Rex Energy Corp. Q3 2009 Earnings Call Transcript

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2009-11-06 12:49:08.0

Tags: Well, Call Transcript, Compression, Earnings, Productivity, Sales Force Management, Sales, Seeking Alpha

Question-and-Answer Session

Operator

(Operator Instructions)

And we'll take our first question from Leo Mariani with RBC Investments.

Leo Mariani - RBC Investments

Looking for a little bit more color on your first two well results in Westmoreland, are those wells starting the production, are you getting some at least reasonable production. Clearly, it sounds like they want us to go to the third when you change technique, can you give me any more color on that?

Benjamin Hulburt

Sure. All three wells are currently tied into production, but we did require a bit more compression for all three to be on the floor, at the full amount. So all three are currently curtailed, that additional compression should be completed today so that all three will be on the on the flow at their current amount. So, right now, they are all curtailed by probably about half, but by the end of the day that should change.

Leo Mariani - RBC Investments

Okay. And can you remind us what your current take away capacity is right now prior to getting that compression online in Westmoreland?

Benjamin Hulburt

Before the compression was online, we were probably tapped out at about three million a day or so. Now, by adding this additional compression, we should be able to put about 15 to 18 million a day into that tap site. So the remainder of the wells that we'll drill in that County this year will all be able to go unrestricted into that tap.

Leo Mariani - RBC Investments

Looking into fourth quarter here, can you guys give an estimated of CapEx?

Benjamin Hulburt

Yes. Tom, can you handle that?

Tom Stabley

Yes. The estimate number would be about 12.8 million, Leo.

Leo Mariani - RBC Investments

What are those wells in Illinois basin costing you guys?

Tom Stabley

They average about 250,000 a piece.

Benjamin Hulburt

In Butler County, sounds like you are getting ready to move a rig out there, pretty early in 2010. What do you guys think those well costs would be?

Benjamin Hulburt

Our next round of wells, we're forecasting to be about 3.9 million. It's our hope that Butler County will ultimately be the cheapest area, both in our terms of our drilling. So the next round, we forecasted about 3.9 and we think we'll continue to make progress from there.

Operator

And we will take our next question from Jeff Hayden with Rodman & Renshaw.

 

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