Ultra Petroleum’s 3Q16 production performance
Sequentially, Ultra Petroleum’s 3Q16 production is ~2% lower compared to 2Q16.
Ultra Petroleum’s 3Q16 production mix and realized prices
In 3Q16, Ultra Petroleum reported ~93% natural gas (UNG) in its production mix. For 3Q16, its average realized price for natural gas production fell ~2% to $2.62 per Mcf (thousand cubic feet)—compared to $2.68 per Mcf for the same period in 2015.
Ultra Petroleum’s operational update
For 3Q16, ~92% of Ultra Petroleum’s production came from its Wyoming operations. In 3Q16, Ultra Petroleum drilled 21 gross (14 net) Pinedale development wells and placed 50 gross (25 net) wells in production.
According to Ultra Petroleum’s estimates, assuming well costs of $2.6 million per well, estimated ultimate recovery of 4.5 Bcfe, and wellhead prices of $3.00 per Mcf for natural gas and $50.00 per barrel for crude oil, the expected return for its Pinedale wells is ~54%.
Ultra Petroleum’s capital expenditure guidance
In July 2016, Ultra Petroleum increased its fiscal 2016 capital expenditure to $295 million—an increase of $35 million (or ~13%) from its previous capital expenditure guidance of $260 million. The company plans to use the additional capital from its increased budget to drill additional development wells in Wyoming and complete some of its incomplete wells in Utah.
Ultra Petroleum’s production guidance
On October 27, 2016, Ultra Petroleum increased its fiscal 2016 production guidance to 281–284 Bcfe—a mid-point increase of 2 Bcfe (or ~1%) from its old production guidance of 280.5 Bcfe.