Gulfport Energy Second Quarter Results Show That Company is All-In On Utica Shale

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From a Gulfport Energy press release:
Recent Operational Highlights
  • Gulfport recently secured firm transportation agreements with ten year terms on both Dominion East Ohio ("DEO") and Dominion Transmission Incorporated ("DTI").
  • Gulfport's Boy Scout 2-33H well was recently placed on production in the Utica Shale. The Boy Scout 2-33H produced at an average seven-day sales rate of 747 barrels of condensate per day, 2.1 MMCF of natural gas per day and 298 barrels of NGLs per day assuming full ethane recovery and a natural gas shrink of 25%, or 1,308 BOEPD.
  • Gulfport's Boy Scout 4-33H well was recently placed on production in the Utica Shale. The Boy Scout 4-33H produced at an average seven-day sales rate of 519 barrels of condensate per day, 2.0 MMCF of natural gas per day and 264 barrels of NGLs per day assuming full ethane recovery and a natural gas shrink of 22%, or 1,043 BOEPD.
  • Gulfport spud a total of nine wells in Southern Louisiana during the second quarter of 2013, completing five of the wells as productive. One well was waiting on completion and three wells were still being drilled at the end of the quarter.
  • Grizzly Oil Sand ULC ("Grizzly"), in which Gulfport owns a 24.9% interest, expects to have first steam in the coming months followed by first production in the fourth quarter of 2013 at its first SAGD facility at Algar Lake.
  • Nine rigs are currently active in Gulfport's three core operating areas, with seven horizontal rigs in the Utica, one rig drilling atHackberry and one rig drilling at WCBB.
Operational Update
Utica Shale
Gulfport has executed firm transportation agreements with ten year terms on both DEO and DTI for up to 100,000 Dth/day of residue originating at the MarkWest Energy Cadiz gas processing facility for delivery to ANR Pipeline at Lebanon, Ohio via DTI's interconnection with DEO at Harlem Springs, Ohio, effective immediately. This will allow Gulfport access to Midwest natural gas markets in Wisconsin, Illinois,Indiana and Michigan. In November of 2014, an additional 150,000 Dth/day of firm transportation will be available for delivery to Texas Eastern and Rockies Express pipelines at Clarington, Ohio and to DTI at Mullett, Ohio.
In the Utica Shale, Gulfport spud sixteen gross (11.78 net) wells during the second quarter of 2013. At the end of the second quarter, Gulfport had four gross wells waiting on completion, three gross wells being drilled by horizontal rigs and nine gross wells with their vertical sections completed and waiting on a horizontal rig. At present, Gulfport has seven horizontal rigs drilling on the eighteenth through twenty-fourth gross wells of 2013 in the play.
Gulfport recently began flowing into sales pipelines its Boy Scout 2-33H and Boy Scout 4-33H wells in the Utica Shale. The Boy Scout 2-33H was drilled to a true vertical depth of 7,677 feet with a 8,511 foot horizontal lateral. Following a 60-day resting period, the well was placed on production at an average gross seven-day sales rate of 747 barrels of condensate per day and 2.1 MMCF of natural gas per day. The well produced at a flowing tubing pressure of 1,505 psi. Based upon composition analysis, the gas being produced is 1,310 BTU gas. Assuming full ethane recovery, the composition above is expected to produce an additional 142 barrels of NGLs per MMCF of natural gas and result in a natural gas shrink of 25%. In ethane rejection mode, the composition is expected to yield 84 barrels of NGLs per MMCF of natural gas and result in a natural gas shrink of 17%.
The Boy Scout 4-33H was drilled to a true vertical depth of 7,874 feet with a 5,848 foot horizontal lateral. Following a 60-day resting period, the well was placed on production at an average gross seven-day sales rate of 519 barrels of condensate per day and 2.0 MMCF of natural gas per day. The well produced at a flowing tubing pressure of 1,398 psi. Based upon composition analysis, the gas being produced is 1,289 BTU rich gas. Assuming full ethane recovery, the composition above is expected to produce an additional 132 barrels of NGLs per MMCF of natural gas and result in a natural gas shrink of 22%. In ethane rejection mode, the composition is expected to yield 58 barrels of NGLs per MMCF of natural gas and result in a natural gas shrink of 10%.
Gulfport ended the second quarter of 2013 with thirteen gross wells producing. Subsequent to the second quarter, Gulfport has begun flowing an additional two gross wells into sales pipelines. Gulfport currently expects to begin flowing a total of four to six gross wells during the third quarter of 2013 and twenty-five to thirty gross wells during the fourth quarter of 2013.
Read the entire release by clicking here.

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