QEP RESOURCES REPORTS SECOND QUARTER 2018 FINANCIAL AND OPERATING RESULTS
AND PROVIDES UPDATE ON ITS STRATEGIC AND FINANCIAL INTIATIVES
DENVER — July 25, 2018 — QEP Resources, Inc. (NYSE:QEP) (QEP or the Company) today reported second quarter 2018 financial and operating results and provided an update on its strategic and financial initiatives (Strategic Initiatives) announced in February.
Delivered record quarterly oil and condensate production of 6.6 MMbbls, including a record 3.2 MMbbls in the Permian Basin, a 32% and 49% quarter-over-quarter increase, respectively
Delivered 20% quarter-over-quarter increase in Williston Basin production driven by strong results from our drilling and refrac programs on South Antelope
Increased quarterly production in Haynesville/Cotton Valley to 314 MMcfed, a 71% year-over-year increase, driven by strong results from our drilling and refrac programs
Decreased Permian Basin lease operating expense (LOE) to $5.10 per Boe, a 24% year-over-year decrease
Increased 2018 oil and condensate production guidance to reflect improved efficiencies in the Permian Basin and better than forecasted results in
the Williston Basin
"Our record Permian Basin oil production performance in the second quarter demonstrates the quality of our assets and underscores the continued success of our 'tank-style' completions," commented Chuck Stanley, Chairman, President and CEO of QEP. "We continue to put more wells on production than originally forecast in the Permian Basin due to operational efficiencies, such as faster drill times and a 33% quarter-over-quarter increase in the number of frac stages completed per crew per month. These efficiency gains have enabled us to drive down gross completed well costs by over five percent since the fourth quarter 2017, while bringing a similar number of wells in the basin onto production, operating fewer drilling rigs and utilizing fewer frac crews than originally planned for the year."
"For the remainder of 2018 we will continue to focus on balancing capital investments with cash flow and will be allocating the vast majority of capital to the Permian Basin. We expect to put approximately 31 wells on production in the Permian Basin in the second half of 2018, with more than 50% of these wells having lateral lengths of 9,000 feet or greater. We expect the addition of these long laterals, along with our current drilling rig and frac crew level, to support our production profile in 2018 and lay the foundation for oil production growth in the Permian Basin in 2019."
"We continue to make progress on our Strategic Initiatives. In early July, we announced the execution of a definitive agreement to sell our Uinta Basin assets for a purchase price of $155 million (Uinta Basin Divestiture), with an anticipated closing in September. During the second quarter, we received bids for our Williston Basin assets, which we believe did not reflect the value of the underlying quality and economics of the assets. Our decision not to accept the current bids for our Williston Basin assets is reflective of our duty to maximize the value of our company and its assets for all of our shareholders. We continue to engage in discussions with several potential buyers regarding the sale of all, or a portion of, our Williston Basin assets."
"While our transition to a pure play Permian Basin company may take longer than we originally anticipated, QEP’s Board and management remain committed to the Strategic Initiatives," concluded Stanley.
The Company has posted to its website www.qepres.com a presentation that supplements the information provided in this release.