HOUSTON, Oct. 11, 2017 /PRNewswire/ -- Gastar Exploration
Inc. (NYSE MKT: GST) ("Gastar" or the "Company") today updated its
guidance for third quarter and full year 2017 production.
Gastar expects to report third quarter 2017 production in the
range of 6,100-6,300 barrels of oil equivalent ("Boe") per day
("Boe/d"), down from prior disclosed guidance of 6,300-6,800 Boe/d,
and full year 2017 production in the range of 6,000-6,400 Boe/d,
down from prior disclosed guidance of 6,200-6,800 Boe/d, with no
change in liquids percentage guidance for either period. The
change in production guidance is the result of operational
challenges that Gastar believes have been resolved.
J. Russell Porter, Gastar's
President and CEO, commented, "We continue to be pleased with
recent results that our new COO and his team have produced and look
forward to a more comprehensive operational update on our third
quarter earnings call."
Hedging Activity
Over the last month, Gastar has continued to add to its crude
oil hedge position through year-end 2017 and 2018. As of
September 30, 2017, the following
crude derivative transactions were outstanding with the associated
notional volumes and weighted average underlying hedge prices:
|
|
|
|
Average
|
|
Total
of
|
|
Base
|
|
|
|
|
|
|
|
|
Derivative
|
|
Daily
|
|
Notional
|
|
Fixed
|
|
Floor
|
|
Short
|
|
Ceiling
|
Settlement
Period
|
|
Instrument
|
|
Volume
(1)
|
|
Volume
|
|
Price
|
|
(Long)
|
|
Put
|
|
(Short)
|
(in
Bbls)
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
October -
December
|
|
3-way
|
|
280
|
|
25,760
|
|
|
|
$
80.00
|
|
$
65.00
|
|
$
97.25
|
October -
December
|
|
3-way
|
|
650
|
|
19,900
|
|
|
|
$
80.00
|
|
$
60.00
|
|
$
98.70
|
October -
December
|
|
Put
Spread
|
|
500
|
|
46,000
|
|
|
|
$
82.00
|
|
$
62.00
|
|
|
October -
December
|
|
Swaps
|
|
2,550
|
|
213,250
|
|
$
51.50
|
|
|
|
|
|
|
October -
December
|
|
Collar
|
|
200
|
|
18,400
|
|
|
|
$
45.00
|
|
|
|
$
53.50
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January -
August
|
|
Put
Spread
|
|
425
|
|
103,275
|
|
|
|
$
80.00
|
|
$
60.00
|
|
|
January -
June
|
|
Swaps
|
|
600
|
|
108,600
|
|
$
51.20
|
|
|
|
|
|
|
July -
September
|
|
Swaps
|
|
500
|
|
46,000
|
|
$
51.20
|
|
|
|
|
|
|
October -
December
|
|
Swaps
|
|
600
|
|
55,200
|
|
$
51.20
|
|
|
|
|
|
|
January -
June
|
|
Swaps
|
|
200
|
|
36,200
|
|
$
50.11
|
|
|
|
|
|
|
January -
December
|
|
3-way
|
|
500
|
|
182,500
|
|
|
|
$
50.00
|
|
$
40.00
|
|
$
61.60
|
January -
March
|
|
3-way
|
|
1,800
|
|
162,000
|
|
|
|
$
47.50
|
|
$
37.50
|
|
$
57.85
|
April -
June
|
|
3-way
|
|
1,700
|
|
154,700
|
|
|
|
$
47.50
|
|
$
37.50
|
|
$
57.85
|
July -
September
|
|
3-way
|
|
1,600
|
|
147,200
|
|
|
|
$
47.50
|
|
$
37.50
|
|
$
57.85
|
October -
December
|
|
3-way
|
|
1,700
|
|
156,400
|
|
|
|
$
47.50
|
|
$
37.50
|
|
$
57.85
|
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January -
September
|
|
Swaps
|
|
700
|
|
191,100
|
|
$
50.40
|
|
|
|
|
|
|
October -
December
|
|
Swaps
|
|
600
|
|
55,200
|
|
$
50.40
|
|
|
|
|
|
|
January -
September
|
|
3-way
|
|
2,000
|
|
546,000
|
|
|
|
$
47.50
|
|
$
37.50
|
|
$
59.70
|
October -
December
|
|
3-way
|
|
1,900
|
|
174,800
|
|
|
|
$
47.50
|
|
$
37.50
|
|
$
59.70
|
|
|
(1)
|
Crude volumes hedged
include oil, condensate, and certain components of NGLs
production.
|
There were no recent changes in the Company's gas hedging
positions.
