Rex Energy recently fracture stimulated two new horizontal Marcellus Shale wells in Westmoreland County, Pennsylvania. The two wells, which had average lateral extensions of approximately 2,200 feet, were stimulated with six stages each. The wells are continuing to clean up and production is still inclining; however, based on the initial data, Netherland has estimated the gross proved reserves of these two wells to be approximately 3.0 Bcf each.
The company has also completed drilling its second horizontal well in Clearfield County, Pennsylvania, which it expects to fracture stimulate by the end of the month. Additionally, the company is currently drilling one horizontal well in Westmoreland County. The company expects to spud its second horizontal well in Butler County, Pennsylvania this week and to drill one additional horizontal well in Westmoreland County during the first quarter of 2010 before turning operations in that area over to Williams Appalachia ("Williams"), its 50% partner in the area.
Rex Energy's current total acreage under control in the Marcellus Shale fairway has increased approximately 21% compared to the third quarter 2009 to 92,000 gross (60,000 net) acres. The net acreage amount excludes approximately 22,000 acres, which can be earned by Williams pursuant to the Participation and Exploration Agreement entered into on June 18, 2009, but includes approximately 7,700 acres covered by oil and gas leases that are pending title verification and final closing.
In a final comment, Mr. Hulburt said, "We have spent the past two years adding to our Marcellus Shale acreage position; building an experienced management team dedicated to enhanced oil recovery and shale exploration; studying chemical flooding in the Lawrence Field; drilling exploratory wells to de-risk our Marcellus Shale acreage; and refining our technical understanding of the Marcellus Shale and ASP Flooding, all while keeping a conservative balance sheet through the use of hedging, debt management and strategic partnerships. Looking forward, we believe that 2010 has the potential to be a year of tremendous growth for Rex Energy as we accelerate development in the Appalachian Basin and commence injection on our first ASP Flood unit in the Illinois Basin."
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