Range Resources Corp. is decreasing its 2015 capital spending budget to $1.3 billion, down 18 percent from 2014, but the Fort Worth-based energy firm still expects to deliver year-over-year production increases in the 20 to 25 percent range, citing new efficiencies in its Marcellus shale projects.
The company announced the capital spending information this morning, along with news that its board of directors has named Jeff Ventura chairman of the board of directors effective Jan. 1, 2015. Ventura will replace John Pinkerton, who has served as the company’s chairman since 2008. Ventura will continue to serve as the company’s president and CEO, while Pinkerton will continue to serve as a director. Mr. V. Richard Eales will continue to serve as the company’s lead independent director.
“Jeff has been instrumental in leading Range since becoming CEO in 2012. Jeff’s strong technical and business skills, coupled with his commitment and integrity, make him an excellent choice to become Range’s next chairman,” said Pinkerton. “I look forward to working with Jeff in his new role as we all continue to focus on building value for Range’s shareholders.” The 2015 capital budget includes approximately $1.1 million for drilling and recompletions, $155 million for leasehold and renewals, $55 million for pipeline tie-ins and facilities and $25 million for seismic and other activities. By division, the 2015 capital budget is heavily focused on the Marcellus shale, which will have approximately 92 percent of the budget. Southern Appalachia and Midcontinent will have 4 percent respectively.
Range plans to increase the lateral lengths and the number of frac stages for its 2015 Marcellus wells to average 6,200 feet with 31 frac stages, or approximately 200 feet between stages. The laterals for a third of the 2015 wells are expected to be over 7,000 feet as the company continues to optimize its well designs, the company said. U.S. oil drillers last week idled the most rigs in almost two years as crude tumbled below $60 a barrel. Producers including ConocoPhillips and BP have curbed spending, and the number of rigs is declining from a record 1,609, threatening to slow the shale-drilling boom that has propelled U.S. production to the highest level in three decades.- Robert Francis, firstname.lastname@example.org This report includes material from The Washington Post/Bloomberg