Drilling & Completions | Forecast - Production | Drilling Activity | Drilling Program-Rig Count

Montage Cuts Rigs 50% for 2H19; Increases Guidance for Q2 as Wells TIL

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Montage Resources Corp. has announced a reduction in its planned activity level for the second half of 2019 as well as an ops update.

Cutting 50% of Rigs for 2H19

Given increased operational efficiencies as well as the currently anticipated lower commodity price environment for the second half of 2019, the Company is reducing activity to one gross operated rig from the two gross operated rigs it is currently running. The Company plans to continue to run one gross operated rig through the remainder of 2019 and will evaluate 2020 activity in order to deliver continued disciplined growth while maintaining an attractive balance sheet.

The reduction in planned activity for the second half of 2019 leads to an approximately $30 million reduction in 2019 capital spending compared to the initial 2019 capital plan of between $375 to $400 million, while targeting significantly more liquids production for the remainder of 2019.

The Company is pleased to announce that despite the reduction in planned activity and capital expenditures, it is reaffirming the previously announced full year 2019 production guidance of 520 to 540 MMcfe per day.

Q2 Guidance to Exceed Expectations - Credits Ops Efficiencies

During the second quarter of 2019, Montage Resources continued to deliver strong performance on its previously announced plan. The Company currently expects its second quarter 2019 production to be above the high end of its previously announced guidance and to exceed current consensus expectations.

As a result of the Company's strategy shift designed to dramatically reduce cycle times by more than 30% over the prior year, the Company has been able to realize a number of operational efficiencies that have accelerated the timing and number of wells turned in line during the quarter.

These accelerated turn-in-lines, when coupled with exceptional individual well performance, allowed the Company to achieve higher production levels while spending less on a per well basis. The Company continues to realize service cost reductions in the Appalachian basin, further enhancing its peer leading cost structure to below the $870 per foot level presented with the 2019 plan. Substantial declines in completed well costs and operating expenses continue to enhance cash operating margins and support robust well economics in the current commodity price environment.