Natural gas company cuts back on drilling, production
A State College-based natural gas driller said it will cut back on drilling and will keep its production at about the same level as 2015 until prices go up again.
Eclipse Resources Corp. (NYSE: ECR) said it would spend about $33 million to drill and complete one well in the first quarter but has stopped other drilling and completion activity until natural gas prices go up again. It’s also planning to cut production to about 200 million cubic feet of production daily, around the same level of its average daily production of 206 million cubic feet of production in 2015. It will be a drop from the fourth-quarter average of 268 million cubic feet daily.
Eclipse is also adjusting its mix between natural gas, liquids and oil but it, unlike other drillers, hasn’t announced a 2016 capital budget yet.
“As natural gas prices hover around 15-year lows, I believe we are making the financially prudent decision regarding our significantly decreased capital spending plan and the curtailment of our production,” Eclipse Chairman, President and CEO Benjamin Hulburt said in a statement. “Although we are not setting a capital budget for the year at this time, we currently anticipate that our ultimate capital plan, absent a significant increase in commodity prices, will be constructed with the objective of ending 2016 with a cash balance and no new debt drawn.