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Range Third Quarter Production Reaches Record Level

RANGE RESOURCES CORPORATION (NYSE: RRC) today announced that its third quarter 2013 production volumes reached a record high of 960 Mmcfe per day, a 21% increase over the prior year quarter.
  • Production was 77% natural gas, 16% natural gas liquids (“NGLs”) and 7% crude oil and condensate.
  • Compared to the prior year quarter, oil and condensate production increased 43%, NGL production rose 28%, while natural gas production increased 19%.
  • Adjusting for the sale of the New Mexico properties which closed at the beginning of the second quarter of 2013, third quarter production would have increased 24% over the prior year quarter with oil and condensate production increasing 58%, NGL production increasing 29% and natural gas production increasing 21%.

The record production was primarily driven by the continued success of the Company’s drilling program in the Marcellus Shale. Third quarter production of 960 Mmcfe per day exceeded the high-end of Company guidance of 945 – 950 Mmcfe per day due to continued positive performance of wells in the Marcellus Shale and the timing of turning wells to production.

The Company also announced its preliminary third quarter 2013 natural gas, NGLs and oil price realizations (including the impact of cash-settled hedges and derivative settlements which would correspond to analysts’ estimates) averaged $4.80 per mcfe, a 2% composite decrease from the prior year quarter.
  • Production and preliminary realized prices by each commodity for the third quarter of 2013 were: natural gas – 739 Mmcf per day ($3.88 per mcf), NGLs – 25,678 barrels per day ($31.08 per barrel) and crude oil and condensate – 11,065 barrels per day ($85.46 per barrel).
  • The third quarter average natural gas pricing improved $0.65 per mcf, before hedging settlements, as compared to the prior year quarter. Financial hedges added $0.45 per mcf in the current quarter and added $1.10 per mcf in the prior year quarter.
  • NGL pricing, before hedges, was 31% of the West Texas Intermediate index (“WTI”) for the third quarter compared to 33% of WTI for the second quarter of 2013. The change was primarily due to a disproportionate increase in WTI price compared to the NGL components during the quarter. Marcellus ethane sold on the Mariner West project contributed 876 barrels per day to the NGL mix. NGL realizations, excluding Marcellus ethane, would have been 32% of WTI.
  • Crude oil and condensate price realizations, before hedges, for the third quarter averaged 87% of WTI compared to 89% in the second quarter of 2013. Crude oil and condensate realizations for the prior year quarter were 90% of WTI before hedges.

Range estimates that during the third quarter it incurred a net expense of approximately $3.7 million related to purchasing and blending third party dry gas into its rich residue gas from the southwest portion of the Marcellus. The purchase and sale will be reported separately in “Brokered natural gas and marketing revenues and expenses” for the quarter. The Mariner West project, expected to be fully operational during November, will eliminate Range’s need for gas blending in the future.

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