Magnum Hunter Resources Discloses 2013 Drilling Plans to Begin
Magnum Hunter Resources Discloses 2013 Drilling Plans to Begin Developing Its Substantial Utica Leasehold Position in Ohio
HOUSTON, TX -- (Marketwire) -- 01/22/13 -- Magnum Hunter Resources Corporation (NYSE: MHR) (NYSE MKT: MHR.PRC) (NYSE MKT: MHR.PRD) (NYSE MKT: MHR.PRE) (the "Company") announced today that it intends to drill a minimum of four (4) Utica test wells in Ohio this year. If results are similar to those experienced by offset Operators in the area, then further development on the leasehold position is planned later in the year.
The Company through its wholly-owned subsidiary, Triad Hunter, LLC ("Triad Hunter"), is currently building its first Utica Pad in Washington County, Ohio. The Farley Pad is designed for potentially drilling four (4) horizontal wells to the Utica formation. The first well will be a vertical pilot for extensive logging and coring, then plans are to plug back and drill an approximately 6,000 foot lateral in the Point Pleasant portion of the Utica. The well will then be fracture stimulated and tested. Plans are to spud this first well in late February or early March. Triad Hunter has mineral rights on about 107,000 gross acres (81,000 net acres) of Utica potential, largely held by production. About 41,000 gross acres (26,514 net acres) are deemed to be in the wet gas window.
Three (3) additional Utica/Point Pleasant wells are planned in conjunction with the previously announced Joint Operating Agreement with Eclipse Resources I, LP, to form three drilling Units in Monroe County, Ohio. Production from these Utica wells, along with the twelve (12) "Magnum Rich" Marcellus wells will be gathered and delivered to the MarkWest processing facility at Mobley, West Virginia. This will be accomplished by laying three separate pipelines in the same right-of-way. One for wet gas, one for dry gas, and one for produced liquids to be separated at a central facility.
Anticipating favorable results, the Company has already commissioned engineering drawings and Unit preparation on two (2) additional Utica Pads. The Crooked Tree Pad located in Noble County, Ohio is being designed around the potential for ten horizontal wells, five updip, and five downdip. The Woodchopper Pad located in Washington County, Ohio is being designed for four Point Pleasant horizontal wells.
Magnum Hunter Management Comments
Mr. James W. Denny, III, President of Triad Hunter, commented, "We are very excited to begin accelerating our testing program in the Utica formation located in Ohio. Development of this exciting and highly productive unconventional play could have significant impact to our Company. As nearby offset operators results have validated our geologic interpretation, we are confident that our leasehold position will yield anticipated results. Additionally, we have recently drilled and cased two new Marcellus wells on our Ormet acreage located in Monroe County, Ohio adjacent to leases where Utica potential exists. We are planning to complete these new liquids rich Marcellus wells this summer when Eureka Hunter, our midstream division, has completed the necessary infrastructure."
About Magnum Hunter Resources Corporation
Magnum Hunter Resources Corporation and subsidiaries are a Houston, Texas-based independent exploration and production company engaged in the acquisition, development and production of crude oil, natural gas and natural gas liquids, primarily in the states of West Virginia, Kentucky, Ohio, Texas and North Dakota, and Saskatchewan, Canada. The Company is presently active in five of the most prolific unconventional shale resource plays in North America, namely the Marcellus Shale, Utica Shale, Eagle Ford Shale, Pearsall Shale and Williston Basin/Bakken Shale.
For more information about Magnum Hunter, please visit www.magnumhunterresources.com.
The statements and information contained in this press release that are not statements of historical fact, including any estimates and assumptions contained herein, are "forward looking statements" as defined in Section 27A of the Securities Act of 1933, as amended, referred to as the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, referred to as the Exchange Act. These forward-looking statements include, among others, statements, estimates and assumptions relating to our business and growth strategies, our oil and gas reserve estimates, our ability to successfully and economically explore for and develop oil and gas resources, our exploration and development prospects, future inventories, projects and programs, expectations relating to availability and costs of drilling rigs and field services, anticipated trends in our business or industry, our future results of operations, our liquidity and ability to finance our exploration and development activities and our midstream activities, market conditions in the oil and gas industry and the impact of environmental and other governmental regulation. In addition, with respect to any pending acquisitions described herein, forward-looking statements include, but are not limited to, statements regarding the expected timing of the completion of the proposed transactions; the ability to complete the proposed transactions considering the various closing conditions; the benefits of such transactions and their impact on the Company's business; and any statements of assumptions underlying any of the foregoing. In addition, if and when any proposed transaction is consummated, there will be risks and uncertainties related to the Company's ability to successfully integrate the operations and employees of the Company and the acquired business. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "could," "should," "expect," "intend," "estimate," "anticipate," "believe," "project," "pursue," "plan" or "continue" or the negative thereof or variations thereon or similar terminology.
These forward-looking statements are subject to numerous assumptions, risks, and uncertainties. Factors that may cause our actual results, performance, or achievements to be materially different from those anticipated in forward-looking statements include, among others, the following: adverse economic conditions in the United States, Canada and globally; difficult and adverse conditions in the domestic and global capital and credit markets; changes in domestic and global demand for oil and natural gas; volatility in the prices we receive for our oil and natural gas; the effects of government regulation, permitting and other legal requirements; future developments with respect to the quality of our properties, including, among other things, the existence of reserves in economic quantities; uncertainties about the estimates of our oil and natural gas reserves; our ability to increase our production and therefore our oil and natural gas income through exploration and development; our ability to successfully apply horizontal drilling techniques; the effects of increased federal and state regulation, including regulation of the environmental aspects, of hydraulic fracturing; the number of well locations to be drilled, the cost to drill and the time frame within which they will be drilled; drilling and operating risks; the availability of equipment, such as drilling rigs and transportation pipelines; changes in our drilling plans and related budgets; regulatory, environmental and land management issues, and demand for gas gathering services, relating to our midstream operations; and the adequacy of our capital resources and liquidity including, but not limited to, access to additional borrowing capacity.
These factors are in addition to the risks described in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of the Company's 2011 annual report on Form 10-K, as amended, filed with the Securities and Exchange Commission, which we refer to as the SEC. Most of these factors are difficult to anticipate and beyond our control. Because forward-looking statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such statements. You are cautioned not to place undue reliance on forward-looking statements contained herein, which speak only as of the date of this document. Other unknown or unpredictable factors may cause actual results to differ materially from those projected by the forward-looking statements. Unless otherwise required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. We urge readers to review and consider disclosures we make in our reports that discuss factors germane to our business. See in particular our reports on Forms 10-K, 10-Q and 8-K subsequently filed from time to time with the SEC. All forward-looking statements attributable to us are expressly qualified in their entirety by these cautionary statements.
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