PDC Energy Announces 2013 Third Quarter Results: Solid Wattenberg Production; Initial Production From Wattenberg 16-Wells Per Section Downspacing Project Outperforming Type Curves; Strong Production From First Horizontal Washington County Utica Well
Depreciation, depletion and amortization ("DD&A") expense related to crude oil and natural gas properties was $29.6 million, or $17.25 per Boe, in the third quarter of 2013, compared to $21.0 million, or $15.87 per Boe, in the third quarter of last year. The increase in DD&A expense in the third quarter of 2013 was primarily due to an increase in production volumes and initial DD&A expense related to Utica production.
Interest expense for the third quarter of 2013 was $12.5 million compared to $11.4 million for the third quarter of 2012. The increase in interest expense was primarily related to increased interest expense associated with the issuance of $500 million of 7.75% senior notes due 2022 in October 2012, the proceeds of which were used to redeem $203 million of then-outstanding 12% senior notes due in November 2012, partially offset by lower average borrowings on the Company's revolving credit facility.
In August 2013, the Company completed a public offering of 5,175,000 shares of its common stock. Net proceeds of approximately $276 million are expected to be used to fund a portion of an expanded capital expenditure program for the remainder of 2013 and 2014, including the addition of a fourth drilling rig in the Wattenberg Field in the fourth quarter of 2013, as well as the potential for a second rig in the Utica Shale in 2014, and for general corporate purposes. The Company may also use a portion of the proceeds to acquire additional Utica shale acreage and/or to add a fifth drilling rig in the Wattenberg Field in 2014.
PDC's available consolidated liquidity position as of September 30, 2013 was $735 million, compared to $399 million as of December 31, 2012, primarily due to proceeds from the August 2013 public offering of the Company's common stock. As of September 30, 2013, PDC had no outstanding draws on its $450 million revolving credit facility.
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