The capital budget does not factor in proceeds from potential strategic partnerships or asset sales.
At December 31, 2012, Quicksilver's total debt was approximately $2.1 billion, or approximately $100 million less than the previous quarter. Included within debt, the company had approximately $450 million utilized under its Combined Credit Agreements as of year-end 2012, resulting in approximately $400 million of remaining capacity. The majority of the debt reduction is due to the repayment of credit facility borrowings with the joint venture proceeds from the Niobrara transaction.
The semiannual redetermination of the Combined Credit Agreements is scheduled for April 2013. The company expects a yet-to-be determined reduction in the borrowing base; however, after redetermination, the credit facility is expected to provide adequate liquidity to execute planned initiatives.
Quicksilver's 2013 budget and projections yield continued credit facility covenant compliance and sufficient liquidity through 2013, but if prices deteriorate, the company may reduce the capital program, reduce headcount and expenses, and/or work with the lender group to amend the covenant requirements. Additionally, successful consummation of a strategic transaction would also allow continued covenant compliance.
First Quarter 2013 and Full-Year 2013 Outlook
First-quarter 2013 average daily production volume is expected to be 360 - 365 MMcfe per day, and full-year production volume is expected to be 335 - 345 MMcfe per day, originating as follows: 65% in the Barnett Shale, 33% in Canada, and 2% in other U.S. basins. Average daily production volumes are expected to consist of 82% natural gas and 18% natural gas liquids and crude oil.
For the first quarter of 2013, average unit expenses, on a Mcfe basis, are expected as follows:
| * Lease operating expense
|| $0.80 - $0.82
| * Gathering, processing & transportation
|| 1.20 - 1.22
| * Production and ad-valorem taxes
|| 0.14 - 0.16
| * General and administrative
|| 0.55 - 0.57
| * Depletion, depreciation & accretion
|| 0.52 - 0.54
The company's natural gas swap portfolio is as follows: 200 MMcfd for 2013 at a weighted-average price of $5.10 per Mcf, 170 MMcfd for 2014 at $5.08 per Mcf, 150 MMcfd for 2015 at $5.23 per Mcf, and 40 MMcfd for 2016-2021 at $4.48 per Mcf.