Cabot Oil & Gas says that its Marcellus initiative in northeastern Pennsylvania is gaining momentum and is currently producing over 13 Mmcfe per day. Most recently, Cabot completed its first Marcellus horizontal well with a measured depth of 8,925' and a horizontal leg at 2,000' using a six-stage frac. The result was a 24-hour average initial production rate of 6.4 Mmcf per day. "Adding this to our series of vertical wells, which have been turned in line over the last five months and have a 30-day average IP of 750 Mcf per day, has allowed Cabot to exceed our original year-end Marcellus production target of six to nine Mmcf per day," said Dan O. Dinges, Chairman, President and Chief Executive Officer. "We expect this to increase considerably over the next few weeks as we have nine additional wells (six vertical and three horizontal) ready to be completed or in the final stages of pipeline hookup."

To date, the Company has drilled 18 total wells in the field, four of these as horizontal tests. Five rigs are currently working with plans to increase to eight rigs in 2009. "Our 2008 program will be 16 vertical wells plus seven horizontal wells," added Dinges. Cabot has four vertical wells and three horizontal wells remaining to be drilled this year and will continue operations seamlessly into 2009. Total well costs range between $1.3 million to $1.5 million for a typical vertical well and $2.6 million to $2.9 million for a horizontal well. The average depth of a vertical well is 7,200'; the average horizontal leg is approximately 2,200'.

In terms of infrastructure, the Company has completed its first phase pipeline build-out totaling 10 miles and has started up its first compressor with a second unit on site and ready to be utilized once production volumes justify the need. "We continue to actively secure rights of way and gain permits to expand our pipeline infrastructure for our 2009 drilling program," commented Dinges.

Tags: Cabot Oil & Gas Corporation