HOUSTON, April 28, 2014 /PRNewswire/ -- Sanchez Energy Corporation (NYSE: SN) ("Sanchez Energy" or the "Company") today provided an update on its first quarter 2014 production and operations.
- Sanchez Energy reported first quarter 2014 production of approximately 1,691 MBOE (18,784 BOE/D), an increase of 376% compared to the same period a year ago
- Reported production volumes consisted of 72% oil, 15% NGLs, and 13% natural gas
- Current production is approximately 21,000 BOE/D with 13 gross wells in various stages of completion
Tony Sanchez, III, President and Chief Executive Officer of Sanchez Energy, commented: "Our ability to more than triple our first quarter production year over year reflects positively on both the quality of our assets and the efficiency of our operations. Moving forward, we will continue to leverage our proprietary systems and drilling processes to drive down costs per well, reduce drill time and enhance our capital efficiencies. This strategy already has effectively reduced drill time by 40%, doubled the number of frac stages pumped per day and decreased total well costs by 30% across our Eagle Ford operations."
"Production of 18,784 BOE/D for the first quarter of 2014 is within our guidance range of 18,000 to 20,000 BOE/D and at the high end of our recent guidance updates. We were able to accelerate some completions that were originally planned for early 2014 into last year's fourth quarter, resulting in the majority of the 20 gross (14 net) new wells for the quarter coming online in late February and March."
"We have advanced our operations to include much more pad drilling, which helped raise our current production to approximately 21,000 BOE/D. Moving forward, we expect strong – if a bit uneven – production growth, which is customary with more aggressive pad drilling. We view this as a welcome trade-off, as this more efficient drilling practice is a significant driver of our reported cost savings. That noted, we reiterate our full year 2014 production guidance range of 21,000 to 23,000 BOE/D."
Eagle Ford Operations Update
"Eagle Ford operations continue to be in full-scale development mode with six gross rigs running across our areas. In the Five Mile Creek area of Marquis, we are drilling the last well of a four-well pad, which is expected to further de-risk that 10,000 net acre position. We also recently brought online the Prost O #1H – our sixth and final pilot well in the Marquis appraisal program – at rates consistent with our other Prost area wells. This step-out well just east of our main Prost acreage block position has further expanded our inventory. After cleaning out the Sante North #1H well in our Marquis area, the well was returned to production with an initial 24-hour production rate of 215 BOE/D. While we continue to monitor production in the Lower Eagle Ford section of the Sante-area wells, we plan to shift appraisal focus to other horizons, including the Upper Eagle Ford and Austin Chalk in the greater Sante area. Our expectation for additional resource potential from these other horizons continues to grow as we better understand the area."
"In our Wycross area, we initiated a multi-well pad program in the first quarter and have already realized cost improvements with drilling costs of approximately $3.0 million versus the previous operator's average cost of $3.3 million. The last well on this pad is currently drilling the curve on its 5th day and is expected to have a drilling cost of below $3 million."
Tuscaloosa Marine Shale Operations Update
"We expect to spud our first operated TMS well, the Dry Fork East #2H, in Wilkinson County, Mississippi during May. Our plan is to appraise the acreage by drilling a pilot hole, taking extensive cores and running additional logs as we build our knowledge base in this area. This well has a planned 7,000 foot lateral. We expect to use the rig that will drill the Dry Fork East well continuously this year, which should enable us to spud four gross operated wells in addition to participating in 10 -15 gross non-operated wells."
"We are pleased with recent results coming from the TMS play. We anticipate having non-operated interests in up to five wells that are either drilling now or are expected to spud during the second quarter – not including the Lawson 25H-1 well, which has seen very good sustained production rates from a short, 3,800-foot lateral with only 14 frac stages. The next several months should see a steadily increasing number of TMS well results from multiple operators."
Estimated First Quarter 2014 Production Volumes and Operational Update
Estimated total production for the first quarter of 2014 was approximately 1,691 MBOE (18,784 BOE/D). Crude oil represented 72% of the total production stream, natural gas represented 13% and NGLs represented 15%.
