Range Announces Updated 2015 Capital Budget, Early Commissioning of Mariner East Propane Pipeline and 2014 Production Volumes
- 2015 Capital expenditure budget revised to
$870 million targeting production growth of 20% year-over-year - Mariner East propane pipeline commissioned with propane line fill in late December
- 2014 year-over-year production growth approximately 24%
- New ethane sales contract announced for 2015
In December, Range announced a planned 2015 capital budget of
Range confirmed the Mariner East propane pipeline was commissioned earlier than expected during the last few weeks of December. While full capacity operation has not commenced, the propane line fill has been completed and propane is being delivered to storage caverns for further sale. Range has delivered its share (80%) of approximately 133,000 barrels of propane line fill into the pipeline while the operator completes work at the
Commissioning of the pipeline was originally expected to occur during the first quarter of 2015. Early commissioning reduced Range's propane production for the fourth quarter of 2014 because propane used as line fill is accounted for as inventory, not as sales. When the propane is taken out of inventory and sold, production is then recognized. Once the Mariner East pipeline is converted to transport both propane and ethane later in 2015, the Company expects that a portion of the propane line fill inventory could be available for sale with production recognized at that time.
Although year-end audited financial amounts are not complete, Range expects that its total production growth for 2014 will approximate 24% with estimated production for the year of 1.16 Bcfe per day. Fourth quarter production volumes were approximately 1.27 Bcfe per day with 31% liquids. The fourth quarter production varied from guidance as a result of the early propane line fill and operational flow on Mariner West in November and December. In addition, construction delays on several compressor start-ups scheduled for late in the quarter pushed approximately 80 Mmcfe per day of fourth quarter production to the first quarter of 2015. All the compressors are currently in various stages of installation with the last compressor expected to be online by the end of February. Range currently expects no further delays in building compressor stations scheduled for 2015.
Range also announced that the Company entered into a multi-year contract to sell ethane through the ATEX pipeline for 5,000 barrels per day, representing half of its existing committed transportation volume. Commencing
Commenting on the announcements,
"Our prior planning gives us the needed takeaway capacity, marketing contracts and infrastructure development for our future. One of those infrastructure plans is the Mariner East pipeline project. We are excited to see the initial startup of Mariner East. This is great news for Range and great news for
All statements, except for statements of historical fact, made in this release such as expected increased price realizations, expected future contracts, expected future infrastructure expansions, expected production volumes subject to audit, expected timing of propane sales and continued growth are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements are based on assumptions and estimates that management believes are reasonable based on currently available information; however, management's assumptions and Range's future performance are subject to a wide range of business risks and uncertainties and there is no assurance that these goals and projections can or will be met. Any number of factors could cause actual results to differ materially from those in the forward-looking statements, including, but not limited to, the volatility of oil and gas prices, the results of our hedging transactions, the costs and results of drilling and operations, the timing of production, mechanical and other inherent risks associated with oil and gas production, weather, the availability of drilling equipment, changes in interest rates, litigation, uncertainties about reserve estimates, environmental risks and regulatory changes. Range undertakes no obligation to publicly update or revise any forward-looking statements. Further information on risks and uncertainties is available in Range's filings with the
Range Investor Contacts:
Senior Vice President
817-869-4258
rwaller@rangeresources.com
Investor Relations Manager
817-869-4266
damend@rangeresources.com
Research Manager
817-869-4267
lsando@rangeresources.com
Senior Financial Analyst
817-869-4264
mfreeman@rangeresources.com
or
Range Media Contact:
Director of Corporate Communications
724-873-3224
mpitzarella@rangeresources.com
www.rangeresources.com
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