EQT Changes Course, Slowing Utica, Ramping Up Marcellus/UD

EQT logoEQT, one of the big Marcellus/Utica drillers, with its headquarters in Pittsburgh, released an interesting second quarter 2016 update yesterday. Along with the update came a quarterly conference call with analysts. You may recall that the Utica Shale play previously turned the head of EQT (see EQT Dumps Marcellus Drilling, Concentrates on the Utica in 2016 and EQT is in Love with the Utica – Comments from Analyst Call). EQT has done a 180 degree about face. On the call and in the update from yesterday, the company said they are slowing their Utica program and instead ramping up their Marcellus and currently dormant Upper Devonian (UD) drilling program again. Why the change of heart? It’s a whole lot cheaper to drill a Marcellus or UD well than it is a Utica well. Plus, you have to drill UD wells at the same time you drill the deeper Marcellus, otherwise you’ll lose the UD layer. You can’t go back and drill/frack the shallower UD layer after you’ve already drilled the Marcellus layer. We also learn from yesterday’s update that after making $5.5 million in profit in 2Q15, EQT lost $259 million in 2Q16. However, the stock market was unfazed and EQT’s stock price actually closed up yesterday…

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