EQT Corp. (NYSE: EQT) reports year-end 2012 total proved reserves of 6,004 billion cubic feet equivalent.
This represents a 639 billion cubic feet equivalent net increase over the 5,365 billion cubic feet equivalent reported last year, with a reserve replacement ratio of 345%. The company's Marcellus proved reserves increased by 864 billion cubic feet equivalent based on wells drilled in 2012, a higher EUR from reduced cluster spacing wells, and an increased well density across a portion of its acreage in Greene County, Pa. The utilization of reduced cluster spacing increased EUR an average of 23% per well, where applicable. Reduced cluster spacing was used for approximately 25% of the proved developed wells, and will be used for 25% of the proved undeveloped wells. The EUR of proved Marcellus wells averaged 6.4 billion cubic feet equivalent, with an average length of pay of 4,512 feet.
For 2012, drill bit finding costs were $0.53 per thousand cubic feet equivalent. The company's Marcellus proved developed producing additions totaled 309 billion cubic feet equivalent on $389 million of capital for a development cost of $1.26 per thousand cubic feet equivalent. Proved developed producing negative revisions totaled 110 billion cubic feet equivalent, primarily due to a reduction in expected well life, as a result of lower natural gas prices. Nearly all of the negative revisions relate to Coal Bed Methane (CBM) and other vertical wells.
EQT estimates year-end 2012 total reserves, including proved, probable and possible reserves, at 25.9 trillion cubic feet equivalent, an increase of 4.5 trillion cubic feet equivalent over the 2011 estimate. More than half of the proved, probable and possible reserves increase was from a portion of the company's 170,000 Upper Devonian net acreage, which are expected to be developed independently from the Marcellus. The company also has 13,600 net Utica acres in Ohio, which add an insignificant amount of possible reserves. To delineate the plays, EQT plans to drill 11 Upper Devonian and eight Utica wells in 2013.
Ryder Scott Co. , petroleum consultants audited 100% of the company’s proved reserves, while estimated proved, probable and possible reserves are determined in accordance with the Securities and Exchange Commission regulations. The company also made an assessment of its total resource potential, which include proved, probable and possible reserve totals.
Headquartered in Pittsburgh, EQT Corp. is an integrated energy company with emphasis on Appalachian area natural gas production, gathering, transmission, and