ECR Eclipse Resources Corp.

Eclipse Resources Corporation (NYSE:ECR) (the “Company” or “Eclipse Resources”) today announced its second quarter 2018 financial and operational results, along with reaffirming guidance for full year 2018. In conjunction with this release, the Company has posted an updated corporate presentation in the Investor Center section of its website at www.eclipseresources.com.

Second Quarter 2018 Highlights:

• Average net daily production was 305.5 MMcfe per day, consisting of 72% natural gas and 28% liquids.
• Realized an average natural gas price, before the impact of cash settled derivatives and firm transportation expenses, of $2.72 per Mcf, a $0.08 per Mcf discount to the average monthly NYMEX settled natural gas price during the quarter.
• Realized an average oil price, before the impact of cash settled derivatives, of $61.64 per barrel, a $6.43 per barrel discount to the average daily NYMEX WTI oil price during the quarter.
• Realized an average natural gas liquids (“NGL”) price, before the impact of cash settled derivatives, of $22.99 per barrel, or approximately 34% of the average daily NYMEX WTI oil price during the quarter.
• Per unit cash production costs (including lease operating, transportation, gathering and compression, production and ad valorem taxes) were $1.47 per Mcfe, including $0.41 per Mcfe in firm transportation expenses.
• Net loss for the second quarter of 2018 was ($19.0) million and Adjusted EBITDAX1 for the second quarter of 2018 was $51.1 million.

1 Non-GAAP measure. See reconciliation for details

Benjamin W. Hulburt, Chairman, President and CEO, commented on the Company’s second quarter 2018 results, “This was another solid earnings report with our continued focus on execution, innovation and efficiency, which resulted in the Company delivering what we believe to be another tremendous quarter with cash flows above expectations, capital expenditures below expectations, production above the top end of our guidance range, operating expenses below the low end of our guidance and continued strong well performance in both the dry gas and condensate areas of our acreage.

We have continued our relentless pursuit for industry leading innovation, and have set a new internal record for production on our recent Rolland C 5H “super-lateral”, which we drilled to a total measured depth of 26,027 feet with a 15,285 foot completable lateral in our Utica Dry Gas area. This well was initially turned to sales late in the second quarter of 2018 and flowed at a target rate of approximately 40 Mmcf per day before recently being shut in for offset operator activity. In addition, we continue to be excited with the potential for our Flat Castle acreage in north central Pennsylvania and are currently in the final stages of completion operations on our first operated well, the Painter 2H, which we intend to place into sales during the third quarter of 2018.

For the second quarter of 2018, the Company was able to achieve revenue of $103.6 million, a 20% increase over the second quarter of 2017, while also posting a 29% increase in adjusted EBITDAX1 over the second quarter of 2017, which came in at $51.1 million. We continued to capitalize on our industry leading well costs and operational capabilities, while our per unit cash production costs of $1.47 were better than our second quarter 2018 guidance. From a capital spending perspective, the Company is continuing to manage its plan consistent with the revised $250 million guidance that was previously provided and we believe that our proven operational performance, continued gain in efficiency and financial flexibility leave us well positioned to deliver upon the full year 2018 production guidance that we have issued.

Our strategic and financial review process continues. As we have previously discussed, there is no timetable for the completion of the strategic review process nor any assurance that the review process will result in a transaction or other strategic alternative. The Company will provide further information when and if disclosure is appropriate or required.”

1 Non-GAAP measure. See reconciliation for details

Operational Discussion

The Company’s production for the three and six months ended June 30, 2018 and 2017 is set forth in the following table:

    Three Months Ended Six Months Ended June 30, June 30, 2018   2017 2018   2017 Production: Natural gas (MMcf) 19,985.4 20,127.8 40,328.7 39,509.4 NGLs (Mbbls) 813.6 662.1 1,586.2 1,327.1 Oil (Mbbls) 489.1 347.8 1,054.6 801.9 Total (MMcfe) 27,801.6 26,187.2 56,173.5 52,283.4   Average daily production volume: Natural gas (Mcf/d) 219,620 221,185 222,810 218,284 NGLs (Bbls/d) 8,941 7,276 8,764 7,332 Oil (Bbls/d) 5,375 3,822 5,827 4,430 Total (MMcfe/d) 305.5 287.8 310.4 288.9  

