Southwestern to reduce rig count in Appalachian Basin
Friday, August 9, 2019
Southwestern Energy Co. recently announced it plans to reduce its rig count from six to two in coming weeks as part of a larger initiative to reduce spending and better control costs, according to Natural Gas Intelligence.
The company also trimmed its full-year capital budget, saying spending would not eclipse $1.15 billion in 2019 — reduced from $1.18 billion. The decision announcement comes at a time when other operators in the Appalachian Basin are cutting spending and activity on low natural gas prices.
Southwestern Energy’s full-year guidance of 750-785 Bcfe remains the same and implies an annual growth rate of 9%, which isn’t likely to change much next year, according to CEO Bill Way.
Learn more: Natural Gas Intelligence > Southwestern Dropping Four Rigs in Appalachia
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Shale FAQ
What is fracking?
Fracking is a slang term for hydraulic fracturing. Fracturing is a process by which highly pressurized fluid is pumped thousands of feet into the ground to fracture rock formations. The goal is to release the natural gas that’s locked inside the rock.
Is it safe?
What most concerns people about fracturing is ground water contamination. The worry is that fractures underground, caused by the process, will extending upwards and into aquifers, releasing gas and chemicals into the ground water supply. There’s been no confirmed reports of such a thing happening. Though surface spills and drill site blowouts can lead to localized environmental concerns.
Will my water catch on fire?
Flammable water is caused by the release of methane gas into a drinking water supply. Methane gas occurs naturally and can be released by any kind of drilling, including water wells. In Pennsylvania officials fined Chesapeake Energy $1 million for contaminating ground water with methane. It was determined that the company had not properly cemented it’s boreholes and gas migrated up the well, between rock and into aquifers.