Why EQT Expects Higher Production In 3Q17
EQT’s 3Q17 production guidance
For 3Q17, EQT (EQT) anticipates total production volume of 205–210 Bcfe (billion cubic feet equivalent) or 207.5 Bcfe at the mid-point. This outlook compares to 3Q16 production of 196 Bcfe and 2Q17 production of 198.1 Bcfe.
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EQT’s production expectations are higher for 3Q17 and 2H17 in general due to increased planned completion activity in 2H17. In the 2Q17 earnings conference, EQT’s management noted, “We anticipate approximately 55 Marcellus and Upper Devonian wells to be turned in line in the third quarter and 58 in the fourth quarter. This is approximately three times the pace of the first six month of this year, during which we had 19 wells turned in line in the first quarter and 17 wells in the second quarter.”
EQT’s 2017 production guidance lowered
In 2Q17, EQT’s 2017 production guidance range reduced from 10 Bcfe–15 Bcfe to 825 Bcfe–840 Bcfe. This reduction was due to EQT suspending its Utica test program in anticipation of its merger with Rice Energy (RICE).
EQT noted that, compared with its Utica inventory, it had multiple years of long lateral inventory in the Marcellus that the Utica program couldn’t compete with. EQT’s Utica program was forecast to contribute 18.0 Bcfe to its 2017 annual volumes.
Effect of EQT-RICE Merger on EQT’s production volumes
EQT’s (EQT) acquisition of Rice Energy (RICE) is expected to add around 1.3 Bcfe (billion cubic feet equivalent) per day to its natural gas volumes. According to EQT, the combined EQT-RICE will result in the largest natural gas producer in the United States, leaving behind ExxonMobil (XOM) and Chesapeake Energy (CHK) at number 2 and number 3, respectively.
Pro forma for the Rice Energy (RICE) acquisition, EQT’s combined-company sales volume guidance for 2017 is 1.3 Tcfe (trillion cubic feet equivalent).
To learn more, see What’s EQT’s Production Outlook for This Year?