Rex Energy Corporation announced initial production results from its first Ohio Utica Shale well and provided an update on its operations.
The Brace #1H, located in Carroll County, Ohio, was brought online to sales from its 60-day resting period at a 24-hour sales rate, assuming full ethane recovery, of 1,094 Boe/d (43% NGLs, 31% gas, 26% condensate). The well went on to average a 5-day sales rate, assuming full ethane recovery, of 1,008 Boe/d (43% NGLs, 30% gas, 27% condensate). The well produced with an average casing pressure of 1,502 psi during the initial 24-hour sales period and 1,533 psi during the average 5-day sales period on a 24/64 inch choke. The well was drilled to a total measured depth of 12,332 feet with a lateral length of approximately 4,170 feet and was completed in 17 stages. Based on composition analysis, the oil from the Brace #1H is 60.1 degree API gravity and the gas is approximately 1,250 BTU.
Brace #1H Results (Boe/d) 24-hour sales rate with 336 Natural Gas, 291Condensate, 467 NGLs, 1,094 Total (Full Ethane Recovery), 69% Percentage of Liquids (Full Ethane Recovery) and 911 Total (Ethane Rejection Mode).
Brace #1H Results (Boe/d) 5-day sales rate with 306 Natural Gas, 273 Condensate, 429 NGLs, 1,008 Total (Full Ethane Recovery), 70% Percentage of Liquids (Full Ethane Recovery) and 839 Total (Ethane Rejection Mode).
"We are pleased with the results of our first Ohio Utica Shale well, the Brace #1H," commented Tom Stabley, Rex Energy's Chief Executive Officer. "We believe that the initial sales from the well on a per lateral foot basis are among the best results in Carroll County to date."
Rex Energy has approximately 15,400 net acres in Carroll County, Ohio, which is referred to by the company as its Warrior Prospect. The company's preliminary 2013 plans are to drill an additional nine wells and complete six wells in its Warrior Prospect.
In the Warrior South Prospect, located in Noble, Guernsey and Belmont Counties, Ohio, where Rex Energy holds 3,100 net acres, the company has drilled and cased its first well, the Guernsey #1H. The company is currently drilling the second of its three planned wells, the Noble #1H, and expects to drill all three planned wells by the end of 2012. The company's preliminary 2013 plans are to drill an additional three wells and complete three wells in its Warrior South Prospect.
As part of its focus on growing liquids production, the company is continuing its previously announced conventional drilling and re-completion program in Gibson and Posey Counties, Indiana. The company now expects that results from this program will exceed the high end of the previously announced incremental oil production of 250 — 400 gross BOPD by the end of 2012.
As previously reported, Rex Energy experienced extended commissioning and de-propanizer maintenance issues at the MarkWest operated Bluestone/Sarsen cryogenic gas processing complex in Butler County, Pennsylvania. The work required to correct these issues caused approximately 2.4 MMcfe/d of downtime and processing constraints during the months of July, August and the first 23 days in September. The bulk of the maintenance work is complete and the company has been informed by its midstream provider that it expects the facility to resume normal operations by the end of September. In addition, the company is deferring some of its previously forecasted 2012 production in order to test the effects of increased shut-in periods and restricted flow rates in its Butler Operated Area. As a result of these factors, third quarter average daily production is now expected to range from 70-72 MMcfe/d, which is slightly lower than the previous guidance of 73-76 MMcfe/d. Guidance for the full year has been similarly adjusted; average daily production for 2012 is now expected to range from 66-69 MMcfe/d.
Upcoming Conference Schedule
Management will present at the Johnson Rice & Company 4th Annual Energy Conference in New Orleans on October 2, 2012. Webcast information for this event, if available, will be posted in the Investor Relations section of the Rex Energy website, www.rexenergy.com, under Events & Presentations. Webcasts will remain available for 30 days after the event.