Seneca Resources Corporation (“Seneca”), the wholly owned exploration and production subsidiary of National Fuel Gas Company (NYSE:NFG) (“National Fuel” or the “Company”) reports that production volumes for the fiscal year’s fourth quarter ended September 30, 2013, totaled 33.2 billion cubic feet equivalent (“Bcfe”), a 35% increase over the prior year’s fourth quarter. Total production for fiscal year 2013 was 120.7 Bcfe, which was a 45% increase over fiscal year 2012. Additionally, Seneca’s proved natural gas and crude oil reserves as of September 30, 2013, increased 24% to a record high of 1,549 Bcfe.
Seneca’s total production of 33.2 Bcfe, or 361 million cubic feet equivalent (“MMcfe”) per day, was driven by the continued success of Seneca’s Marcellus Shale development program in Lycoming County, Pa. Natural gas production increased 42%, to a total of 28.9 Bcf, despite nearly 3 Bcf of price-related curtailments. Crude oil production totaled 717,000 barrels, which was an increase of 1.6% from the prior year’s fourth quarter. Growth in crude oil production was limited primarily as a result of a continued constraint in a third-party pipeline used to transport associated natural gas production within the Sespe Field. This is expected to be resolved by the end of January 2014.
Reserves Update (Preliminary)
During fiscal year 2013, Seneca replaced 351% of production to reach a total of 1,549 Bcfe of proved reserves as of September 30, 2013. Seneca’s success through the drill bit in the Marcellus Shale led to a 311 Bcf, or 31%, increase in natural gas reserves, which totaled 1,300 Bcf at fiscal year end. Crude oil reserves, which decreased by 3% largely due to production, totaled 41.6 million barrels at September 30, 2013.
Of the total reserves, 71% were classified as proved developed reserves. This is an increase from 67% proved developed reserves as of September 30, 2012. Proved undeveloped (“PUD”) reserves totaled 29% of the total reserves at the end of the fiscal year.