Rice Energy Announces Utica Shale Well Results
Rice Energy Inc. (NYSE: RICE) today reported that it has successfully tested the company’s first Utica Shale well in central Belmont County, Ohio. In addition, Rice has strategically added to its firm transportation portfolio, providing increased market access for its growing production profile. Finally, Rice’s borrowing base under its revolving credit facility was increased to $385.0 million.
Bigfoot 9H Production Test
We are pleased to announce the production test results of our first operated Utica Shale well, the Bigfoot 9H. After five days of flowback, the Bigfoot 9H stabilized at a rate of 41.69 MMcf/d of gas on a 33/64″ choke with flowing casing pressures of 5850 psi. Based upon a gas composition analysis, the heat content is 1086 Btu and therefore will not require processing. We own an approximate 93% working interest in the well, which has an effective lateral length of 6,957 feet and was completed with a 40-stage frac. We anticipate first production by early July and will produce the well into sales through our restricted choke program.
Toby Rice, Chief Operating Officer, commented, “This Bigfoot test is a significant step towards validating the production potential of the Utica Shale in central Belmont County, where we control more than 46,000 net acres. We are especially pleased to deliver these strong results to the landowners of Belmont County, who have believed in us from the beginning. Our 2014 Ohio program is off to a great start, and we look forward to continuing our methodical development of this world-class asset.”
Firm Transportation on Rockies Express Pipeline
To further ensure the deliverability of our Utica Shale production, we have entered into a precedent agreement for 175,000 MMBtu/d firm transportation on the Rockies Express Pipeline beginning in June 2015 for a term of 20 years. The Rockies Express Pipeline will provide us with greater access to Gulf Coast and Midwest markets. With this capacity, our firm transportation and firm sales portfolio will cover approximately 818,000 MMBtu/d in 2015 and 921,000 MMBtu/d in 2016. We expect to enter into a firm transportation services agreement and satisfy other customary conditions precedent to our receiving the referenced capacity in the near term.
Redetermined Borrowing Base
In connection with our third amended and restated credit agreement effective April 2014, our borrowing base was subsequently redetermined and increased to $385.0 million. This increase provides us with greater financial flexibility to develop our prolific Appalachian assets.