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Updated Antero Resources results reveal 12% rise in estimated proved resources

Published by , Assistant Editor
Global Mining Review,

Antero Resources (Antero) has shared estimated reserves as of 31 December 2017.  Antero's estimated proved reserves at 31 December 2017 were 17.3 trillion ft3, a 12% increase compared to estimated proved reserves at 31 December 2016.  Proved, probable and possible (3P) reserves at year-end 2017 totalled 54.6 trillion ft3, which represents an 18% increase compared to the previous year. 

Estimated Proved Reserves

As of 31 December 2017, the company's 17.3 trillion ft3 of estimated proved reserves were comprised of 64% natural gas, 35% NGLs and 1% oil.  The Marcellus Shale accounted for 90% of estimated proved reserves and the Ohio Utica Shale accounted for 10%.  For 2017, Antero added 1.7 trillion ft3 of estimated proved reserves organically, excluding acquisitions. This reflects the continued productivity gains from the use of advanced completion techniques and longer laterals. 

All 381 proved undeveloped locations in the Marcellus at year-end 2017 were booked at an approximate 2 billion ft3/1000' type curve.  This compares to year-end 2016 at which time 81 proved undeveloped locations, or 21% of the total proved undeveloped locations in the Marcellus, were booked at the approximate 2 billion ft3 1000' type curve.  The primary driver behind the increase in the number of proved undeveloped locations booked at the higher approximate 2 billion ft3/1000' type curve type curve is the increased production history observed from the implementation of advanced completions techniques.  

Estimated proved developed reserves increased by 23% from year-end 2016 to 8.5 trillion ft3 at 31 December 2017. The percentage of estimated proved reserves classified as proved developed increased to 49% at 31 December 2017 from 45% at year-end 2016.  The average heating content of Antero's proved undeveloped locations is 1237 BTU, and the average lateral length is approximately 10 500 ft.  

Under the Securities and Exchange Commission (SEC) reporting rules, proved undeveloped reserves are limited to reserves that are planned to be developed within five years of initial booking. The company reclassified 2778 billion ft3 of formerly non-proved reserves to proved undeveloped due to their addition to Antero's five-year development plan.  Included in this reclassification was the revision of 286 Bcfe related to an improvement in performance from advanced completions and a 291 billion ft3 revision related to a lateral extension of previously booked locations. Additionally, the company reclassified 2280 billion ft3 of generally lower BTU proved undeveloped reserves to the probable category in 2017 to comply with the SEC five-year development rule.  Antero's 8.8 trillion ft3 of estimated proved undeveloped reserves will require an estimated US$3.3 billion of future development capital over the next five years, resulting in an estimated average future development cost for proved undeveloped reserves of US$0.37/ million ft3

Antero incurred estimated capital costs of approximately US$1.7 billion during 2017, including drilling and completion costs of US$1.282 billion, proved property acquisitions of US$176 million and leasehold additions of US$204 million. Based on the US$1.7 billion of capital costs, 2017 all-in F&D cost for proved reserve additions from all sources, including acquisitions and revisions, was US$0.59/ million ft3.

Antero estimates that it had year-end 2017 3P reserves of 54.6 trillion ft3, an 18% increase from year-end 2016.  The 18% increase in 3P reserves was driven by a combination of increased type curves in certain areas driven by continued productivity gains from advanced completions, as well as 2017 leasehold acquisitions. As of 31 December 2017, the company's 54.6 trillion ft3 of 3P reserves were comprised of 75% natural gas, 23% NGLs and 2% oil. The Marcellus and Ohio Utica Shale comprised 48.3 trillion ft3 and 6.4 trillion ft3 of the 3P reserves, respectively. Virtually no Upper Devonian or West Virginia Utica reserves were included in 3P reserves.    


Significantly, 46.2 trillion ft3 of Antero's 48.3 trillion ft3, or 96% of estimated Marcellus 3P reserves were classified as proved and probable reserves (2P), reflecting the low risk and statistically repeatable nature of Antero's resource base. The 46.2 trillion ft3 of Marcellus 2P reserves includes 381 proved undeveloped and 460 probable locations, or 26% of the total undeveloped 2P reserve locations in the Marcellus that were booked at the approximate 2 billion ft3/1000' type curve.  This compares to year-end 2016 where 81 proved undeveloped and 7 probable locations, or just 3% of the total undeveloped 2P reserve locations in the Marcellus were booked at the approximate 2 billion ft3/1000' type curve.  The increase in upgraded 2P locations is primarily driven by continued productivity gains from implementing advanced completions techniques across a larger subset of Antero's acreage position. Further, 6.2 trillion ft3 of Antero's 6.4 trillion ft3, or 97% of estimated 3P reserves in the Ohio Utica were classified as 2P.  

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