Antero Resources Investing an Extra $126 Million in 2011 – Most of it for Marcellus Shale Drilling

The Antero Resources board of directors approved a $126 million increase in the company’s capital budget for 2011. Antero’s revised capital budget for 2011 is $685 million and includes $519 million for drilling and completion, $86 million for the construction of gathering pipelines and facilities and $80 million for leasehold acquisitions. The budget was revised to fund increased drilling in core areas in the Marcellus and Piceance, the expansion of gathering infrastructure in the Marcellus and the acquisition of additional leasehold opportunities in Antero’s core area in the Marcellus. The $126 million increase was allocated 53% to drilling, 35% to gathering pipeline expansion and 12% to leasehold.

Approximately 71% of the budget is allocated to the Marcellus Shale, 17% is allocated to the Piceance Basin and 12% is allocated to the Woodford Shale and Fayetteville Shale. Antero is currently operating five drilling rigs in the Marcellus Shale, one drilling rig in the Woodford Shale and one drilling rig in the Piceance Basin. The Company plans to add an additional drilling rig in the Marcellus Shale in late summer 2011. The capital budget is expected to be funded internally from operating cash flow, through the use of the undrawn capacity under Antero’s bank credit facility and through noncore asset sales.

Antero has closed on approximately $15 million in non-core upstream and midstream asset divestitures in the second quarter of 2011. At March 31, 2011 pro forma for the bank commitment increase previously disclosed, Antero had $561 million of available borrowing capacity under its bank credit facility.

*Antero Resources Press Release (May 31, 2011) – Antero Resources Revises 2011 Capital Budget and Outlook (PDF)