Penn Virginia (PVA) Updates Outlook; Sees Some Delays in Completion of H214 Drilling Program

Penn Virginia (NYSE: PVA) announced updated guidance for the second half of 2014. PVA also announced it has released a new investor presentation and its upcoming investor conference schedule.

Guidance Update

Although well results continue to meet or exceed expectations, we anticipate delays in the timing of completions associated with our second half of 2014 drilling program, including those wells to be drilled with the recently added seventh and eighth drilling rigs. In addition, as a result of the delays, we now expect four (2.5 net) fewer wells will be turned in line in 2014, with those four wells now expected to be turned in line during the first quarter of 2015.

During the second half of 2014, production is now expected to range between 23.4 and 25.5 thousand barrels of oil equivalent per day (MBOEPD), with production of 20.8 to 22.0 MBOEPD expected during the third quarter and 26.0 to 29.0 MBOEPD expected in the fourth quarter.

Pro forma for the sale of our Mississippi assets, which closed at the end of July, we now expect a one to seven percent increase in production in the third quarter over the second quarter and a 29 to 36 percent increase in production in the fourth quarter over the third quarter. Our Eagle Ford production is expected to increase approximately 50 to 60 percent in the second half of 2014 over the first half, driven by continued well completions and anticipated strong well results.

As a result of this reduced 2014 completion activity, second half 2014 capital expenditures are expected to range between $380 and $420 million. Adjusted EBITDAX, which includes the cash impact of derivatives, for the second half of 2014 is expected to range between $210 and $245 million. We anticipate having no outstanding borrowings under our revolving credit facility and financial liquidity of nearly $500 million at the end of the year.

These second half 2014 estimates are meant to provide guidance only and are subject to revision as our operating environment changes.

Our preliminary estimate for 2015 total production is 35 to 45 percent higher than 2014, with oil production 45 to 60 percent higher than 2014. 2015 capital expenditures are expected to range between $750 and $800 million with adjusted EBITDAX that will be between 35 and 40 percent higher than 2014.

The preliminary estimates for full-year 2015 are meant to provide guidance only and are subject to revision as our 2015 budget is finalized.

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