Range Resources Corp. said Jan. 8 it expects a significant charge in the fourth quarter related to its oil and gas properties in North Louisiana, as U.S. natural gas prices trade near two-decade lows.
The company's shares were down 4.7% at $4.50 at midday.
The announcement comes nearly a month after the No. 2 U.S. oil producer Chevron Corp. said it expects a writedown of $10 billion to $11 billion in the fourth quarter related to a deepwater Gulf of Mexico project and shale gas in Appalachia.
Range Resources, like other producers, is pressured by a glut of shale gas coming from fields in Texas, Oklahoma and Pennsylvania.
RELATED:
Range Resources Goes ‘Ex-growth,’ Suspends Dividend
A long, steady increase in U.S. shale gas production—much of it a byproduct of the shale oil boom—has hit prices for the fuel. Oil producers are selling shale gas at low prices to get more lucrative oil to market.
U.S. natural gas futures are trading at about $2.13 per million British Thermal Units (mmBTU), and energy consultancy IHS Markit forecasts the price could average below $2/mmBTU this year.
Range Resources has significant holdings in the Marcellus Shale gas field in the eastern U.S., where pipeline constraints have worsened local pricing.
Shale producers have also been pushed by investors to cut back spending and focus on higher returns and debt reduction instead as oil and gas prices continue to be volatile amid global uncertainties.
On Jan. 6, Range Resources said it would cut its capex by around 29% to about $520 million this year, and suspended its dividend.
However, the company said Jan. 8 it does not expect to record any impairments related to properties in the Appalachian Basin.
Recommended Reading
SCF Acquires Flowchem, Val-Tex and Sealweld
2024-03-04 - Flowchem, Val-Tex and Sealweld were formerly part of Entegris Inc.
Enbridge Closes First Utility Transaction with Dominion for $6.6B
2024-03-07 - Enbridge’s purchase of The East Ohio Gas Co. from Dominion is part of $14 billion in M&A the companies announced in September.
Pembina Cleared to Buy Enbridge's Pipeline, NGL JV Interests for $2.2B
2024-03-19 - Pembina Pipeline received a no-action letter from the Canadian Competition Bureau, meaning that the government will not challenge the company’s acquisition of Enbridge’s interest in a joint venture with the Alliance Pipeline and Aux Sable NGL fractionation facilities.
Global Partners Buys Four Liquid Energy Terminals from Gulf Oil
2024-04-10 - Global Partners initially set out to buy five terminals from Gulf Oil but the purchase of a terminal in Portland was abandoned after antitrust concerns were raised by the FTC and the Maine attorney general.
Eni, Vår Energi Wrap Up Acquisition of Neptune Energy Assets
2024-01-31 - Neptune retains its German operations, Vår takes over the Norwegian portfolio and Eni scoops up the rest of the assets under the $4.9 billion deal.