Market Conditions

Prices for various quantities of natural gas, NGLs and oil that we produce significantly impact our revenues and cash flows. Prices for commodities, such as hydrocarbons, are inherently volatile. The following table lists average daily, high, low and average monthly settled NYMEX Henry Hub prices for natural gas and average daily, high and low NYMEX WTI prices for oil for the three and six months ended June 30, 2018 and 2017:

    Three Months Ended Six Months Ended June 30, June 30, 2018   2017 2018   2017 NYMEX Henry Hub High ($/MMBtu) $ 3.08 $ 3.27 $ 6.24 $ 3.71 NYMEX Henry Hub Low ($/MMBtu) 2.74 2.85 2.49 2.44 Average Daily NYMEX Henry Hub ($/MMBtu) 2.85 3.08 2.96 3.05 Average Monthly Settled NYMEX Henry Hub ($/MMBtu) 2.80 3.18 2.90 3.25   NYMEX WTI High ($/Bbl) $ 77.41 $ 53.38 $ 77.41 $ 54.48 NYMEX WTI Low ($/Bbl) 62.03 42.48 59.20 42.48 Average Daily NYMEX WTI ($/Bbl) 68.07 48.10 65.55 49.85  

Financial Discussion

Revenue for the three months ended June 30, 2018 totaled $103.6 million, compared to $86.2 million for the three months ended June 30, 2017. Adjusted Revenue2, which includes the impact of cash settled derivatives and excludes brokered natural gas and marketing revenue, totaled $100.8 million for the three months ended June 30, 2018 compared to $83.6 million for the three months ended June 30, 2017. Net Loss for the three months ended June 30, 2018 was ($19.0) million, or ($0.06) per share, compared to Net Income of $11.5 million, or $0.04 per share, for the three months ended June 30, 2017. Adjusted Net Income2 (Loss) for the three months ended June 30, 2018 was $2.5 million, or $0.01 per share, compared to $(2.8) million, or $(0.01) per share, for the three months ended June 30, 2017. Adjusted EBITDAX2 was $51.1 million for the three months ended June 30, 2018 compared to $39.6 million for the three months ended June 30, 2017.

2 Adjusted Revenue, Adjusted Net Income (Loss) and Adjusted EBITDAX are non-GAAP financial measures. Tables reconciling Adjusted Revenue, Adjusted Net Income (Loss) and Adjusted EBITDAX to the most directly comparable GAAP measures can be found at the end of the financial statements included in this press release.

Average realized price calculations for the three and six months ended June 30, 2018 and 2017 are set forth in the table below:

    Three Months Ended Six Months Ended June 30, June 30, 2018   2017 2018   2017

Average realized price (excluding cash settled derivatives and firm transportation)

Natural gas ($/Mcf) $ 2.72 $ 2.98 $ 2.80 $ 3.07 NGLs ($/Bbl) 22.99 16.84 24.24 21.26 Oil ($/Bbl) 61.64 43.57 58.89 45.02 Total average prices ($/Mcfe) 3.71 3.29 3.80 3.55  

Average realized price (including cash settled derivatives, excluding firm transportation)

Natural gas ($/Mcf) $ 2.84 $ 2.86 $ 2.94 $ 2.94 NGLs ($/Bbl) 22.99 16.38 23.64 20.23 Oil ($/Bbl) 51.94 43.57 52.12 45.11 Total average prices ($/Mcfe) 3.62 3.19 3.76 3.42  

Average realized price (including firm transportation, excluding cash settled derivatives)

Natural gas ($/Mcf) $ 2.16 $ 2.52 $ 2.33 $ 2.56 NGLs ($/Bbl) 22.99 16.84 24.24 21.26 Oil ($/Bbl) 61.64 43.57 58.89 45.02 Total average prices ($/Mcfe) 3.31 2.94 3.46 3.16  

Average realized price (including cash settled derivatives and firm transportation)

Natural gas ($/Mcf) $ 2.27 $ 2.41 $ 2.47 $ 2.43 NGLs ($/Bbl) 22.99 16.38 23.64 20.23 Oil ($/Bbl) 51.94 43.57 52.12 45.11 Total average prices ($/Mcfe) 3.22 2.84 3.42 3.04  

Per unit cash production costs, which include $0.41 per Mcfe of firm transportation expense, were $1.47 per Mcfe for the second quarter of 2018 and increased by 8% compared to the second quarter of 2017. The Company’s cash production costs (which include lease operating, transportation, gathering and compression, production and ad valorem taxes) are shown in the table below.

