OKLAHOMA CITY, April 8, 2013 (GLOBE NEWSWIRE) -- PostRock Energy Corporation (Nasdaq:PSTR) today provided an update on its production and capital projects for the first quarter of 2013. During the quarter, approximately $9 million was spent on development. Net oil sales during the quarter averaged slightly more than 360 Bbls a day, a 77% increase from the first quarter of 2012. At March 31 st, net oil production exceeded 500 Bbls per day. Net gas sales during the period declined 13% from the prior year to an average of 41.3 MMcf per day. The decline in gas production was due to suspension of development spending on gas projects since September 2011 due to low prices. The gas production decline was amplified by challenging weather during the first quarter. Based on PostRock's first quarter 27:1 realized price equivalency ratio of oil to natural gas, production in the first quarter increased very slightly from the fourth quarter of 2012. If the projects described below continue to be successful, a more meaningful rate of increase should be achieved as the year progresses.
During the first quarter, the Company placed 55 new wells and 42 recompletions on production. Two recompletions were located in Central Oklahoma with the other projects all being in the Cherokee Basin. While project returns vary, overall, IRR's at the lease level are expected to range from 30% - 50%. Based on current oil prices and the high success rate on these projects, we expect to drill an additional 150 oil wells and recomplete 20 additional wells in the Cherokee Basin during the remainder of 2013.
PostRock also recently initiated a modest leasing program in Central Oklahoma, where the Company currently holds approximately 2,500 net acres. While the leasehold position is modest, the area represented the majority of the Company's year-end 2012 SEC oil reserves. PostRock expects to begin its 2013 Central Oklahoma drilling program during the third quarter. In total, the Company plans to drill six wells, including two horizontal wells, in Central Oklahoma during the remainder of 2013. The wells will focus on currently producing horizons; however, we hope to test a prospective horizon that does not produce locally but that has been successfully developed elsewhere in the state.