American Oil and Gas Reporter - May 2017 - 73

SpecialReport: Gas Compression Technology

Editor's Note: The opinions and conclusions expressed in this article do not
necessarily represent the views of CONSOL Energy Inc. and its affiliates.

Rex Energy Corp. Selling
Ohio Utica Shale Assets
STATE COLLEGE, PA.-Rex Energy
Corp. says it is selling its Ohio Utica
Shale assets in the Warrior South area to
Antero Resources Corp. for $30 million.
The transaction consists of 14 gross wells
producing 9.0 million cubic feet of gas
equivalent a day and 4,100 net acres in
Guernsey, Noble and Belmont counties.
"Rex Energy routinely evaluates its
asset portfolio to align our development
plans with the strategic deployment of
capital," comments President and Chief
Executive Officer Tom Stabley. "With
limited opportunity to expand our development in Warrior South, and high quality
assets located in near proximity to Antero's
operations, we view this transaction as a
win for both parties."
❒

FIGURE 3A
Production Curves to Yield Same IRR (36 Percent)
30MM

1,000,000

25.710MM

20MM

15MM

900,000

Gas Rate (MMcf/m)

800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
0

0

10

20

30
40
Time (months)

50

60

70

FIGURE 3B
Production Curves to Yield Same NPV ($3.529 Million)
30MM

1,000,000

25.710MM

20MM

15MM

900,000
800,000

Gas Rate (MMcf/m)

needed to justify producing the wells at
lower rates by obtaining the same aftertax IRR (36 percent) achieved at 30
MMcf/d for six months.
As shown in Figures 3A and 3B, to
justify producing at 25 MMcf/d, a 6 percent EUR increase (2.97 Bcf/1,000 feet
as opposed to the original 2.8 Bcf/1,000
feet) would be needed to obtain the same
36 percent IRR. Producing the well at 20
MMcf/d would require a 20 percent increase in EUR (3.36 Bcf/1,000 feet) to
obtain the same IRR. Producing at 15
MMcf/d would require an almost 50 percent EUR increase to get the same IRR.
If NPV is used instead of IRR, 1.51, 4.72
and 9.56 percent NPV increases are required for the respective lower production
cases to get the same $3.529 million
NPV as the 30 MMcf/d base case.
The production data show up to 30
percent improvement in EUR using managed pressure drawdown of 15-20 psi/d
casing or tubing pressure drop. While
the economic sensitivity findings generally
favor producing at higher flat rates, the
risk of damaging the formation or completion increases proportionally as flow
rate increases. This illustrates the importance of determining the maximum rate
at which no productivity damage will be
caused to the well to avoid impairing
well performance and recovery over time.
❒

700,000
600,000
500,000
400,000
300,000
200,000
100,000
0

0

10

20

HOSS BELYADI is a reservoir engineer IV with EQT Corp. Previously, he
was a senior reservoir engineer at CONSOL Energy specializing in production
and completions optimization, completions
and reservoir modeling, and project evaluation. Belyadi is the primary author of
"Hydraulic Fracturing in Unconventional
Reservoirs (Theories, Operations and
Economic Analysis)," peer reviewed and
published by Gulf Professional Publishing
(Elsevier). He holds a B.S. and an M.S.
in petroleum and natural gas engineering
from West Virginia University.
EBRAHIM FATHI is an assistant professor of petroleum and natural gas engineering at West Virginia University.
His research interests include multistage

30
40
Time (months)

50

60

70

hydraulic fracturing of horizontal wells,
shale reservoir characterization, and
carbon dioxide enhanced shale oil and
gas recovery. Fathi holds a B.S. in mining
engineering and an M.S. in petroleum
engineering from Tehran University, and
a Ph.D. in petroleum engineering from
the University of Oklahoma.
FATEMEH BELYADI is an assistant
professor in the petroleum and natural
gas engineering department at West Virginia University. She formerly served as
an application engineer at Exterran Energy Solution Company and KOGC.
Belyadi holds a B.S., an M.S. and a
Ph.D. in petroleum and natural gas engineering from West Virginia University.
MAY 2017 73



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