Gulfport Energy Corp., one of the major drillers in Ohio’s Utica Shale, is voluntarily cutting back on production.
The company intends to scale back production in eastern Ohio by 100 million cubic feet per day or about 15 percent.
The changes began Sunday and will likely continue into early 2016, company officials announced Thursday.
The cutback was triggered by continuing low commodity prices and the company’s recent drilling success, CEO Michael C. Moore said in an earnings call with analysts and the media.
He said the decision was the best way to proceed and said he hoped that drillers would do the same thing.
The move was made with the hope that natural gas prices will rise and the company will save $500,000 per well by not fracking wells this winter, officials said.
The Oklahoma-based company reiterated its 2015 production guidance of 517 million to 541 million cubic feet of natural gas per day.
The firm is dropping plans to add a fifth drilling rig in early 2016 in the Utica Shale. Instead, it will continue to operate with four rigs.
It is also idling a fracking crew.
For the third quarter of 2015, Gulfport reported a net loss of $388.2 million or $3.59 per share on oil and natural gas revenues of $230.4 million.
Its daily production in the third quarter averaged 647.1 million cubic feet of natural gas per day. Gulfport’s mix was 81 percent natural gas, 12 percent natural gas liquids and 7 percent oil.
October production was estimated at 706.3 million cubic feet per day.
The company drilled 10 extra wells last summer at a cost of about $60 million, officials said.
In the third quarter, Gulfport drilled 15 Utica wells and began production on 16 additional Utica wells.
Well-drilling costs have dropped 5 to 8 percent, Gulfport said.
The company had drilled 209 wells in Ohio, No. 2 in the Utica Shale behind Chesapeake Energy Corp.
This article was written by BOB DOWNING from The Akron Beacon Journal and was legally licensed through the NewsCred publisher network.