

Condensate and the Highly-Rich Gas/Condensate regimes, including

shorter stage lengths, restricted choke pilots and artificial lift

measures.

There are no material changes to the Highly-Rich Gas (1200 to 1225

Btu), the Rich Gas (1100 to 1200 Btu) or the Dry Gas (less than 1100

Btu) regimes. Please refer to page 24 of the April Company

Presentation on Antero's website for revised Utica well assumptions at

www.anteroresources.com. The new EUR regime assumptions are

summarized below.

EUR Regime Condensate Highly-Rich Gas/Condensate Highly-Rich Gas Rich Gas Dry Gas

Btu Range 1250-1300 1225-1250 1200-1225 1100-1200 <1100

EUR (Bcfe): 7.4 13.3 19.9 18.5 16.6

EUR (MMboe): 1.2 2.2 3.3 3.1 2.8

% Liquids: 35% 26% 21% 14% 0%

Lateral Length (ft): 7,000 7,000 7,000 7,000 7,000

Stage Length (ft): 240 240 240 240 240

Well Cost ($MM): $11.0 $11.0 $11.0 $11.0 $11.0

Bcfe/1,000': 1.1 1.9 2.8 2.6 2.4

Gross Locations (Undeveloped): 193 75 91 180 211

Commenting on the Utica Shale, Glen Warren, President and CFO, said

"The downward type curve revision in our Condensate and Highly-Rich

Gas/Condensate regimes affects 268 or approximately 6% of our total

4,843 gross undrilled 3P locations. We have maintained since our

first Utica completions that EURs in the condensate heavy areas would

be less predictable than rich gas and dry gas areas due to retrograde

condensate challenges. Because the Condensate and Highly-Rich

Gas/Condensate regimes provide Antero with significant exposure to

wellhead condensate and highly-rich processable gas, we plan to

continue developing these areas as we adjust completions and apply

various production enhancement measures. We are seeing improvement in

30-day rates in the condensate heavy areas but we need more production

history to judge whether these improved results are sustainable. "

Utica Compression Update

A second third party owned and operated compression and condensate

stabilization facility was recently placed in service resulting in

total Antero-dedicated compression capacity of 240 MMcf/d and total

condensate stabilization capacity of 11,000 Bbl/d. A third

compression station and condensate stabilization facility is expected

to start up in the third quarter of 2014. Antero continues to lay

both low-pressure and high-pressure gathering pipelines to connect the

wells to compression and transport its production to the MarkWest

Seneca processing complex.

Firm Transportation and Firm Sales

Antero has entered into firm transportation agreements with various

pipelines and firm sales agreements with various counterparties who

hold firm transportation capacity in order to facilitate the delivery

of its production to preferred markets and diversify its exposure to

basis concentration risk. The firm transportation agreements

generally have a term of ten to thirty years and include fixed and

variable cost components referred to as demand and commodity charges,

respectively. The firm sales agreements are sales to other firm

shippers, are typically two to five years in term, are settled on an

agreed-to price based on a local index, and do not involve demand or

commodity charges.

Natural Gas

On April 14, 2014, Kinder Morgan Energy Partners, L.P. announced that

KMP unit Tennessee Gas Pipeline Company ("TGP") awarded Antero

Resources 100% of the capacity offered in TGP's binding open season

for its proposed Broad Run Flexibility ("BRF") and Broad Run Expansion

("BRE") Projects located in West Virginia. The BRF Project provides

590,000 MMBtu/d of firm transportation capacity from TGP's Broad Run

Lateral in TGP Zone 3 to delivery points along the Gulf Coast. The

anticipated in service date of the BRF Project is November 1, 2015.

The BRE Project provides an additional 200,000 MMBtu/d of firm

transportation capacity on the same capacity path to the Gulf Coast.

The anticipated in service date of the BRE Project is November 1,

2017. The term of this agreement is 15 years and provides Antero with

the ability to access Gulf Coast pricing hubs as well as international

LNG markets.

Further, Antero successfully bid on an additional 600,000 MMBtu/d of

firm gas transportation directed to the Gulf Coast. The primary

delivery point for this firm transportation capacity is located near

growing Gulf Coast petrochemical demand and the future LNG export

corridor. In the near term, this new firm capacity gives Antero the

option to redirect gas from its Midwest-directed capacity to Gulf

Coast pricing when commodity prices are more favorable than Midwest

pricing. Should Antero elect not to redirect this gas, this firm

capacity will likely be utilized as release capacity to transport

third party gas out of the constrained Northeast area offsetting

Antero's firm transportation costs associated with this capacity. In

the longer term, Antero ultimately expects to link to this capacity by

committing volumes either to existing east to west pipelines or

support a new-build project connecting Antero's Utica Shale to this

new firm transportation. In the latter case, the 600,000 MMBtu/d of

firm transportation will be incremental to Antero's firm

transportation portfolio from the Utica Shale to the Gulf Coast.

Below is a summary schedule of Antero's average annual firm

transportation and sales volumes for each of the years presented.

2014 - Average 2015 - Average 2016 - Average

MMbtu/d MMbtu/d MMbtu/d Pricing Region

Firm Transportation

Columbia 403,000 595,000 582,000 Appalachia or Gulf Coast

REX/Other 306,000 600,000 600,000 Midwest or Gulf Coast

Tennessee - 100,000 590,000 Gulf Coast

Other Regional 395,000 615,000 625,000 Appalachia

Firm Sales 250,000 240,000 223,000 Appalachia, NYMEX

Total Firm Commitments 1,354,000 2,150,000 2,620,000

By 2016, the above firm transportation portfolio provides Antero the

ability to direct 49% of its production to the Gulf Coast, 28% to

Appalachia and 23% to Midwest pricing, including Chicago and Detroit.

