PDC Energy Announces Update to 2020 Operating Plan

DENVER, March 11, 2020 (GLOBE NEWSWIRE) -- PDC Energy, Inc. (“PDC” or the “Company”) (Nasdaq: PDCE) announced today an operational update and changes to its 2020 guidance and 2021 outlook.

The Company expects to reduce its full-year capital investments by 20 to 25 percent compared to its original guidance range of $1.0 to $1.1 billion and projects free cash flow⁽¹⁾ in excess of $150 million for the year. Production is now expected to average similar levels as pro forma 2019 volumes of approximately 200,000 barrels of oil equivalent per day, while oil production is expected to average approximately 73,000 barrels per day.  Both total production and oil production estimates reflect the mid-January closing date of the Company’s merger with SRC Energy. 

The Company will continue to monitor the near and long-term commodity price environment and has short-term contracts with further flexibility to adjust its development plan should it deem necessary.  Given the current conditions, PDC expects to slow its pace of previously planned share repurchases while prioritizing its financial strength and liquidity. Additionally, the Company continues to scrutinize its cost structure with a goal of maintaining its peer-leading metrics. PDC plans to provide a detailed update to its 2020 guidance in the coming weeks.

Operating Plan Changes:

• Upon completion of the current pad, the Company plans to release its Delaware Basin completion crew for the remainder of 2020, deferring ten to 15 previously planned wells into 2021.
  
  
• The Company plans to operate one drilling rig in the Delaware Basin for the remainder of 2020, opting not to deploy a second drilling rig in the second half of 2020, as originally planned.
  
  
• In the Wattenberg Field, PDC plans to reduce its activity during the second quarter of 2020 from three drilling rigs and two completion crews to two drilling rigs and one completion crew.

Consistent with current strip pricing, PDC’s updated operating plan considers a WTI oil price of $35 per barrel for the remainder of 2020 and approximately $40 per barrel in 2021.  Similarly, it assumes NYMEX natural gas prices of approximately $2 per Mcf for the remainder of 2020 and $2.40 per Mcf in 2021 with NGL realizations between $7 and $9 per barrel in both years.  The Company has swaps and collars in place for nearly 60 percent of its updated projected 2020 oil production at a weighted-average floor price of approximately $58 per barrel.