Sanchez Energy is making plans for 2018 that include redicing drilling activity and cutting spending by $75 million to $100 million.
Sanchez Gains Eagle Ford Assets for $2.1 Billion
Sanchez reported its second quarter results last week that included increased revenues and a net income of $46.3 million, up from $9.7 million during the first quarter of 2017.
The Company achieved record production from its Comanche area in Dimmit, LaSalle and Webb Counties. The acquisition of the Comanche assets in March was instrumental in these record production levels.
“In July 2017 we announced our intention to reduce our 2018 capital spending by approximately $75 million to $100 million, compared to our original $500 million guidance. This reduction in capital spending, together with our strong liquidity position and bank of 30 wells against our 2017-18 Catarina drilling commitment, provides us with a considerable amount of financial and operating flexibility as we look to execute our plans over the next 12 to 18 months, and drive shareholder value.”
Q2 Highlights
Sanchez is currently running seven gross rigs in the Eagle Ford; five in Comanche and two in Catarina. Other second quarter highligts include:
- Company revenues jumped 58% over last year at this time to approximately $175.7 million
- Production totaled approximately 73,341 barrels of oil equivalent per day ("Boe/d"), an increase of approximately 43% over first quarter 2017 production
- Company spud 48 gross wells and completed and turned on-line 63 gross wells
- $3.9 million per well
- Catarina experienced a reduction of approximately 4000 barrels of oil equivalent per day in 2017. Earlier this year, we made the move to shift Catarina completions to our Gen 3 design, using approximately 3000 pounds per foot of profit. The 25 wells have positive early indications with respect to pressures in rates, but saw a higher water production and the subsequent decline was dramatically steeper than anything we've seen previously.