By OGJ editors
HOUSTON, Aug. 9 -- Williams Cos., Tulsa, Okla., said it could be producing more than 500 MMcfd of gas from the Marcellus shale by 2015 from its current 97,000-net-acre position.
Current production is 5-6 MMcfd as Williams assumes operations in the Rex Energy Co. joint venture, where 5 of the 12 wells drilled are still to come on line.
Management said Williams’ position is generally in Centre, Clearfield, and Susquehanna counties, Pa. However, the company just drilled one well in Westmoreland County that may be its best with a first 30-day average of 4.9 MMcfd of gas.
Williams is running a single rig in the play. It will add one fit-for-purpose rig this month and another in February 2011.
It plans to drill 100 Marcellus wells with eight rigs in 2011 and 200 wells with 14 rigs in 2012. Its acreage is in the play’s dry gas window, and 79,000 acres of the 97,000 are outside the Rex Energy JV.
Williams in July completed the acquisition from Alta Resources LLC and partners of 42,000 net acres in Susquehanna County for $513 million and purchased a 5% overriding royalty interest on 48,500 gross acres associated with the acquisition for $84 million, which reduces the royalty burden.
The company is completing the acquisition of 8,000 net acres in another northeastern Pennsylvania area it termed attractive. The two transactions are expected to add a combined 1.3 tcf equivalent of net reserves potential, and they more than doubled Williams’ Marcellus holding to 97,000 net acres at an average cost of less than $7,000/acre.
By 2013, the Marcellus should be the company’s second largest producing basin after the Piceance basin in Colorado. The company probably will add more Marcellus acreage and sees numerous opportunities in the play for all phases of its business, management said.