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Penn Virginia Corporation Provides Oil and Gas Operational Update.

Article Excerpt
Resumed Drilling in the Granite Wash and Lower Bossier (Haynesville) Shale Plays

Increased Production Guidance for 2009 and Preliminary 2010 Guidance

Six Percent Increase in Production over Prior Year Quarter

Plans to Exit Gulf Coast in Fourth Quarter of 2009

RADNOR, Pa. -- Penn Virginia Corporation (NYSE:PVA) today provided an update of its oil and gas operational activities, including third quarter 2009 results and full-year 2009 and preliminary full-year 2010 guidance.

Highlights

Oil and gas segment operational results during the third quarter of 2009 included the following:

* Quarterly oil and gas production of 134.9 million cubic feet of natural gas equivalent (MMcfe) per day, or 12.4 billion cubic feet of natural gas equivalent (Bcfe), representing production growth of six percent from 127.1 MMcfe per day, or 11.7 Bcfe, in the third quarter of 2008 (nine percent less than 148.9 MMcfe per day, or 13.6 Bcfe, produced in the second quarter of 2009);

* Oil and gas capital expenditures of approximately $16 million, including approximately $8 million for drilling and completion activities;

* Two (0.8 net) Granite Wash wells drilled, one of which was successful and the other of which is waiting on completion; and

* Initiated the process of selling our Gulf Coast properties and expect to complete a transaction during the fourth quarter of 2009. In connection with this divestiture, we incurred a non-cash impairment charge on proved properties held for sale of $87.9 million in the third quarter.

Full-Year 2009 and Preliminary 2010 Guidance Update

Full-year 2009 guidance updates are as follows:

* Production guidance of approximately 136 to 140 MMcfe per day, or 49.5 to 51.0 Bcfe, an increase of 1.0 to 1.5 Bcfe over previous guidance due to better than expected third quarter volumes. This production guidance range represents production growth of six to nine percent over 2008 production of approximately 128 MMcfe per day, or 46.9 Bcfe. Based on the first nine months' production of 39.7 Bcfe, we estimate fourth quarter 2009 production to be in the range of approximately 107 to 123 MMcfe per day, or 9.8 to 11.3 Bcfe. The expected sequential decrease in production is due to natural production declines and the expected sale of the Gulf Coast assets; and

* Oil and gas capital expenditures guidance of $216.0 to $228.7 million, which is $48.7 to $51.0 million higher than the previous guidance range. The increase in guidance is primarily due to the resumption of PVA-operated drilling in the Lower Bossier (Haynesville) Shale in East Texas and an expanded leasehold acquisition effort in the Marcellus Shale,...

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