OKLAHOMA CITY, Okla. — Chesapeake Energy Corporation, a key player in the Utica and Marcellus shale plays of eastern Ohio and western Pennsylvania, reported a net loss for the 2015 third quarter of $4.695 billion, or $7.08 per fully diluted share, or an adjusted net loss of five cents per fully diluted share.
“While the current price environment presents many challenges for our industry, we will continue focusing on our capital and operating cost efficiency, enhancing our cash flow and financial flexibility and optimizing our base production,” said Doug Lawler, Chesapeake’s chief executive officer.
Operating cash flow was $476 million in the 2015 third quarter, compared to $1.293 billion in the 2014 third quarter.
Utica shale net production averaged approximately 106 mboe per day during the third quarter, a decrease of 15 percent, as the company curtailed production as a result of weak product pricing. Average completed well costs to date in 2015 are $7.7 million, with an average completed lateral length of 7,900 feet and 40 frac stages, compared to the full-year 2014 average completed well cost of $7.2 million with an average completed lateral length of 6,200 feet and 29 frac stages.
During the 2015 third quarter, the company drilled a new record lateral length in the Utica of 12,976 feet.
Chesapeake averaged two rigs in the Utica in the third quarter, which is expected to be maintained end of the year.
Third quarter Marcellus net production averaged approximately 809 mmcf per day, a decrease of 1%. Recent third quarter well results include two tests of the Upper Marcellus formation located in Bradford County, Pennsylvania, which had completed lateral lengths of 5,600 feet and 4,800 feet, respectively, and reached peak 24-hour production rates of approximately 19,000 mcf per day and 17,000 mcf per day, respectively.
The company believes that these successful completions in the Upper Marcellus could provide more than 1,000 potential new drilling locations.
The company anticipates maintaining one operated rig through the end of the year in the Marcellus play.
Chesapeake’s daily production for the 2015 third quarter averaged approximately 667,000 barrels of oil equivalent (boe), a year-over-year increase of 3% adjusted for asset sales. Average daily production in the 2015 third quarter consisted of approximately 114,100 barrels (bbls) of oil, 2.9 billion cubic feet (bcf) of natural gas and 76,200 bbls of NGL, which represent year-over-year increases of 4%, 2% and 7%, respectively.
Production expenses during the 2015 third quarter were $4.09 per boe, while general and administrative expenses were 79 cents per boe.
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