Halcon Resources Announces Preliminary First Quarter 2015 Production Results and Provides Additional Updates
April 21 2015 - 7:28AM
Well Costs Continue to Decline in Core Plays New
Company Record 5,248 Boe/d IP Rate in Williston Basin
Halcón Resources Corporation (NYSE:HK) ("Halcón" or the "Company")
today announced preliminary first quarter 2015 production results
and provided additional updates.
Preliminary First Quarter 2015 Production
Results
Halcón expects to report production for the three months ended
March 31, 2015 of 42,500 – 43,500 barrels of oil equivalent per day
(Boe/d). First quarter production is estimated to be ~81% oil, ~8%
NGLs and ~11% natural gas.
Impairment Estimate
The Company estimates that it will record a non-cash pre-tax
full cost ceiling impairment charge of $450 - $650 million in the
first quarter of 2015.
Recent Developments
Halcón expects the following modifications to be made to its
senior secured revolving credit facility, subject to the
satisfaction of certain terms and conditions:
- Removal of the interest coverage ratio covenant with the
institution of a total secured leverage ratio covenant of
2.75x
- Reduction of the borrowing base to $900 million from $1.05
billion
The Company is also seeking to extend the maturity of its senior
secured revolving credit facility to August 1, 2019; however, there
is no assurance that the extension will be available to Halcón on
acceptable terms.
Operational Update
The Company is currently operating three rigs across its
holdings and currently has 23 wells being completed or waiting on
completion. Halcón continues to be focused on reducing costs in the
current commodity price environment.
Bakken/Three Forks
The Company operated an average of two rigs in the Williston
Basin during the quarter. The following table contains detailed
first quarter 2015 operated well data related to Halcón's Williston
Basin assets:
|
|
Wells |
|
1Q15 vs. 4Q14 |
|
1Q15 vs. 4Q14 |
|
Wells |
Put Online |
Avg. IP |
Avg. IP Rate |
Avg. 30 Day |
Avg. 30 Day Rate |
|
Spud |
(POL) |
Rate (Boe/d) |
Variance |
Rate (Boe/d) |
Variance |
Fort Berthold |
|
|
|
|
|
|
Bakken/Three Forks |
7 |
6 |
3,522 |
+38.2% |
1,833 |
+38.8% |
Williams County |
|
|
|
|
|
|
Bakken |
0 |
1 |
1,977 |
NM |
NM |
NM |
The Company also participated in 22 non-operated wells with an
average working interest of approximately 1% during the
quarter. On average, Halcón-operated wells put online in the
Williston Basin continue to outperform the Company's 801 MBoe and
477 MBoe type curves for the Fort Berthold and Williams County
areas, respectively.
Downspacing continues to yield positive
results. Specifically, during the first quarter of 2015,
Halcón brought six Bakken wells online spaced 660' – 770' apart
drilled from a single pad with a cumulative IP rate of 21,131
Boe/d, one of which was a new Company record at 5,248 Boe/d.
Halcón has made significant progress negotiating lower costs
with its service providers and continues to modify its drilling and
completion techniques in an effort to improve recoveries and reduce
costs. The Company's estimated completed well costs have come
down approximately 30% compared to the fourth quarter 2014
average. The current authorization for expenditure (AFE) for
wells drilled on its acreage in the Fort Berthold area is averaging
approximately $8.0 million, which was previously Halcón's mid-year
2015 target. The Company anticipates well costs will trend
down by another 5 - 10% or more in this area by mid-year
2015.
Halcón continues to increase gas capture in the Williston Basin
and is currently selling approximately 83% of its gas
production.
The Company is the operator of 172 producing Bakken wells and 53
Three Forks wells. Halcón currently has 11 Bakken wells and 5
Three Forks wells being completed or waiting on completion on its
operated acreage.
"El Halcón" - East Texas Eagle Ford
The Company operated an average of one rig in El Halcón during
the first quarter. The following table contains detailed first
quarter 2015 operated well data related to Halcón's East Texas
Eagle Ford assets:
|
|
Wells |
|
1Q15 vs. 4Q14 |
|
1Q15 vs. 4Q14 |
|
Wells |
Put Online |
Avg. IP |
Avg. IP Rate |
Avg. 30 Day |
Avg. 30 Day Rate |
|
Spud |
(POL) |
Rate (Boe/d) |
Variance |
Rate (Boe/d) |
Variance |
El Halcón |
4 |
4 |
983 |
+47.6% |
830 |
+57.5% |
All four wells put online in the play during the quarter are
outperforming the Company's 452 MBoe type curve for the
area.
Halcón's current drilling program is designed to capture leases
and hold acreage. As a result of several cost reduction
initiatives, the current AFE is averaging approximately $7.5
million for a three-string well, which represents an improvement of
approximately 25% compared to the fourth quarter of 2014. The
Company anticipates well costs will trend down by another 5 - 15%
or more in this area by mid-year 2015. Halcón expects
completed well costs to decrease by up to an additional $1 million
per well once it transitions into development mode and pad
drilling.
There are currently 92 Company-operated East Texas Eagle Ford
wells producing and 4 Halcón-operated wells being completed or
waiting on completion.
Forward-Looking Statements
This release may contain 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. Statements that are not strictly historical
statements constitute forward-looking statements and may
often, but not always, be identified by the use of such
words such as "expects", "believes", "intends", "anticipates",
"plans", "estimates", "potential", "possible", or "probable"
or statements that certain actions, events or results "may",
"will", "should", or "could" be taken, occur or be
achieved. Additionally, improvements mentioned herein are not
necessarily indicative of future performance. Forward-looking
statements are based on current beliefs and
expectations and involve certain assumptions or
estimates that involve various risks and uncertainties
that could cause actual results to differ materially from
those reflected in the statements. These risks include, but are not
limited to, those set forth in the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 2014 and other filings
submitted by the Company to the U.S. Securities and Exchange
Commission ("SEC"), copies of which may be obtained from the
SEC's website at www.sec.gov or through the Company's
website at www.halconresources.com. Readers should not
place undue reliance on any such forward-looking statements, which
are made only as of the date hereof. The Company has no
duty, and assumes no obligation, to update forward-looking
statements as a result of new information, future events
or changes in the Company's expectations.
About Halcón Resources
Halcón Resources Corporation is an independent energy company
engaged in the acquisition, production, exploration and development
of onshore oil and natural gas properties in the United States.
CONTACT: Scott M. Zuehlke
VP, Investor Relations
Halcon Resources
(832) 538-0314
Halcon Resources (NYSE:HK)
Historical Stock Chart
From Mar 2024 to Apr 2024
Halcon Resources (NYSE:HK)
Historical Stock Chart
From Apr 2023 to Apr 2024