Range Resources has achieved a significant milestone in the development of the Marcellus Shale formation in Pennsylvania, as its net production from the Marcellus Shale has reached 100 Mmcfe per day. This represents almost a four-fold increase over this time last year and represents the high end of Range's 2009 production target of 80 to 100 Mmcfe net per day. Range's Marcellus Shale production target exit rate for 2010 is 180 to 200 Mmcfe net per day. Given the significant progress made in 2009, in all phases of the development process, Range has extended its forecast to include a 2011 exit rate from the Marcellus Shale of 360 to 400 Mmcfe net per day. It is important to emphasize that all the production results and targets referred to above are net to Range's interest and exclude production attributable to landowners' royalty interests and third-party working interests.
Commenting on the announcement, Jeff Ventura, Range's President and Chief Operating Officer, said, "We are extremely pleased with the progress of our Marcellus Shale team. They have quadrupled Marcellus production in 2009 and continue to optimize drilling and completion techniques. As a result, our per-well production rates continue to improve, while costs continue to decline. We are well-positioned to ramp up our Marcellus production at low cost."
Range entered 2009 running four rigs in the Marcellus Shale play and will end the year with eleven rigs, including both horizontal and vertical rigs. Range anticipates exiting 2010 with 16 rigs in the Marcellus, increasing to 24 by year-end 2011. Additionally, Range has completed the drilling of two horizontal wells in Lycoming County, Pennsylvania, in the northeastern portion of the play. Completion operations have commenced on the first of these two wells.
Commenting on the announcement, John Pinkerton, Range's Chairman and Chief Executive Officer, said, "With the wells drilled by Range and the industry, we believe that approximately 390,000 net acres of Range’s large leasehold in the southwestern portion of the play has been materially de-risked. Our Marcellus team is continuing to delineate our sizeable acreage position in the northeastern part of the play. In addition, we are testing additional shale formations, above and below the Marcellus. It's becoming more and more clear that the Marcellus Shale will likely become a very large natural gas field. This is a game changer for Range and its shareholders, for Pennsylvania and energy consumers. According to a study by Penn State University, the Marcellus Shale has the potential to create 98,000 jobs and to contribute $14 billion to Pennsylvania's economy in 2010. All of us at Range are proud to have pioneered the Marcellus Shale and believe it is a shining example of the private sector working together with public agencies to create a long-lasting stimulus. Importantly, clean-burning natural gas produced in the U.S. can reduce our dependence on foreign oil, create jobs, strengthen our economy and dramatically reduce carbon emissions."
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