General and administrative expense was $10.7 million for each of the three months ended June 30, 2018 and 2017 and is shown in the table below. Cash general and administrative expense3, which exclude stock-based compensation expense, were $8.7 million and $8.4 million for the three months ended June 30, 2018 and 2017 respectively. General and administrative expense per Mcfe was $0.38 in the three months ended June 30, 2018 compared to $0.41 in the three months ended June 30, 2017. Cash general and administrative expense3 per Mcfe was $0.31 in the three months ended June 30, 2018 compared to $0.32 in the three months ended June 30, 2017.

3 Cash general and administrative expense is a non-GAAP financial measure. A table reconciling cash general and administrative expense to the most directly comparable GAAP measure can be found at the end of the financial statements included in this press release.

    Three Months Ended Six Months Ended June 30, June 30, 2018   2017 2018   2017 Operating expenses (in thousands): Lease operating $ 7,324 $ 4,568 $ 16,714 $ 6,911 Transportation, gathering and compression 31,371 28,969 59,060 61,846 Production and ad valorem taxes 2,178 2,033 4,623 3,964 Depreciation, depletion and amortization 32,760 25,152 63,916 51,341 General and administrative 10,697 10,730 20,454 20,862 Operating expenses per Mcfe: Lease operating $ 0.26 $ 0.17 $ 0.30 $ 0.13 Transportation, gathering and compression 1.13 1.11 1.06 1.19 Production and ad valorem taxes 0.08 0.08 0.08 0.08 Depreciation, depletion and amortization 1.18 0.96 1.14 0.98 General and administrative 0.38 0.41 0.36 0.40  

Capital Expenditures

Second quarter 2018 capital expenditures were $69.3 million, including $65.6 million for drilling and completions, $5.2 million for midstream expenditures, $(1.9) million for land-related expenditures (which include proceeds associated with the sale of acreage), and $0.4 million for corporate-related expenditures.

During the second quarter of 2018, the Company commenced drilling 6 gross (2.2 net) operated Utica Shale wells, commenced completions of 9 gross (4.2 net) operated wells and turned to sales 9 gross (6.2 net) operated wells.

Financial Position and Liquidity

As of June 30, 2018, the Company’s liquidity was $143.4 million, consisting of $12.0 million in cash and cash equivalents and $131.4 million in available borrowing capacity under the Company’s revolving credit facility (after giving effect to outstanding letters of credit issued by the Company of $33.6 million and $60 million in outstanding borrowings).

Matthew R. DeNezza, Executive Vice President and Chief Financial Officer, commented, “We are again pleased with the level of EBITDAX generated in the second quarter and continue to anticipate strong cash flow growth in the full year 2018. From a pricing perspective, the gas marketing team was able to capture a strong differential through the optimization of our natural gas, while continuing to assume an increase during the second half of 2018 in our operating expenses associated with the Company’s Rover pipeline capacity being fully utilized. As a means of providing additional certainty of cash flows, the majority of our estimated 2018 natural gas production is hedged with an average floor price of $2.93 per MMbtu.”

Commodity Derivatives

The Company engages in a number of different commodity trading program strategies as a risk management tool to attempt to mitigate the potential negative impact on cash flows caused by price fluctuations in natural gas, NGL and oil prices. Below is a table that illustrates the Company’s hedging activities as of June 30, 2018:

Natural Gas Derivatives

 

Volume

    Weighted Average Description

 

(MMBtu/d)

