Approach Resources Inc. (NASDAQ: AREX) today announced preliminary production, commodity prices and capital expenditures for third quarter 2012. Highlights compared to prior-year period include:
- Total production up 22% to 8.1 MBoe/d
- Oil production increases 113% to 250 MBbls
Third Quarter 2012 Production
Estimated third quarter 2012 production totaled 747 MBoe (8.1 MBoe/d), compared to 612 MBoe (6.7 MBoe/d) produced in third quarter 2011, a 22% increase. Estimated third quarter 2012 production also increased 7% over second quarter 2012 production of 702 MBoe (7.7 MBoe/d). Estimated oil production for third quarter 2012 increased 113% to 250 MBbls, compared to 117 MBbls produced in third quarter 2011. Estimated production for third quarter 2012 was 34% oil, 31% NGLs and 35% natural gas, compared to 19% oil, 38% NGLs and 43% natural gas in third quarter 2011.
Production from north Project Pangea in the Wolfcamp oil shale resource play was impacted by downtime at a third-party natural gas processing facility during third quarter 2012. We estimate that the impact to third quarter 2012 production as a result of plant downtime totaled approximately 340 Boe/d. We expect that intermittent downtime may continue through mid-November 2012.We have begun construction on a new, 5.5 mile, 8-inch high-pressure natural gas line to deliver our natural gas production from north Project Pangea to a gas processing facility in Ozona, Texas (“Ozona Plant”) with improved economics and higher capacity than the current, third-party facility for our north Project Pangea natural gas. We expect the new gas line to be operational by the second week of November 2012. In addition, we are beginning construction of a second new, 3.1 mile, 8-inch high-pressure natural gas line in Block 45 of Project Pangea to transport gas to the Ozona Plant. We anticipate completion of this line by the third week of November 2012. Once these lines are completed, 100% of our natural gas will be delivered to the Ozona Plant.