Since 2007, EQT has completed over 600 horizontal wells in Eastern Kentucky with multi-stage, open-hole packer systems. Possibly due to the low-pressure nature of the reservoir, EQT has averaged only 53% frac port ball recovery during post-frac flowback. Due to rig restraints, cost concerns, and an unknown potential for production gains, EQT did not elect to immediately mill out the frac sleeves on nearly all of the wells. During 2009, EQT started a frac sleeve millout test program to evaluate the potential production gains due to the removal of the downhole restrictions of the frac sleeves and balls. The candidates were selected based on several criteria, including the well's Estimated Ultimate Recovery (EUR) as compared to its offsets, the type of frac treatment, and the percentage of ball recovery during flowback. When the results from the 10 well test campaign showed measurable production gains, the program was expanded to include 25 additional wells. The gains in reserves from the millouts were calculated by subtracting the previously forecasted reserves from the current expected reserves. The criteria for candidate wells for the 2nd campaign was revised based on the results from the 1st campaign to include the wells' fluid production and the deviation of the upper-most frac port.

Many in the industry are unaware of the potential production and reserve gains from frac sleeve millouts. Six of the 10 wells in the original campaign showed significant daily production gains following millout. Following well optimization (including tubing and plunger lift installation on 3 of the wells), the average EUR from the initial 10 millout wells increased by 119 MMcf, with two wells showing EUR increases of close to 300 MMcf. A well from the second campaign showed an EUR increase of 716 MMcf; other wells showed more moderate increases while some showed no EUR gain at all. After using decline curve analysis, EQT feels confident that the production increases from millouts are incremental gains and not merely accelerated production. Economics run on the project as a whole show significant EUR increases and compelling incremental costs per mcf of reserves added. Based on the well production results, an additional 300 well frac sleeve millout program has been launched and is ongoing.

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