Production Period Price ($/MMBtu) Natural Gas Swaps: 30,000 July 2018 – March 2019 $ 2.90 20,000 July 2018 – December 2018 $ 2.80 20,000 July 2018 – September 2018 $ 2.81 40,000 October 2018 – December 2019 $ 2.80 50,000 January 2019 – December 2019 $ 2.87 Natural Gas Three-way Collars: Floor purchase price (put) 30,000 July 2018 – March 2019 $ 3.00 Ceiling sold price (call) 30,000 July 2018 – March 2019 $ 3.40 Floor sold price (put) 30,000 July 2018 – March 2019 $ 2.50 Floor purchase price (put) 40,000 July 2018 – December 2018 $ 3.11 Floor purchase price (put) 60,000 July 2018 – December 2018 $ 2.80 Ceiling sold price (call) 100,000 July 2018 – December 2018 $ 3.36 Floor sold price (put) 100,000 July 2018 – December 2018 $ 2.50 Floor purchase price (put) 20,000 October 2018 – December 2019 $ 2.75 Ceiling sold price (call) 20,000 October 2018 – December 2019 $ 3.10 Floor sold price (put) 20,000 October 2018 – December 2019 $ 2.30 Floor purchase price (put) 57,500 January 2019 – December 2019 $ 2.72 Ceiling sold price (call) 57,500 January 2019 – December 2019 $ 3.02 Floor sold price (put) 57,500 January 2019 – December 2019 $ 2.30 Natural Gas Call/Put Options: Call sold 40,000 July 2018 – December 2018 $ 3.75 Call sold 30,000 January 2019 – March 2019 $ 3.50 Call sold 30,000 April 2019 – December 2019 $ 3.00 Call sold 10,000 January 2019 – December 2019 $ 4.75 Basis Swaps: Appalachia - Dominion 12,500 April 2019 – October 2019 $ (0.52 ) Appalachia - Dominion 12,500 April 2020 – October 2020 $ (0.52 ) Appalachia - Dominion 20,000 January 2020 – December 2020 $ (0.59 )  

Oil Derivatives

  Volume     Weighted Average Description (Bbls/d) Production Period Price ($/Bbl) Oil Swaps: 1,000 July 2018 – March 2019 $ 61.00 Oil Three-way Collars: Floor purchase price (put) 4,000 July 2018 – December 2018 $ 45.00 Ceiling sold price (call) 4,000 July 2018 – December 2018 $ 53.47 Floor sold price (put) 4,000 July 2018 – December 2018 $ 35.00 Floor purchase price (put) 2,000 January 2019 – December 2019 $ 50.00 Ceiling sold price (call) 2,000 January 2019 – December 2019 $ 60.56 Floor sold price (put) 2,000 January 2019 – December 2019 $ 40.00  

Guidance

The Company has also reaffirmed full year 2018 guidance as set forth in the table below:

  FY 2018 Production MMcfe/d 325 - 335 % Gas 72% - 75% % NGL 13% - 17% % Oil 10% - 13% Gas Price Differential ($/Mcf)1,2 $(0.25) - $(0.35) Oil Differential ($/Bbl)1 $(6.25) - $(7.25) NGL Prices (% of WTI)1 30% - 35% Cash Production Costs ($/Mcfe)3 $1.55 - $1.60 Cash G&A ($mm)4 $35 - $37 CAPEX ($mm) ~$250    

1

 

Excludes impact of hedges

2

Excludes the cost of firm transportation

3

Includes lease operating, transportation, gathering and compression, production and ad valorem taxes

4

Non-GAAP measure which excludes non-cash compensation, see reconciliation to the most comparable GAAP measure at the end of the financial statements included in this press release

 

Conference Call

A conference call to review the Company’s financial and operational results is scheduled for Friday, August 3, 2018 at 10:00 a.m. Eastern Time. To participate in the call, please dial 877-709-8150 or 201-689-8354 for international callers and reference Eclipse Resources Second Quarter Earnings Call. A replay of the call will be available through October 3, 2018. To access the phone replay dial 877-660-6853 or 201-612-7415 for international callers. The conference ID is 13681846. A live webcast of the call may be accessed through the Investor Center on the Company’s website at www.eclipseresources.com. The webcast will be archived for replay on the Company’s website for six months.

  ECLIPSE RESOURCES CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share and per share amounts) (Unaudited)   June 30, December 31, 2018 2017 ASSETS CURRENT ASSETS Cash and cash equivalents $ 12,049 $ 17,224 Accounts receivable 112,166 77,609 Assets held for sale — 206 Other current assets   7,263   12,023 Total current assets 131,478 107,062   PROPERTY AND EQUIPMENT AT COST Oil and natural gas properties, successful efforts method: Unproved properties 547,963 459,549 Proved oil and gas properties, net 716,292 647,881 Other property and equipment, net   6,949   6,942 Total property and equipment, net 1,271,204 1,114,372   OTHER NONCURRENT ASSETS Other assets   3,117   2,093 TOTAL ASSETS $ 1,405,799 $ 1,223,527   LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 111,230 $ 76,174 Accrued capital expenditures 13,689 10,658 Accrued liabilities 49,326 41,662 Accrued interest payable   21,891   21,100 Total current liabilities 196,136 149,594   NONCURRENT LIABILITIES Debt, net of unamortized discount and debt issuance costs 496,397 495,021 Credit facility 60,000 — Asset retirement obligations 6,554 6,029 Other liabilities   3,348   529 Total liabilities 762,435 651,173 COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY

