Welcome to the Business Journal Archives
Search for articles below, or continue to the all new BusinessJournalDaily.com now.
Search
Range Resources Reports $41.8M Loss in Q1
FORT WORTH – Range Resources Corp. reported a net loss of $41.8 million, or 26 cents a share, during the quarter ending March 31, dragged down by rock-bottom natural gas prices and increasing costs, according to a filing with the Securities and Exchange Commission Wednesday.
The loss compares to a net loss of $25 million, or 16 cents a share, during the same period in 2011, the records show.
Depressed prices of natural gas, along with an abundance of inventory because of a mild winter, has caused natural gas companies to pull back from dry gas exploration and has also affected the bottom line among these energy giants.
Range is most active in the Marcellus Shale in Pennsylvania, and is especially concentrating its efforts in the "wet" gas areas of the southwestern portion of the state such as Washington County.
Range said that it plans to ramp up wet gas exploration this year. Liquids gas such as ethane, butane and propane are commanding much higher prices compared to lower-priced dry gas such as methane.
"The operational results from the first quarter 2012 demonstrate the progress that Range is making in expanding our liquid-rich development areas," said CEO Jeff Ventura in a statement. "We are on track to significantly drive up our liquids production in 2012 while hitting our overall 30% to 35% production growth target."
Analysts were expecting a better showing from Range, which earlier this month reported that production during the first quarter increased 20%.
Range shares rose 2.8% Wednesday to $60.16. The company released its financials after the close of the market, but shares were still slightly up in after-hours trading.
Total revenue during the quarter rose 16%, the company reported, while Range posted $246.9 million in sales of natural gas, natural gas liquids and oil. Sales of these products were up 26% compared to a year earlier.
However, the costs for transportation, gathering and compression services soared 63% for the quarter, while the average gas prices fell 14% during the quarter.
Range said it also took some heavy write-downs, such as a one-time $53 million non-cash charge against the value of its hedges against future oil and gas production.
Range sold its position in Texas' Barnett Shale last year, and today is the largest leaseholder in the Marcellus play with more than one million acres. The Marcellus shale accounts for about 70% of the company's gas production.
About 80% of current production from the Marcellus is coming from the liquids-rich play of southwestern Pennsylvania, the company reported. Range said that it is in the process of constructing another 50 miles of pipeline that will interconnect with processing centers in the region.
Published by The Business Journal, Youngstown, Ohio.