Cabot Oil & Gas reported initial results from its two well 400' (55-acres) spacing test and plans to drill additional wells. The best of the two wells provided the highest initial IP rate of any of the company's 33 wells to date. The second well is trending higher than the average of the company's program to date.

Downspacing across the play is looking more and more viable in the volatile oil and the condensate trends of the play.

Cabot now plans to drill a second set wells utilizing 400 ft spacing to continue its evaluation. I suspect we'll know more by the end of the third quarter and we'll know if the company will shift its development program by early 2013.

Read the full quarterly press release at cabotog.com.