Preferred stock, 50,000,000 authorized, no shares issued and outstanding

— —

Common stock, $0.01 par value, 1,000,000,000 authorized, 302,325,028 and 262,740,355 shares issued and outstanding, respectively

3,040 2,637 Additional paid in capital 2,061,365 1,967,958

Treasury stock, shares at cost; 1,661,915 and 992,315 shares, respectively

(3,236 ) (2,096 ) Accumulated deficit   (1,417,805 )   (1,396,145 ) Total stockholders' equity   643,364   572,354 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,405,799 $ 1,223,527       ECLIPSE RESOURCES CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited)   For the Three Months Ended For the Six Months Ended June 30, June 30, 2018   2017 2018   2017 REVENUES Natural gas, oil and natural gas liquids sales $ 103,257 $ 86,194 $ 213,441 $ 185,625 Brokered natural gas and marketing revenue   365   (3 )   373   2,428 Total revenues 103,622 86,191 213,814 188,053   OPERATING EXPENSES Lease operating 7,324 4,568 16,714 6,911 Transportation, gathering and compression 31,371 28,969 59,060 61,846 Production and ad valorem taxes 2,178 2,033 4,623 3,964 Brokered natural gas and marketing expense 430 6 477 2,466 Depreciation, depletion and amortization 32,760 25,152 63,916 51,341 Exploration 9,620 8,997 24,898 20,577 General and administrative 10,697 10,730 20,454 20,862 Accretion of asset retirement obligations 162 128 317 252 (Gain) loss on sale of assets   (1,553 )   6   (1,820 )   1 Total operating expenses   92,989   80,589   188,639   168,220 OPERATING INCOME (LOSS) 10,633 5,602 25,175 19,833 OTHER INCOME (EXPENSE) Gain (loss) on derivative instruments (16,577 ) 18,177 (20,792 ) 43,274 Interest expense, net (13,092 ) (12,285 ) (26,043 ) (24,747 ) Other income (expense)   —   —   —   (19 ) Total other income (expense), net   (29,669 )   5,892   (46,835 )   18,508 INCOME (LOSS) BEFORE INCOME TAXES (19,036 ) 11,494 (21,660 ) 38,341 INCOME TAX BENEFIT (EXPENSE)   —   —   —   — NET INCOME (LOSS) $ (19,036 ) $ 11,494 $ (21,660 ) $ 38,341   NET INCOME (LOSS) PER COMMON SHARE Basic $ (0.06 ) $ 0.04 $ (0.07 ) $ 0.15 Diluted $ (0.06 ) $ 0.04 $ (0.07 ) $ 0.15   WEIGHTED AVERAGE COMMON SHARES

OUTSTANDING

Basic 301,936 262,423 297,717 261,768 Diluted 301,936 264,420 297,717 264,321  

Adjusted Revenue

Adjusted revenue is a non-GAAP financial measure. The Company defines adjusted revenue as follows: total revenues plus net cash receipts or payments on settled derivative instruments less brokered natural gas and marketing revenue. The Company believes adjusted revenue provides investors with helpful information with respect to the performance of the Company’s operations and management uses adjusted revenue to evaluate its ongoing operations and for internal planning and forecasting purposes. See the table below, which reconciles adjusted revenue and total revenues.

    For the Three Months Ended For the Six Months Ended June 30, June 30, $ thousands 2018   2017 2018   2017 Total revenues $ 103,622 $ 86,191 $ 213,814 $ 188,053 Net cash receipts (payments) on derivative instruments (2,488 ) (2,644 ) (2,347 ) (6,633 ) Brokered natural gas and marketing revenue   (365 )   3   (373 )   (2,428 ) Adjusted revenue $ 100,769 $ 83,550 $ 211,094 $ 178,992  

Adjusted Net Income (Loss)

Adjusted net income (loss) represents income (loss) before income taxes adjusted for certain non-cash items as set forth in the table below. We believe adjusted net income (loss) is used by many investors and published research in making investment decisions and evaluating operational trends of the Company and its performance relative to other oil and gas producing companies. Adjusted net income (loss) is not a measure of net income (loss) as determined by GAAP. See the table below for a reconciliation of adjusted net income (loss) and net income (loss).

