STATE COLLEGE, Pa., June 21, 2016 (GLOBE NEWSWIRE) -- Rex Energy Corporation (Nasdaq:REXX) today provided an update on its Moraine East Joint Development Agreement and Appalachian Basin operations.
Moraine East Area Joint Development Agreement
In the Moraine East Area, the company’s joint development partner, Benefit Street Partners L.L.C. (“BSP”) has elected into the next 12 wells in the development program. BSP’s election increases the total capital commitment to date by BSP from $51.6 million to $98.1 million and BSP’s total well participation in the Moraine East Area to 30 wells. With the additional capital commitment from BSP, the company expects full year 2016 net operational capital expenditures to be approximately $35.5 million. A table providing quarterly capital expenditures has been provided on slide 5 of the company’s corporate presentation, which is available at www.rexenergy.com under the Investor Relations tab.
“The increased $45.7 million capital commitment from BSP, plus the proceeds from the recently announced Illinois Basin sale, will provide Rex Energy with over $80 million of additional liquidity in 2016,” said Tom Stabley, President and CEO of Rex Energy. “The liquidity will enable Rex Energy to continue our plan to hold the majority of our Appalachian Basin acreage by production by mid-year 2017.”
Moraine East Area Operations
Rex Energy completed its 20th well in the Moraine East Area, the Kleaver 2HB. The well, which has the longest lateral to date for the company at approximately 10,200 feet, was drilled in approximately 9.5 days - a new record for the company. Rex Energy is currently drilling the third of four wells on the Baird pad; the four wells have a planned average lateral length of approximately 7,200 feet. In addition, the company has reached an agreement with its gathering partner in the Moraine East Area to reduce its overall minimum daily volume commitment in the region.
Butler Operated Area Well Costs
Through additional cost control and operational efficiencies, the company has further reduced its cost to drill and complete a 6,000 foot lateral on a four-well pad. The average drilling and completion cost is now $5.0 million, a 6% reduction from the previously reported average of $5.3 million. The company continues to focus on cost control measures and anticipates that it will be able to achieve further cost reductions and efficiencies in 2016.
Warrior North Prospect
The company placed the three wells on the Goebeler pad into sales; the wells were drilled to an average lateral length of approximately 7,500 feet and completed with an average of 43 stages. The preliminary results from the Goebeler pad are encouraging, and management anticipates providing sales rates on the second quarter 2016 earnings conference call. The company is currently completing the two-well Perry pad, with an average lateral length of approximately 6,650 feet, and expects to place the wells into sales during the third quarter.
About Rex Energy Corporation
Headquartered in State College, Pennsylvania, Rex Energy is an independent oil and gas exploration and production company operating in the Appalachian and Illinois Basins within the United States. The company’s strategy is to pursue its higher potential exploration drilling prospects while acquiring oil and natural gas properties complementary to its portfolio.
This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. Forward-looking statements are based on current beliefs and expectations and involve certain assumptions or estimates that involve various risks and uncertainties, such as financial market conditions, changes in commodities prices and the other risks discussed in detail in the company’s Annual Report on Form 10-K for the year ended December 31, 2015 and other subsequent filings with the Securities and Exchange Commission. Readers should not place undue reliance on any forward-looking statements or estimates contained in this release, which are made only as of the date hereof. Rex Energy has no duty, and assumes no obligation, to update forward-looking statements or estimates as a result of new information, future events or changes in the company’s expectations.
For more information contact: Investor Relations (814) 278-7130 InvestorRelations@rexenergycorp.com
Source:Rex Energy Corporation