Eclipse Resources Enters Into $325M Utica Joint Venture
STATE COLLEGE, Pa. – Eclipse Resources has signed an agreement with Sequel Energy Group to establish a joint venture to drill in the Utica shale in southeastern Ohio, the company announced Wednesday.
Sequel has committed up to $325 million to fund its portion of two drilling programs that include 34 existing wells and those wells developed through the end of 2018, Eclipse said in a news release announcing its second quarter earnings.
“We believe that the joint venture commitment we have recently entered into with Sequel speaks to both the quality of our assets and our industry-leading operational performance,” said Benjamin W. Hulburt, chairman, president and CEO of Eclipse, said in a statement.
“Perhaps most importantly, as we see a significant amount of commodity volatility looking into 2018, the terms of this drilling joint venture will allow us to maintain, or even accelerate our current drilling pace, while scaling our company level capital expenditures based on the economic environment,” Hulburt said.
Eclipse reported net income of $11.5 million for the three-month period ended June 30. Average daily net production from the company’s wells stood at 287.8 million cubic feet per day, exceeding the high end of the company’s production guidance range of 265 to 275 million cubic feet per day.
“Our seven-well Moser pad, located in the company’s dry gas acreage in eastern Monroe County, Ohio, was turned to sales in June and has produced an average rate of approximately 19% above our recently increased dry gas type well expectation,” Hulburt said.
The company has pursued development in the Utica shale by drilling record-setting “super laterals” at its horizontal well pads in its Utica condensate acreage.
“We are currently completing what we believe to be the longest onshore laterals ever drilled,” Hulburt said, noting the company’s Great Scott 3H well boasts a 19,100-foot lateral and its Outlaw C11H well stands at a 19,500-foot lateral.
Copyright 2024 The Business Journal, Youngstown, Ohio.