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$QEP 1Q15 10-Q: At March 31, 2015 (vs. at Dec. 31, 2014): Total assets were $8,524.4MM vs. $9,286.8MM. Total liabilities were $4,504.5MM vs. $5,211.5MM. QEP had $2,221.8MM principal amount of senior notes outstanding with maturities ranging from Sept. 2016 to May 2023 and coupons ranging from 5.25% to 6.875%.
$QEP announced the expiration of the offers to purchase for cash up to $361MM aggregate principal amount of its outstanding 6.80% senior notes due 2020 and 6.875% senior notes due 2021. The company also announced the completion of the previously announced redemption of all of its outstanding 6.80% senior notes due 2018.
$QEP's subsidiary, QEP Energy Company, entered into 2 definitive agreements to sell natural gas (NG) assets in southwest Wyoming for combined proceeds of $777.5MM. The transaction is expected to close by Sept. 30, 2017. $QEP also closed the sale of some non-core NG assets in southern Wyoming to an undisclosed buyer. The purchase price was $37.5MM.
$QEP 2Q15 Q&A: Brian from Scotia Howard asked to comment on the seventh well? Charles said, the seventh well, we just turned around and started flowing back. So, it's too early. It has just barely started to make gas. Comment may be I misstated, we’ve completed part of vertical Pinedale style wells that we’re flowing back right at end of quarter.
$QEP 2Q15 Q&A: Brian from Scotia Howard asked about level of capital spends for 2015? Charles said, we will allocate capital around gas & oil depending on pricing & returns. So at the level of granularity that you're asking, I think it’s little premature. I think at this juncture flattish overall & I would say flattish for gas and oil volumes.
$QEP 2Q15 Q&A: Timothy from Sterne Agee asked on how much running room left in Pinedale? Charles said probably we’ve got four to five years of developmental opportunity left, & part of that depends on how many wells which we use to drill & complete over next time frame. We may make capital allocation decisions to push more dollars towards winter.
$QEP 2Q15 Q&A: Timothy from Sterne Agee asked about activity levels for 2016 in Canada? Charles said, for Canada, I would think about number of wells drilled and getting more production. So it's just too early to give you a hard number. Production response is flattish-to-slight growth, if we were to take that 2H run rate & push it into 2016
$QEP 2Q15 Call: Timothy from Sterne Agee asked on how much running room left in Pinedale? Charles said probably we’ve got four to five years of developmental opportunity left, & part of that depends on how many wells which we use to drill & complete over next time frame. We may make capital allocation decisions to push more dollars towards winter.
$QEP 2Q15 Call: Timothy from Sterne Agee asked about activity levels for 2016 in Canada? Charles said, for Canada, I would think about number of wells drilled and getting more production. So it's just too early to give you a hard number. Production response is flattish-to-slight growth, if we were to take that 2H run rate & push it into 2016
$QEP 2Q15 Call: We’ve two operative horizontal rigs active in Permian. We plan to invest about 25% of our total capital budget in Permian Basin in 2015. At Pinedale at end of 2Q15, we had three rigs operating on our acreage. During 2Q15, Pinedale net production average to 274MM cubic feet of gas equivalent/day, that's comprised of about 14% liquids
$QEP 2Q15 Call: Total gas equivalent production declined 4% from 2Q14, crude oil production was up 22% from 2Q14 last year and up 9% sequentially from the 1Q15. If we exclude the production from our Mid-Continent asset, our total gas equivalent production was actually up 10% from the second quarter of 2014 on a continuing basis.
$QEP 2Q15 Call: We generated net loss of $76MM in 2Q15. There were several noncash items that negatively impacted net income. We also recorded gain on asset sales of $24.5MM. CapEx for E&P activities on an accrual basis were $275MM, which was slightly less than 2Q15 adjusted EBITDA. We are not changing guidance range for 2015 capital spending.
$QEP 2Q15 Call: Excluding $11.2MM non-cash charge in 2Q15 related benefit pension plan, G&A expenses were $40MM, which was down about $7MM from 1Q15, primarily as a result of lower labor cost & lower stock compensation expense. Our guidance range for G&A expenses for FY15 is unchanged to $170-185MM, excluding $11MM charge for pension curtailment.
$QEP 2Q15 Call: On a per unit basis, LOE were $0.71 per Mcfe, which was down $0.11 per Mcfe from 1Q15; & transportation expense was $0.93 per Mcfe, which was up $0.03 from 1Q15. Reflective of improved operating results, we’ve revised our guidance for lease operating and transportation expenses downward to be in range of $1.65-1.80 per Mcfe for FY15
$QEP 2Q15 Call: Fuel level crude oil revenues account for 64% of total fuel level revenues, which was about 8% higher than in 1Q15. Derivative settlements added $92.3MM or $1.14 per Mcfe to QEP Energy's net price realizations compared to $1.36 per Mcfe in 1Q15. QEP Energy's combined lease operating & transportation expenses were $133MM from quarter
$QEP 2Q15 Call: QEP Energy's net realized equivalent price, which include the settlement of our commodity derivatives, averaged $5.94 per Mcfe, which was $0.33 per Mcfe higher than we realized in the first quarter of the year. The weighted average fuel equivalent price in the quarter was $4.80 per Mcfe, which was 13% higher than in first quarter.
$QEP 2Q15 Call: Our updated guidance for 2015 oil production is in range of 18-19MM barrels, mid-point of which is up 0.75MM barrels from previous guidance, & reflects to continue to improvement in both Willston & Permian basins. Our updated guidance for NGL volumes is unchanged to4-4.3MM also for Natural Gas production is unchanged at 165-175 Bcf.
$QEP 2Q15 Call: Crude oil comprised 36% of our total production in second quarter, which is about same level as in first quarter of the year. Oil production is up 338,000 barrels in Williston and up 36,000 barrels in the Permian from the respective first quarter volumes. Pinedale gas lines were up 2.5 Bcf and Uinta basin gas lines were up 0.8 Bcf.
$QEP 2Q15 Call: Production in the second quarter was 80.9 Bcfe or 5.7 Bcfe higher than the 75.52 Bcfe reported in the first quarter of year. Well volumes were 4.9 million barrels, up 400,000 barrels. NGL volumes were 1.2MM barrels, up 250, 000 barrels. Natural gas volumes were 44.5 Bcf, up 1.9 Bcf from the respective first quarter volumes.