HOUSTON, Feb. 2, 2015 /PRNewswire/ -- Sanchez Energy Corporation (NYSE: SN) ("Sanchez Energy" or the "Company"), today provided an update on its fourth quarter and full year 2014 operations and year-end 2014 reserves.
- Sanchez Energy reported fourth quarter 2014 production of approximately 4,039 MBOE, an increase of 14% over the third quarter of 2014 and an increase of 133% compared to the same period a year ago. Daily average production was 43,897 BOE/D, at the high end of the fourth quarter 2014 guidance range of 40,000 – 44,000 BOE/D. Full year 2014 production was approximately 11,141 MBOE (30,523 BOE/D), an increase of 188% over 2013.
- Year-end 2014 proved reserves were 134.8 MMBOE, an increase of 129% compared to year-end 2013
- Current production of approximately 43,000 BOE/D with 46 gross wells in various stages of completion
- First quarter and full year 2015 production guidance of 40,000-44,000 BOE/D is reaffirmed
Tony Sanchez, III, President and Chief Executive Officer of Sanchez Energy, commented: "We reached several milestones in 2014 including achieving the scale to continue our proven ability to deliver cost and operating efficiencies; material additions to our high quality, long-term inventory of drilling locations; and a solid balance sheet with excellent liquidity. We significantly grew our production and reserves as a result of executing our 2014 capital plan, our manufacturing process strategy, and successfully integrating our Catarina acquisition. We reacted early and decisively in response to the fall in oil prices, cutting our capital spending plans, and reducing our drilling and completion costs so that we are in a position to weather and thrive in this uncertain environment.
"As a result of continued increases in drilling efficiencies, completion optimizations, and realized unit cost reductions from the service sector, we are already achieving our targeted $5 million Catarina well costs. We expect continued cost saving through efficiencies in the coming months. These cost savings, coupled with higher well performance than initially expected, are leading to high rates of return in Catarina despite the lower commodity price environment."
Estimated Fourth Quarter and Full Year 2014 Production Volumes and Year-End 2014 Reserves
Estimated total production for the fourth quarter of 2014 was approximately 4,039 MBOE (43,897 BOE/D). Crude oil represented 45% of the total production stream, NGLs represented 28%, and natural gas represented 27%. Estimated total production for the full year 2014 was 11,141 MBOE (30,523 BOE/D). Crude oil represented 55% of the total production stream, NGLs represented 23%, and natural gas represented 22%.
Three Months Ended December 31,
Year Ended December 31,
Total Production Volumes
Natural Gas (MMcf)
Total Production Volumes (MBOE)
Average Daily Production Volumes
Natural Gas (Mcf/d)
Total Production Volumes (BOE/D)
Sanchez Energy announced that proved reserves increased to 134.8 MMBOE at December 31, 2014, up 129% from 58.7 MMBOE at December 31, 2013. Crude oil constituted 48% (74% crude oil and NGLs) of Sanchez Energy's proved reserves at December 31, 2014, and 52% of the Company's proved reserves were classified as proved undeveloped at December 31, 2014 as compared to 58% at December 31, 2013.
Note: The Company's estimated reserves were prepared by its independent reservoir engineering firm Ryder Scott & Company, L.P.
The Company has been focusing its resources on Catarina where recent efficiencies and unit cost reductions have led to substantial total well cost savings. Drilling durations have decreased from an average of 15 days per well (spud to TD) to an average of 9 days per well on the last 3 pads drilled. Completions efficiencies have also increased approximately 15% despite maintaining the same stage spacing from prior pads and increases in proppant levels pumped per lateral foot. Sanchez Energy's 2015 drilling plan calls for 4 gross (3.5 net) rigs focusing on Catarina and Palmetto in the Eagle Ford and 0.25 gross and net rigs in the TMS. As detailed in the table below, Sanchez Energy currently has 46 gross wells in various stages of completion.
Wells Waiting /
Cotulla / Wycross
TMS / Other
First Quarter 2015 Operating and Financial Guidance
Sanchez Energy maintains its recently issued first quarter and full year 2015 production and financial guidance. Full year 2015 average production is expected to increase approximately 38% over 2014 average production at the mid-point of the guidance range.
Production Guidance (BOE/D)
40,000 - 44,000
40,000 - 44,000
% Oil / NGLs / Gas
46% / 27% / 27%
42% / 29% / 29%
Operating Cost & Expense Guidance ($/BOE)
Oil & Natural Gas Production Expenses
$9.00 - $10.00
$9.00 - $10.00
Production & Ad Valorem Taxes
$2.00 - $3.00
$2.00 - $3.00
$3.00 - $3.50
$3.00 - $3.50
Preferred Stock Dividends & Interest Expense
$8.40 - $9.25
$8.30 - $9.10
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 in South Texas, where it has assembled approximately 226,000 net acres, and the Tuscaloosa Marine Shale. For more information about Sanchez Energy Corporation, please visit its 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 related to our production and well results. 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," "strategy," "future," 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. These risks and uncertainties include, but are not limited to, the extent to which Sanchez Energy is successful in its efforts to acquire or discover additional reserves, its ability 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, the extent and effect of any of its hedging activities, its success marketing and selling produced oil and gas, estimates made in evaluating reserves, competition, general economic conditions, the future availability and cost of employees and other personnel, facilities, equipment, materials and services, its ability to manage and continue growth and other factors as further described in Sanchez Energy's Annual Report for the most recently completed fiscal year ended December 31 and any updates to those risk factors set forth in Sanchez Energy's Quarterly Reports on Form 10-Q. No representation or warranty is made as to future performance. 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 & Investor Relations
Sanchez Energy Corporation
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SOURCE Sanchez Energy Corporation