Trump to visit Fed on Thursday amid Powell feud, renovation probe
Introduction & Market Context
Range Resources Corp (NYSE:RRC) released its April 2025 corporate presentation, outlining an ambitious three-year growth strategy that aims to increase production by approximately 19% through 2027 while maintaining a disciplined capital approach. The presentation comes after the company reported mixed fourth-quarter 2024 results, with earnings per share of $0.68 exceeding forecasts but revenue of $626.42 million falling short of expectations.
The company positions itself as a top 10 U.S. producer of natural gas and natural gas liquids (NGLs), with a pure-play focus on the Appalachian basin. Range Resources emphasizes its extensive inventory of over 30 years of core Marcellus assets and its ability to generate durable free cash flow through commodity price cycles.
As shown in the following slide, Range Resources highlights its key strategic positioning:
Three-Year Growth Strategy
The centerpiece of Range’s presentation is its three-year growth plan, which targets increasing production from approximately 2.2 billion cubic feet equivalent per day (Bcfe/day) in 2025 to 2.6 Bcfe/day by 2027. This represents a 19% increase in production over the period, which the company plans to achieve while maintaining an annual capital expenditure of $650-700 million and a reinvestment rate below 50% at a $3.75 natural gas price.
The company’s growth strategy is supported by its extensive Marcellus inventory, which includes 28 million lateral feet of undrilled potential at year-end 2024. Range emphasizes the quality of this inventory, with a significant portion having breakeven prices below $2.50 per thousand cubic feet.
The following slide illustrates Range’s unmatched core Marcellus inventory position:
For 2025, Range Resources plans capital investments of $650-690 million, which includes approximately $530 million for maintenance drilling and completions, $70-100 million for additional in-process well inventory, and smaller allocations for land acquisition and emissions reduction initiatives. This investment plan is designed to support both modest production growth in 2025 and build inventory for increased growth in 2026-2027.
The company’s capital investment plan is detailed in the following slide:
Financial Performance and Capital Allocation
Range Resources has demonstrated consistent free cash flow generation despite volatile commodity prices, reporting $453 million in free cash flow for 2024, following $513 million in 2023, $1.58 billion in 2022, and $656 million in 2021. The company projects cumulative free cash flow of approximately $2.5 billion over the 2025-2027 period based on current price assumptions.
This strong cash flow performance is illustrated in the following chart:
The company’s financial strength is further supported by its improving balance sheet, with leverage expected to fall below 1x Debt/EBITDAX in 2025. Range attributes its financial resilience to several factors, including peer-leading well costs, a low decline rate, and the price uplift from its NGL production.
Range Resources emphasizes its compelling valuation metrics and free cash flow yield potential at various natural gas price points:
The company plans to allocate its free cash flow to a combination of shareholder returns and continued balance sheet improvement. During the recent earnings call, CFO Mark Skucchi indicated the company intends to increase its quarterly dividend by $0.01 per share, or 12.5%, at the next announcement, while maintaining flexibility for share repurchases under its existing $1 billion authorization.
Natural Gas and NGL Market Outlook
Range Resources presents a bullish outlook for both natural gas and NGL markets, citing several key demand drivers. The company notes that the U.S. became the world’s largest LNG exporter in 2023, with exports growing from nearly zero in 2015 to approximately 15 Bcf/day in early 2025.
The company highlights the critical role of natural gas in reducing emissions through coal displacement:
Range also emphasizes the growing power demand, particularly from data centers, which is expected to drive significant natural gas consumption. According to the presentation, PJM (the regional transmission organization) has raised its summer load demand forecast to approximately 50 GW of growth by 2030, which could translate to around 4 Bcf/day of additional natural gas demand if natural gas maintains its current share of generation.
This growing power demand is illustrated in the following slide:
On the NGL front, Range points to strengthening international demand, with global LPG demand expected to grow at a compound annual growth rate of approximately 2.5% through 2030. The company notes that its diversified market access allows it to capture premium pricing for its NGL production, particularly through international exports.
The NGL market outlook is presented in the following slide:
Environmental Initiatives and Governance
Range Resources highlights its environmental achievements, including reaching net zero for Scope 1 and 2 greenhouse gas emissions in 2024. The company emphasizes its low methane emissions and successful water recycling program as key components of its environmental strategy.
The company’s environmental practices are summarized in the following slide:
The presentation also addresses governance and social responsibility, noting board diversity and independence, as well as executive compensation alignment with shareholder interests. Range indicates that its incentive plans have been informed by direct outreach to stakeholders, with annual outreach targeting greater than 65% of shares outstanding.
Forward-Looking Statements
Looking beyond 2027, Range Resources indicates that it could maintain 2.6 Bcfe/day of production with approximately $570 million of annual drilling and completions capital, representing a capital efficiency of $0.60 per Mcfe. This improved maintenance capital requirement reflects continued operational efficiencies and strong well performance.
During the recent earnings call, CEO Dennis Degner stated, "Range’s business has never been stronger," emphasizing the company’s robust financial position and strategic growth plans. CFO Mark Skucchi highlighted the focus on free cash flow, stating, "Our priority is free cash flow," underscoring the company’s commitment to shareholder returns.
The company faces potential challenges, including fluctuating natural gas prices, increasing competition in the natural gas sector, and regulatory changes affecting the energy industry. However, Range believes its diversified market access, extensive inventory, and financial flexibility position it well to navigate these challenges while delivering value to shareholders.
In response to analyst questions during the earnings call, management emphasized a demand-driven approach to growth and highlighted opportunities in both the natural gas and NGL markets. The company’s stock closed at $32.62 on April 22, 2025, with a 52-week range of $27.29 to $41.95, suggesting continued investor interest in Range’s growth strategy and execution capabilities.
Full presentation:
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.