Thursday, February 28, 2013

EXCO Year End Update

Last week, EXCO Resources reported its year end results.  Below is a high level summary of results relative to the Haynesville Shale:

  • Year-over-year net production in the Haynesville Shale increased by 5% in 2012, but fourth quarter net production dropped from 407 MMcf/day in 2011 to 334 MMcf/day in 2012. 
  • In 2012, EXCO drilled 58 operated wells (21.8 net) and it completed 71 wells.  The average IP rate was 12.7 MMcf/day with a flowing casing pressure of 7,784 psi.  All of the wells were produced on a reduced choke (18/64").  
  • The company continues to focus its efforts on DeSoto Parish, LA.  In 2013, the plan is to drill 26 wells (15.5 net) with a three rig program. The company plans to complete 42 wells (22.1 net) in 2013, as it continues to work through its backlog of drilled wells.
  • Haynesville Shale well costs at the end of 2012 were $8.0 million per well versus $9.5 million a year earlier, as the competitive landscape for services shifted in favor of producers and EXCO continues to refine its completion techniques.
Bottom line, EXCO is doing a good job but it is going to continue pulling back.  From Q4 2012 to Q1 2013, EXCO's rig count has dropped from five to three and production is on a downward trajectory.

1 comment:

Anonymous said...

Exco will lower their rig count to 2 very soon. On their year end presentation they claim to be able to drill a NLA well in 28 days and 28 days and 26 wells equals only a 2 rig count. I expect a rig to be leaving once they find a new location for it or one goes off contract. The above is IMHO.