About Gastar Exploration
Gastar Exploration Inc. is a pure play Mid-Continent independent
energy company engaged in the exploration, development and
production of oil, condensate, natural gas and natural gas liquids.
Gastar's principal business activities include the identification,
acquisition and subsequent exploration and development of oil and
natural gas properties with an emphasis on unconventional reserves,
such as shale resource plays. Gastar holds a concentrated acreage
position in what is believed to be the core of the STACK Play, an
area of central Oklahoma which is
home to multiple oil and natural gas-rich reservoirs including the
Meramec, Oswego, Osage,
Woodford and Hunton formations.
For more information, visit Gastar's website at www.gastar.com.
Forward Looking Statements
This news release includes "forward looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Forward looking statements include "guidance" and
give our current expectations, opinion, belief or forecasts of
future events and performance. A statement identified by the
use of forward looking words including "may," "expects,"
"projects," "anticipates," "plans," "believes," "estimate," "will,"
"should," and certain of the other foregoing statements may be
deemed forward-looking statements. Although Gastar believes
that the expectations reflected in such forward-looking statements
are reasonable, these statements involve risks and uncertainties
that may cause actual future activities and results to be
materially different from those suggested or described in this news
release. These include risks inherent in natural gas and oil
drilling and production activities, including risks with respect to
continued low or further declining prices for natural gas and oil
that could result in further downward revisions to the value of
proved reserves or otherwise cause Gastar to further delay or
suspend planned drilling and completion operations or reduce
production levels which would adversely impact cash flow; risks
relating to the availability of capital to fund drilling operations
that can be adversely affected by adverse drilling results,
production declines and continued low or further declining prices
for natural gas and oil; risks of fire, explosion, blowouts, pipe
failure, casing collapse, unusual or unexpected formation
pressures, environmental hazards, and other operating and
production risks, which may temporarily or permanently reduce
production or cause initial production or test results to not be
indicative of future well performance or delay the timing of sales
or completion of drilling operations; delays in receipt of drilling
permits; risks relating to unexpected adverse developments in the
status of properties; risks relating to the absence or delay in
receipt of government approvals or third-party consents; risks
relating to our ability to integrate acquired assets with ours and
to realize the anticipated benefits from such acquisitions; and
other risks described in Gastar's Annual Report on Form 10-K and
other filings with the SEC, available at the SEC's website at
www.sec.gov. Our actual sales production rates can vary
considerably from tested initial production rates depending upon
completion and production techniques and our primary areas of
operations are subject to natural steep decline rates. By issuing
forward looking statements based on current expectations, opinions,
views or beliefs, Gastar has no obligation and, except as required
by law, is not undertaking any obligation, to update or revise
these statements or provide any other information relating to such
statements.
Targeted expectations and guidance for the third quarter and
full-year of 2017 are based upon the current 2017 planned capital
expenditures budget, which may be subject to revision and
reevaluation dependent upon future developments, including changes
in commodity prices, drilling results, our liquidity position,
availability of crews, supplies and production capacity, weather
delays and significant changes in drilling costs.
Unless otherwise stated herein, equivalent volumes of production
are based upon an energy equivalent ratio of six Mcf of natural gas
to each barrel of liquids (oil, condensate and NGLs), which ratio
is not reflective of relative value. Our NGLs are sold as
part of our wet gas subject to an incremental NGLs pricing formula
based upon a percentage of NGLs extracted from our wet gas
production. Our reported production volumes reflect
incremental post-processing NGLs volumes and residual gas volumes
with which we are credited under our sales contracts.
Contacts:
Gastar Exploration Inc.
Michael A. Gerlich, Chief Financial
Officer
713-739-1800 / mgerlich@gastar.com
Investor Relations Counsel:
Lisa Elliott, Dennard Lascar Investor Relations:
713-529-6600 / lelliott@DennardLascar.com
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SOURCE Gastar Exploration Inc.