Range Announces Sharply Higher Third Quarter Results

Business Wire, Oct 22, 2008

During the third quarter 2008, Range's Appalachian division continued to focus on its key coal bed methane, tight gas sand and shale drilling projects in our Nora and Widen fields with 63 wells drilled. In the Nora field in Virginia, the division drilled 34 coal bed methane wells on 60-acre spacing and nine infill wells on 30-acre spacing. In addition, Range drilled 17 tight gas sand wells in Nora during the quarter, achieving above average initial production results. Including the downspacing of coal bed methane and tight gas sand wells, the number of remaining drilling locations in Nora could exceed 6,000. On the horizontal drilling front, Range has completed its fifth horizontal Huron Shale well to date in Nora and plans to drill five additional horizontal Huron Shale wells and two horizontal Berea wells by year-end. Several of these wells will not be completed until early 2009. Of the four horizontal Huron Shale wells that are currently on production, the average cost was $1.7 million per well, while the average initial production rate was 1.1 Mmcfe per day, and they continue to produce in line with expectations. If the Huron Shale program is successful, it will de-risk approximately 1.5 Tcf of net gas reserves to Range.

In the Appalachian Basin Marcellus Shale play, Range is ramping up production, expanding infrastructure and adding acreage in key areas. Our acreage position in the fairway is now approaching 900,000 net acres, which equates to more than 15 to 22 Tcfe of net unrisked resource potential. Of that, 10 to 15 Tcfe are located in the southwest part of the play, with the remainder in the northeast. Range's average leasehold cost is $404 per acre. For the leasehold acquired in 2008, the average cost per acre is $1,300. The technical team is making tremendous progress in the area of delineation, well performance and cost improvements. Earlier today, we announced that the first phase of the pipeline and gas processing plant infrastructure is now operational, approximately three months sooner than expected. During 2009, additional infrastructure will be installed, greatly expanding capacity. We currently anticipate exiting 2008 with 30 Mmcfe per day of production and ramping it up to a 80 to 100 Mmcfe per day exit rate at year-end 2009.

In the Fort Worth Basin, third quarter activity was highlighted by drilling success in Hood County where a seven-well package averaged 11.4 days from spud to rig release and achieved average initial production of 2.0 Mmcfe per day per well. These wells were drilled and completed for $1.9 million per well. The effort has been extended onto a new 3,000 acre block immediately adjacent where Range plans to actively drill and complete additional wells. The first two wells on this new acreage block have been completed with initial rates averaging 2.6 Mmcf per day. In southwestern Tarrant County, the Company has spud a 250 foot spaced pilot and is participating in a 330 foot spaced development well in northwestern Ellis County.