Antero's all-in average firm transportation and firm sales cost per

MMbtu assuming full utilization, including both demand and commodity

charges, is $0.31, $0.32 and $0.42 for 2014, 2015 and 2016,

respectively. The firm transportation portfolio, based on current

futures pricing and differentials, would result in an approximate

$0.15 per MMbtu basis differential improvement in its 2016 realized

prices compared to 2014 realized prices.

NGLs

On March 26, 2014, Antero signed an agreement to become the anchor

supplier for the planned Ascent petrochemical complex to be located

near Parkersburg, West Virginia. Under the agreement, Antero intends

to provide 30,000 Bbl/d of ethane which represents almost half of the

volume required to operate the Ascent ethane cracker. This agreement

is contingent upon Ascent reaching a final investment decision once

the multi-year feasibility analysis is completed and a construction

decision has been made.

Antero recently committed to a 10 year transport, terminal and storage

agreement with Sunoco Logistics Partners LP (NYSE: SXL) on its Mariner

East II Project. Subject to the outcome of the binding open season

currently underway and all of the necessary regulatory approvals, the

Mariner East II pipeline and export project will connect the NGL

resources in the Marcellus and Utica Shale to Sunoco's existing

infrastructure and international port at its Marcus Hook facility near

Philadelphia. Mariner East II is expected to be operational in early

2016. Under the agreement, Antero will be an anchor shipper and have

firm transportation of 51,500 barrels per day (11,500 barrels of

ethane, 28,000 barrels of propane and 12,000 barrels of butane).

Antero will have the ability, through the Marcus Hook facility, to

market ethane, propane and butane to local markets in the Northeast as

well as export product to international markets. These markets are

currently paying a premium price relative to Appalachian prices.

Subject to the finalization of the agreements above, combined with the

Company's previously reported 20,000 Bbl/d firm transportation

contract on the ATEX pipeline, Antero will have access to 101,500

barrels per day of NGL takeaway capacity. This capacity is comprised

of 61,500 barrels per day of ethane takeaway, 28,000 barrels per day

of propane takeaway and 12,000 barrels per day of butane takeaway to

diversified markets both domestic and international.

Capital Spending

Antero's total capital expenditures for the three months ended March

31, 2014 are estimated to be $725 million to $745 million, including

drilling and completion costs of $490 million to $495 million,

gathering and compression costs of $110 million to $115 million, fresh

water distribution project costs of $57.5 million to $62.5 million,

leasehold acquisition costs of $57.5 million to $62.5 million and

approximately $10 million on other capital expenditures. During the

quarter, due to the success of Antero's infill acreage leasing

efforts, average drilled lateral length compared to budget increased

2%. The successful acreage adds also had the effect of increasing the

average working interest on wells drilled during the quarter from the

budgeted 95% to 97%.

Antero has increased its 2014 capital budget by $150 million to $2.75

billion. The budget has been increased for additional gathering and

compression projects to be built by the Company including two

compressor stations in the Utica Shale as well as one compressor

station and a 15 mile high pressure gathering line accessing rich gas

production in the Marcellus Shale. The additional compression and

gathering assets will be included in the contemplated master limited

partnership offering involving Antero's midstream assets.

Antero Resources is an independent oil and natural gas company engaged

in the acquisition, development and production of unconventional oil

and liquids-rich natural gas properties located in the Appalachian

Basin in West Virginia, Ohio and Pennsylvania. The Company's website

is located at www.anteroresources.com .

This release includes "forward-looking statements". Such

forward-looking statements are subject to a number of risks and

uncertainties, many of which are beyond Antero's control. All

statements, other than historical facts included in this release, are

forward-looking statements. All forward-looking statements speak only

as of the date of this release. Although Antero believes that the

plans, intentions and expectations reflected in or suggested by the

forward-looking statements are reasonable, there is no assurance that

these plans, intentions or expectations will be achieved. Therefore,

actual outcomes and results could materially differ from what is

expressed, implied or forecast in such statements.

Antero cautions you that these forward-looking statements are subject

to all of the risks and uncertainties, most of which are difficult to

predict and many of which are beyond the Company's control, incident

to the exploration for and development, production, gathering and sale

of natural gas, NGLs and oil. These risks include, but are not limited

to, commodity price volatility, inflation, lack of availability of

drilling and production equipment and services, environmental risks,

drilling and other operating risks, regulatory changes, the

uncertainty inherent in estimating natural gas and oil reserves and in

projecting future rates of production, cash flow and access to

capital, the timing of development expenditures, and the other risks

described under the heading "Item 1A. Risk Factors" in Antero's Annual

Report on Form 10-K for the year ended December 31, 2013.

Logo - http://photos.prnewswire.com/prnh/20131101/LA09101LOGO

SOURCE Antero Resources

-0- 04/14/2014

/CONTACT: For more information, contact Michael Kennedy - VP Finance, at (303) 357-6782 or mkennedy@anteroresources.com.

/Photo: http://photos.prnewswire.com/prnh/20131101/LA09101LOGO

/Web Site: http://www.anteroresources.com

(NYSE:AR /

NYSE:SXL) /

CO: Antero Resources

ST: Colorado

IN: OIL UTI GAS

SU: ERP

PRN

-- LA04331 --

0000 04/14/2014 12:30:00 EDT http://www.prnewswire.com

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