Jan 28 2011
EQT Corporation (NYSE: EQT) today reported year-end 2010 total natural gas proved reserves of 5,220 Bcfe.
This represents a 28% net increase over the 4,068 Bcfe the company reported last year. Proved reserves increased in the Marcellus shale play as a result of wells drilled in 2010, continued improvement in the estimated ultimate recovery (EUR) per Marcellus well, and an increase in the projected number of Marcellus wells to be drilled over the next five years. Partially offsetting the Marcellus reserve additions was a reduction of Huron and CBM/other proved undeveloped reserves based on an assumption of reduced investments in those plays over the next five years. The net increase of reserves before production totaled 1,291 Bcfe. This increase represents a 928% reserve replacement ratio and resulted from investments of $902 million, for a finding and development cost of $0.70 per Mcfe.
EQT estimates year-end 2010 total natural gas reserves, including proved, probable and possible reserve categories (3P), at 21.2 Tcfe, a 70% net increase over 2009. This increase was driven mainly by the success of the company's Marcellus and, to a lesser extent, Huron horizontal drilling programs. Probable reserves increased by 52% to 8.5 Tcfe.
The company has also made an assessment of its total resource potential, including 3P reserves and its estimate of the potential resources beyond the 3P totals. This resource potential is estimated to be:
Reserve Replacement Calculations
Reserve replacement ratio is the sum of the net increase of reserves before production, divided by production. The finding and development cost is the total cost incurred related to natural gas and oil production activities calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification 932 (ASC 932) less property acquisition costs for unproved properties, divided by the net increase of reserves before production.
Source: EQT Corporation