Ascent Resources posts $291 million net loss for 2Q

Natural gas producer Ascent Resources Utica Holdings, LLC in Oklahoma City reported a second quarter net loss of $291 million and an adjusted net loss of $23 million as the COVID-19 pandemic continues to harm the country’s energy industry.

The company said the loss compared to $356 million in net income and $64 million in adjusted net income in the second quarter of 2019. The Company’s adjusted EBITDAX and capital expenditures incurred for the second quarter of 2020 were $211 million and $160 million, respectively.

At mid-June, Ascent re-opened its Ohio and Oklahoma offices following social distancing and sanitation requirements recommended by federal, state and local government agencies.

Ascent had an average net production of 2.5 billions of cubic feet equivalent a day which was a 4% increase over the first quarter production. While the production increased, Ascent’s capital expenditures totaled $160 million and dropped 34% from the first quarter.

The company reported its deliberate multi-year hedge program delivered realizations for the quarter totaling $169 million.

“As shown via our results, Ascent continues to deliver best-in-class operational results of any unconventional resource
play in North America,” said Jeff Fisher, Chairman and Chief Executive Officer.

The company saw a 19% increase from a year ago in the quarter for its average net daily gas production which reached 2,087 mmcfe per day. It was also 4% better than the first quarter of 2020.

Ascent’s second quarter 2020 production consisted of 1,869 mmcf per day of natural gas, 11,319 bbls a day of oil and 24,978 bbls per day of natural gas liquids.

Despite the increased production, Ascent’s debt increased slightly from $2.7 billion at the end of March to $2.8 billion at the end of June. Ascent still has $497 million available on its revolving credit facility after drawing $155 million in letters of credit.

With $9 million in cash on hand, the company had liquidity of $506 million. At the end of June, the company reported what it described as a “robust” hedge portfolio with 1.5 bcf a day of natural gas production hedged for the remainder of the calendar year. The hedge amount was $2.64 per mmbtu or $2.82 per mcf. It also had hedged 4,600 bbls a day of crude oil production at an average price of $39 a barrel for the rest of the year.

The report can be found at:

Ascent is the eighth largest producer of natural gas in the United States in terms of daily production and is focused on
acquiring, exploring for, developing, producing, and operating natural gas and oil properties located in the Utica Shale
in Southeast Ohio.

Source: Ascent Resources