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How Is the Comanche Acquisition Working Out for Sanchez Energy?

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Part 9
How Is the Comanche Acquisition Working Out for Sanchez Energy? PART 9 OF 13

Sanchez Energy’s 2Q17 Production and Operational Highlights

Sanchez Energy’s 2Q17 production

Sanchez Energy’s (SN) production volumes in 2Q17 totaled 73.3 Mboepd (thousand barrels of oil equivalent per day). In comparison, its 2Q16 production volumes were 55.9 Mboepd. Sanchez’s 1Q17 production volumes were 51.8 Mboepd. SN’s strong production in 2Q17 was driven by the Comanche acquisition from Anadarko Petroleum (APC), which closed in early March 2017.

About 31% of Sanchez’s 2Q17 production volumes were made up of oil, and 32% were made up of NGLs (natural gas liquids). The remaining 37% were made up of natural gas.

Sanchez Energy’s 2Q17 Production and Operational Highlights

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SN’s cost efficiencies

Sanchez’s total cash operating costs, including lease operating expenses (or LOE), general and administrative expenses, tax, and interest and dividends, averaged $20.08 per boe (barrel of oil equivalent) in 2016, compared to $45.06 in 2011, a reduction of ~55%.

SN’s management said during its 2Q17 earnings conference that the company is focused on increasing drilling rates of return, both through well costs and higher production rates. The company’s management noted, “We believe that we have been successful in the area of driving operational efficiencies and currently operate with the best in class cost structure in our area of focus.”

2017 and 2018 production guidance

Production in 3Q17 is expected to range between 70,000–74,000 boepd in 3Q17 and 80,000–84,000 boepd in 4Q17. Its production is expected to rise to 90,000–100,000 boepd by 1H18.

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