Summary
EXPAND ENERGY Corp (EXE) filed an 8-K on March 5, 2019, providing an update on the assets of its subsidiary, WildHorse. The report details WildHorse's oil, natural gas, and NGL operations primarily concentrated in Southeast Texas, specifically targeting the Eagle Ford Shale and Austin Chalk Trend. Key information includes the company's estimated proved reserves as of December 31, 2018, which stand at 285,266 MBbls of oil, 378,173 MMcf of natural gas, and 57,755 MBbls of NGLs, translating to a total of 406,050 MBoe. The filing also presents historical production, revenue, and cost data for the past three years, indicating significant growth in production volumes and revenue in 2018 compared to 2017 and 2016, driven by increased activity in the Eagle Ford Shale. Furthermore, the report clarifies the methodology behind reserve estimations, emphasizing reliance on third-party engineering firm Cawley, Gillespie and Associates, Inc. (CG&A) and adherence to industry standards. It includes a reconciliation of PV-10 to the Standardized Measure of discounted future net cash flows, highlighting WildHorse's substantial PV-10 of $5,089,918 thousand as of December 31, 2018. The company also provides details on its productive wells and acreage, with a significant portion of its net Eagle Ford acreage held by production. Investors should note the upcoming acreage expirations in the Eagle Ford Shale and the company's intention to extend these leases through development and payments.
Key Highlights
- 1WildHorse holds significant proved reserves as of December 31, 2018: 285,266 MBbls oil, 378,173 MMcf natural gas, and 57,755 MBbls NGLs, totaling 406,050 MBoe.
- 2The company's primary operational focus is on the Eagle Ford Shale and Austin Chalk Trend in Southeast Texas.
- 3Production volumes and average sales prices saw a notable increase in 2018, particularly for oil in the Eagle Ford Shale, with 12,559 MBbls produced at an average price of $67.02/Bbl.
- 4WildHorse's PV-10 of proved reserves was $5,089,918 thousand as of December 31, 2018, indicating substantial pre-tax discounted future net cash flows.
- 5The company reported 932.6 net oil wells and 54.3 net natural gas wells in its Eagle Ford Acreage as of December 31, 2018.
- 6A significant portion of WildHorse's net Eagle Ford acreage (approximately 74%) was held by production as of December 31, 2018.
- 7Approximately 31,031 net undeveloped acres in the Eagle Ford region are set to expire in 2019, with plans to extend them through development and payments.