Seneca Resources Corporation Provides Marcellus Shale Joint Venture Update and Forecasts Future Marcellus Shale Production
July 14 2011 - 5:12PM
Business Wire
Seneca Resources Corporation (“Seneca”), a wholly owned
subsidiary of National Fuel Gas Company (NYSE: NFG) (“National
Fuel” or the “Company”), continues to explore a joint venture as a
vehicle to further accelerate the development of its Marcellus
Shale acreage. Seneca has received offers from several possible
joint venture partners and continues discussions about potential
deal terms with a few of those parties.
“In response to inquiries from our shareholders and industry
analysts, we felt it was important to provide an update on our
joint venture process,” said David F. Smith, Chairman and Chief
Executive Officer of National Fuel. “While we had initially
anticipated reaching a decision by the end of June, the varied, but
not directly comparable, offers we have received have carried this
process past this self-imposed deadline. While discussions are
ongoing, as we’ve said in the past, we will only move forward with
a transaction on terms that we believe add value to our
shareholders over and above the value that Seneca will likely
achieve through its currently planned operations. Seneca continues
to experience outstanding operational results and significant
production growth.”
As the Company enters its fiscal fourth quarter, Seneca is
providing an estimate of its likely Marcellus Shale production rate
at the end of fiscal years 2011 and 2012. “Our production rates
will be ramping up substantially in the last quarter of this fiscal
year as groups of new wells are brought on line,” stated Matthew D.
Cabell, President of Seneca. “We expect our net Marcellus
production rate to reach 150 million cubic feet (“MMcf”) per day by
September 30, 2011, and 240 MMcf per day by September 30, 2012,
with or without a joint venture partner.”
Seneca Resources Corporation, the exploration and production
segment of National Fuel Gas Company, explores for, develops, and
purchases natural gas and oil reserves in California and
Appalachia. Additional information about Seneca and National Fuel
Gas Company is available at www.nationalfuelgas.com or through the
Company’s investor information service at 1-800-334-2188.
Certain statements contained herein, including forecasted
production rates and statements that are identified by use of the
words “anticipates,” “estimates,” “expects,” “forecasts,”
“intends,” “plans,” “predicts,” “projects,” “believes,” “seeks,”
“will,” “may” and similar expressions, are “forward-looking
statements” as defined by the Private Securities Litigation Reform
Act of 1995. Forward-looking statements involve risks and
uncertainties, which could cause actual results or outcomes to
differ materially from those expressed in the forward-looking
statements. The Company’s expectations, beliefs and projections
contained herein are expressed in good faith and are believed to
have a reasonable basis, but there can be no assurance that such
expectations, beliefs or projections will result or be achieved or
accomplished. In addition to other factors, the following are
important factors that could cause actual results to differ
materially from those discussed in the forward-looking statements:
financial and economic conditions, including the availability of
credit, and occurrences affecting the Company’s ability to obtain
financing on acceptable terms for working capital, capital
expenditures and other investments, including any downgrades in the
Company’s credit ratings and changes in interest rates and other
capital market conditions; changes in economic conditions,
including global, national or regional recessions, and their effect
on the demand for, and customers’ ability to pay for, the Company’s
products and services; the creditworthiness or performance of the
Company’s key suppliers, customers and counterparties; economic
disruptions or uninsured losses resulting from terrorist
activities, acts of war, major accidents, fires, severe weather or
natural disasters; factors affecting the Company’s ability to
successfully identify, drill for and produce economically viable
natural gas and oil reserves, including among others geology, lease
availability, weather conditions, shortages, delays or
unavailability of equipment and services required in drilling
operations, insufficient gathering, processing and transportation
capacity, the need to obtain governmental approvals and permits,
and compliance with environmental laws and regulations; changes in
laws and regulations to which the Company is subject, including
those involving derivatives, taxes, safety, employment, climate
change, other environmental matters, and exploration and production
activities such as hydraulic fracturing; uncertainty of oil and gas
reserve estimates; significant differences between the Company’s
projected and actual production levels for natural gas or oil;
significant changes in market dynamics or competitive factors
affecting the Company’s ability to retain existing customers or
obtain new customers; changes in the availability and/or price of
natural gas or oil; impairments under the SEC’s full cost ceiling
test for natural gas and oil reserves; changes in the availability
and/or cost of derivative financial instruments; changes in price
differentials between similar quantities of oil or natural gas
having different quality, heating value, geographic location or
delivery date; changes in the projected profitability of pending or
potential projects, investments or transactions; significant
differences between the Company’s projected and actual capital
expenditures and operating expenses; delays or changes in costs or
plans with respect to Company projects or related projects of other
companies, including difficulties or delays in obtaining necessary
governmental approvals, permits or orders or in obtaining the
cooperation of interconnecting facility operators;
governmental/regulatory actions, initiatives and proceedings;
significant changes in the Company’s relationship with its
employees or contractors and the potential adverse effects if labor
disputes, grievances or shortages were to occur; or the cost and
effects of legal and administrative claims against the Company. The
Company disclaims any obligation to update any forward-looking
statements to reflect events or circumstances after the date
hereof.
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