Three Months Ended March 31,
Total Production Volumes
Natural Gas (MMcf)
Total Production Volumes (MBOE)
Average Daily Production Volumes
Natural Gas (Mcf/d)
Total Production Volumes (BOE/D)
As detailed in the table below, Sanchez Energy currently has six gross rigs (five operated and one non-operated rig) running across its Eagle Ford areas with 216 gross producing wells and 13 gross wells in various stages of completion. In addition, one gross rig is currently running in the TMS in which Sanchez Energy has a non-operated interest.
Wells Waiting /
TMS / Other
About Sanchez Energy Corporation
Sanchez Energy Corporation is an independent exploration and production company focused on the acquisition and development of unconventional resources in the onshore U.S. Gulf Coast, with a current focus on the Eagle Ford Shale where we have assembled approximately 120,000 net acres. The Company also has approximately 40,000 net acres targeting the Tuscaloosa Marine Shale. Sanchez Energy plans to hold its first quarter 2014 earnings conference call on Thursday, May 8, 2014 at 2:00 p.m. EDT (1:00 p.m. CDT). For more information about Sanchez Energy Corporation, please visit our website: www.sanchezenergycorp.com
Forward Looking Statements
This press release contains, and our officers and representatives may from time to time make, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that Sanchez Energy expects, believes or anticipates will or may occur in the future are forward-looking statements, including statements relating to successfully closing our announced acquisitions, the anticipated benefits of our acquisitions, successfully obtaining the financing for any proposed acquisitions and other aspects of any proposed acquisitions. These statements are based on certain assumptions made by the company based on management's experience, perception of historical trends and technical analyses, current conditions, anticipated future developments and other factors believed to be appropriate and reasonable by management. When used in this press release, the words "will," "potential," "believe," "estimate," "intend," "expect," "may," "should," "anticipate," "could," "plan," "predict," "project," "profile," "model," or their negatives, other similar expressions or the statements that include those words, are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words.
Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of Sanchez Energy, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements, including, but not limited to failure of acquired assets to produce as anticipated, failure to successfully integrate acquired assets, failure to continue to produce oil and gas at historical rates, costs of operations, delays, and any other difficulties related to producing oil or gas, the price of oil or gas, marketing and sales of produced oil and gas, estimates made in evaluating reserves, competition, general economic conditions and the ability to manage and continue growth and other factors described in Sanchez Energy's Annual Report for the fiscal year ended December 31, 2013 and any updates to those risk factors set forth in Sanchez Energy's Quarterly Reports on Form 10-Q. Further information on such assumptions, risks and uncertainties is available in Sanchez Energy's filings with the Securities and Exchange Commission ("SEC"). Sanchez Energy's filings with the SEC are available on its website at www.sanchezenergycorp.com and on the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events anticipated by Sanchez Energy's forward-looking statements may not occur, and, if any of such events do occur, Sanchez Energy may not have correctly anticipated the timing of their occurrence or the extent of their impact on its actual results. Accordingly, you should not place any undue reliance on any of Sanchez Energy's forward-looking statements. Any forward-looking statement speaks only as of the date on which such statement is made and Sanchez Energy undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.
Cautionary Note to U.S. Investors
The SEC permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable and possible reserves. We may use certain terms in our press releases, such as net resource potential and other variations of the foregoing terms that the SEC's guidelines strictly prohibit us from including in filings with the SEC. U.S. Investors are urged to consider closely the reserves disclosures in our filings with the SEC available on our website at www.sanchezenergycorp.com and the SEC's website at www.sec.gov. You can also obtain this information from the SEC by calling its general information line at 1-800-SEC-0330.
Michael G. Long
Executive Vice President and Chief Financial Officer
Sanchez Energy Corporation
Gleeson Van Riet
SVP, Capital Markets & IR
Sanchez Energy Corporation
SOURCE Sanchez Energy Corporation