Range Resources

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Drilling rig in rural Washington Co., PA
Photo credit - donnan.com

Range Resources (NYSE: RRC) of Fr. Worth, TX is the biggest gas producer in Pennsylvania and is one of the largest drillers in the U.S. Reportedly, it invested $500 million alone in its Marcellus shale leasehold. Between 2005 and 2008, counting all drilling and infrastructure costs, its total investment in the play was closer to $700 million. It has the distinction of having started the Marcellus shale play when it drilled its first Marcellus well in southwest Pennsylvania's Washington County. This well began Marcellus gas production in 2005.

As the granddaddy of Marcellus shale drilling, Range invested $426 million in Appalachia during 2008. By April, 2008, it had 12 horizontal wells. The most recent six drilled produced an average of 5 MMcf/day. All used horizontal drilling techniques. That compares very favorably with the drilling results from the Barnett shale play in North Texas.

In April, 2008 it was reported that Range had drilled three wells in Lycoming County, Pennsylvania and was planning a forth well there.

By October the company was reporting that it had drilled one hundred-thirty wells in the Appalachian Basin. One hundred were vertical ones and thirty horizontal. The same report indicated Range had leased drilling rights on 900,000 acres of land in Pennsylvania.

Its total Appalachian Basin leasehold is 2.3 million net acres with 1.4 million of it prospective for Marcellus shale drilling. Its acreage is located in southwest Pennsylvania, northwest Pennsylvania and southern New York State.

In September, 2008, the Range was reported to be actively drilling in the Susquehanna Basin of Pennsylvania. It paid a fine to the Susquehanna River Basin Commission of $475,000 for not complying with limits on water withdrawal for wells in the Basin.

Range was reported in September, 2008 to be actively leasing drilling rights in Greene County in the southwest corner of Pennsylvania.

According to an October, 2008 report the company had recorded 172 leases during 2008 with the Bradford County Registrar of Deeds. Bradford County is located in northeastern Pennsylvania. An April, 2009 update from the company indicated that it had 40,000 acres under lease in Bradford County, but had not yet started drilling there. Instead, Range is focusing on developing its leases in southwestern Pennsylvania where it has better pipeline infrastructure. A company rep expressed doubt that drilling will begin in Bradford during 2009, but said it eventually would once the company has built up its pipeline infrastructure in the area.

Another October, 2008 report indicated that Range is heavily involved in Washington County in southwestern Pennsylvania. In 2003, it had drilled a test well in the County's 2,700-acre Cross Creek Park that was successful. By 2008 three gas wells in the park were producing 30 Mmcf/d. Cross Creek Park was again in the news in June, 2009 when the Pennsylvania Department of Environmental Protection (DEP) was considering a possible enforcement action against Range over apparent toxic drainage from a leaky coupling on a six inch waste water pipe running from a recently drilled well to an impoundment area. Reportedly, there had been a fish, salamander, crayfish and aquatic insect kill in about three-quarters of a mile of a stream leading into Cross Creek Lake. DEP was taking water samples both above and below where drainage from the leaky coupling entered the stream in order to be analyzed as one aspect to their investigation. A company spokesperson indicated a vandal may be to blame for the problem.

Mark West Energy has built and maintains a gas gathering system and compression facilities for Range's Marcellus production. Part of the infrastructure are refrigeration and cryogenic processing plants. One plant is located in Chartiers Township in Washington County. On the outskirts of Hickory, located about 15 miles north of Chartiers, is a three-acre reservoir for drilling water, a gas compressor station, and a liquid extraction plant. As of April, 2009 Range's Washington County wells were starting to come on stream with these plants which have the capacity to process 60 Mmcf/d. The company continues to expand its processing capability in Washington County and expects to have the capacity to produce 200 Mmcf/d by year-end 2009 or early 2010.

In November, 2008, Range was reported drilling on the John Dunn farm near Houston, Pennsylvania in Washington County. Two gas processing plants are under construction on State Route 519, three miles north of Houston. These are probably the same ones referred to in the above paragraph.

A few miles away to the northwest of Houston in rural Mt. Pleasant Township, it was reported in March, 2009 that Range had drilled 68 wells there. For example, Range drilled on the 133 acre Joyce Mitchell farm in nearby Hickory, PA.

Range is evaluating a test well in Jefferson County, Ohio which is roughly forty miles west of Pittsburgh, PA.

In March, 2009 Range was conducting seismic testing in collaboration with Conquest Seismic Services to the north of Pittsburgh in Beaver County, Pennsylvania. According to the report, Conquest had wired 13 miles of state road west of the Beaver Valley Expressway with acoustic sensors.

Also in March, 2009 Range reported several Marcellus shale operating highlights which included:

  • One well with a flow rate to sales of 10.3 Mmcfe/d.
  • Four out of the last eleven wells drilled had initial flow rates in excess of 9.9 Mmcfe/d.
  • The best well had an initial rate of 24.5 Mmcfe/d.
  • Two vertical wells in the northeastern section of the Marcellus play with initial flow rates of 2.3 Mmcfe/d and 6.3 Mmcfe/d. The latter is the highest initial rate ever recorded for a vertical Marcellus well.
  • Since October, 2008 13 new wells have been brought online to the gas processing facility. These wells have averaged 6.9 Mmcfe/d.
  • 14 wells have been completed--seven are horizontal and already fraced--that are awaiting hook-up to the gas processing facility.
  • Range is planning to drill 60 new Marellus wells during 2009.

In an operational update provided in April, 2009 the company mentioned that it was in the process of acquiring six new custom-designed Marcellus shale drilling rigs. Two had already been delivered and were in use. These rigs have crawlers that traverse a drilling pad in a few hours compared to several days for older rigs. Range typically drills several laterals on a single pad, so these new rigs are much for efficient for doing so. Range's goal is to drill at least 60 horizontal Marcellus wells in 2009.

In a separate April, 2009 report it was mentioned that Range will be introducing the so-called Drake Rig built by National Oilwell Varco for Marcellus shale drilling in Pennsylvania. It was not clear from the report whether these are the same new rigs referred to in the above paragraph.

It was mentioned in a separate April update that Range had two new horizontal Marcellus wells. The first had an initial flow rate of 7.9 Mmcfe/d and the second had 10.7 Mmcfe/d.

Range has also been actively drilling in the Huron shale formation in Virginia. It has recently drilled four horizontal wells in Virginia's Nora Field. As of April, 2009, It has a total of eight producing horizontal wells in the play with average production of 1.1 Mmcf/d. It is planning to drill 20 horizontal Huron shale wells in the Nora field. Range owns a 50% working interest in Nora.

In April, 2009 Range announced its best Huron well ever which had averaged 3.0 MMCf/d for the past 30 days.

  • John H. Pinkerton is Chairman and CEO of Range Resources.
  • Jeffrey L. Ventura is President and COO.
  • Rodney Waller is Senior Vice President of Appalachia Shale.
  • Bill Zagorski is Vice President of Geology
  • Ray Walker is Vice President of Appalachia Shale.
  • Carl J. Carlson is Director of Government Affairs.
  • Matt Pitzarella is Director of Public Affairs.
  • Dave Schieck is a geophysicist with the company.
  • Mike Forgione is Senior Engineer, Appalachian Basin Office.

Range's Appalachian Division Headquarters is located in Southpointe Office Park in Cecil, Washington County, Pennsylvania.

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