Range Proved Reserves Increase 18% to 3.1 Tcfe
Range Resources' proved reserves at December 31, 2009 increased 18% to 3.1 Tcfe. From all sources, Range replaced 486% of production in 2009 with all the reserve replacement occurring through the drill bit and positive performance revisions. Finding and development costs from all sources, including leasehold additions and all price and performance revisions, averaged $0.98 per mcfe. Excluding price revisions, finding and development costs averaged $0.89 per mcfe. Drill bit development costs averaged $0.68 per mcfe.
For 2009, Range added 770 Bcfe of proved reserves through the drill bit. No reserves were added through acquisitions. Performance revisions added 90 Bcfe, while price revisions reduced proved reserves by 86 Bcfe. During 2009, Range sold properties containing 140 Bcfe of proved reserves and production was 159 Bcfe. As a result, year-end 2009 reserves totaled 3.1 Tcfe; up 18% from the 2.7 Tcfe at year-end 2008.
At year-end 2009, 84% of Range's proved reserves by volume were natural gas, 10% were natural gas liquids and 6% were crude oil. Of the total, 77% of proved undeveloped reserves were located in the Marcellus, Barnett and Nora properties. The percentage of reserves in the proved undeveloped category was 45% at year-end 2009, versus 38% at year-end 2008. The increase in percentage of proved undeveloped reserves was primarily due to the recording of additional proved undeveloped reserves in the Marcellus Shale play where Range had outstanding results in 2009. As of year-end 2009, for each of its proved developed wells in the Marcellus Shale play, Range recorded on average 1.2 offset drilling locations as proved undeveloped reserves. Range currently estimates that its unproven Marcellus acreage position contains resource potential, net to its interest, of 18 to 25 Tcfe.
As noted above, from all sources, Range replaced 486% of production in 2009. Excluding the 86 Bcfe of price revisions, reserve replacement would have been 540% of production in 2009. The Company’s estimate of cash drilling and development costs incurred during 2009 including exploration expenses is $585 million. The Company estimates that it spent $177 million for acreage in 2009. Finding and development cost from all sources averaged $0.98 per mcfe with price revisions, or $0.89 per mcfe excluding price revisions. Drill bit development cost (excludes price revisions and acreage cost) was $0.68 per mcfe.
In 2009, Range sold properties containing 140 Bcfe of proved reserves. The sold properties included the Fuhrman Mascho field in West Texas and essentially all of the Company’s properties in the State of New York. These properties included 2,291 producing and non-producing wells.
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