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CNX's Utica Output Drops -21% from 2Q18; Touts Drill / Frac Time Record in the Marcellus

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CNX Resources reported its Q3 2018 results.

Production: Utica Sees Drop from Prior Quarter; Still Up YOY

- Q3 production of 119 Bcfe (up +18% YOY and down -3.6% from 2Q18)

• Utica production down -21% from 2Q18 at 33.6 Bcfe. Despite this quarterly decline, Utica production is still up for CNX +67% YOY.

• Marcellus production saw an increase of +9% from 2Q18 to 70.6 Bcfe.  It is up +17% YOY.

- In Q3, CNX operated four horizontal rigs

- CNX drilled 23 wells in Q3, which included 15 Marcellus Shale wells in Greene County, Pennsylvania; three dry Utica Shale wells in Westmoreland County, Pennsylvania; three dry Utica Shale wells in Monroe County, Ohio; and two Marcellus Shale wells in Tyler County, West Virginia.

Marcellus - Drill / Frac Time Record

During the quarter, in the Shirley-Pennsboro area, CNX set a new company record by completing 2,600 feet per day, as well as completed a record 13 stages in a 24-hour period.

The company has also edited its completion design, increased its lateral length and proppant loading while tightening spacing.

Focus on Utica Efficiencies with Upgraded Rig

In Pennsylvania, CNX continues to gain drilling efficiencies in the dry Utica Shale due in part to a specially outfitted rig on the Shaw pad in Westmoreland County, Pennsylvania, and CNX will benefit from a similarly upgraded rig that the company expects in Greene County, Pennsylvania.

Production Guidance Narrowed

The midpoint of the 2018 production guidance remains unchanged, but the company narrows the range to 497.5-507.5 Bcfe, compared to the previous guidance of 490-515 Bcfe. CNX reaffirms net capital expenditure guidance of $900-$950 million.