We are maintaining our Neutral recommendation on Range Resources prior to its fourth-quarter 2014 earnings report. In 2014, the company expects to deliver 20 25% annualized production growth. We believe that Range Resources large acreage will support several years of oil and gas drilling in the fast-growing fields. In a dynamic natural gas price environment, the company's record production, declining unit costs and sale of non-core properties will prove beneficial over time. However, at present, we remain on the sidelines as the company is still exposed to a steadily falling crude price environment, interest rate risks and an uncertain macro backdrop. Additionally, Range Resources is governed by several stringent regulations, especially in the Marcellus Shale, the Appalachian Basin and the southwestern U.S., where it has a significant asset base.
Based in Fort Worth, TX, Range Resources Corporation (RRC) is an independent oil and gas company, engaged in the exploration, development and acquisition of oil and gas properties primarily in the southwestern, Appalachian and Gulf Coast regions of the United States. The company's southwestern operations include the Barnett Shale play in north central Texas, the Permian Basin in west Texas and eastern New Mexico as well as the East Texas Basin, the Texas Panhandle and the Anadarko Basin in western Oklahoma. Its Appalachian operations include tight-gas, shale, coal bed methane and conventional oil and gas production in Pennsylvania, Virginia, New York and West Virginia. The company's Gulf Coast operations include Texas, Louisiana and Mississippi. It sells gas to utilities, marketing companies and industrial users.
As of Dec 31, 2013, Range Resources' proved reserves were 8.2 trillion cubic feet equivalent (Tcfe), up 26.1% from year-end 2012. Of the total reserve, 69% was natural gas and 49% was in the proved undeveloped category. In 2013, the company replaced 612% of its production. Range Resources also owns and operates 4,000 miles of gas gathering pipelines in Appalachia, which transport gas to transmission lines and directly to end-users and interstate pipelines.
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