    Three Months Ended

Six Months Ended

June 30,

June 30,

$ thousands 2018   2017 2018   2017 Income (loss) before income taxes, as reported $ (19,036 ) $ 11,494 $ (21,660 ) $ 38,341 (Gain) loss on derivative instruments 16,577 (18,177 ) 20,792 (43,274 ) Net cash receipts (payments) on derivative instruments (2,488 ) (2,644 ) (2,347 ) (6,633 ) Dry hole and other 2 79 96 942 Stock-based compensation 1,979 2,348 3,960 4,429 Impairment of unproved properties 6,971 4,125 13,667 8,250 Other (income) expense — — — 19 (Gain) loss on sale of assets   (1,553 )   6   (1,820 )   1 Loss before income taxes, as adjusted   2,452   (2,769 )   12,688   2,075 Adjusted net income (loss) $ 2,452 $ (2,769 ) $ 12,688 $ 2,075   Net income (loss) per Common Share Basic $ (0.06 ) $ 0.04 $ (0.07 ) $ 0.15 Diluted $ (0.06 ) $ 0.04 $ (0.07 ) $ 0.15   Adjusted net income (loss) per Common Share Basic $ 0.01 $ (0.01 ) $ 0.04 $ 0.01 Diluted $ 0.01 $ (0.01 ) $ 0.04 $ 0.01   Weighted Average Common Shares Outstanding Basic 301,936 262,423 297,717 261,768 Diluted 301,936 264,420 297,717 264,321  

Adjusted EBITDAX

Adjusted EBITDAX is a supplemental non-GAAP measure that is used by the Company to evaluate its financial results. The Company defines Adjusted EBITDAX as net income or loss before interest expense; income taxes; impairments; depreciation, depletion and amortization (“DD&A”); gain (loss) on derivative instruments, net cash receipts (payments on settled derivative instruments, and premiums (paid) received on options that settled during the period); non-cash compensation expense; gain or loss from sale of interest in gas properties; exploration expenses; and other unusual or infrequent items set forth in the table below. Adjusted EBITDAX is not a measure of net income or loss as determined by GAAP. See the table below for a reconciliation of Adjusted EBITDAX to net income or net loss.

    Three Months Ended Six Months Ended June 30, June 30, $ thousands 2018   2017   2018   2017 Net income (loss) $ (19,036 ) $ 11,494 $ (21,660 ) $ 38,341 Depreciation, depletion and amortization 32,760 25,152 63,916 51,341 Exploration expense 9,620 8,997 24,898 20,577 Stock-based compensation 1,979 2,348 3,960 4,429 Accretion of asset retirement obligations 162 128 317 252 (Gain) loss on sale of assets (1,553 ) 6 (1,820 ) 1 (Gain) loss on derivative instruments 16,577 (18,177 ) 20,792 (43,274 ) Net cash receipts (payments) on settled derivatives (2,488 ) (2,644 ) (2,347 ) (6,633 ) Interest expense, net 13,092 12,285 26,043 24,747 Other (income) expense   —   —   —   19 Adjusted EBITDAX $ 51,113 $ 39,589 $ 114,099 $ 89,800  

Cash General and Administrative Expenses

Cash General and Administrative Expenses is a non-GAAP financial measure used by the Company in the Guidance Table to provide a measure of administrative expenses used by many investors and published research in making investment decisions and evaluating operational trends of the Company. See the table below for a reconciliation of Cash General and Administrative Expenses and General and Administrative Expenses.

      Guidance For the Three Months For the Three Months For the Year Ending $ thousands Ended June 30, 2018 Ended June 30, 2017 December 31, 2018

General and administrative expenses, estimated to be reported

$ 10,697 $ 10,730 $43,500-$47,500 Stock-based compensation expense   (1,979 )   (2,348 ) (8,500 - 10,500) Cash general and administrative expenses $ 8,718 $ 8,382 $35,000-$37,000  

About Eclipse Resources

Eclipse Resources is an independent exploration and production company engaged in the acquisition and development of oil and natural gas properties in the Appalachian Basin, including the Utica and Marcellus Shales. For more information, please visit the Company’s website at www.eclipseresources.com.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of historical fact included in this press release, regarding Eclipse Resources’ strategy, future operations, financial position, estimated revenues and income/losses, projected costs and capital expenditures, prospects, plans and objectives of management are forward-looking statements. When used in this press release, the words “plan,” “endeavor,” “will,” “would,” “could,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on Eclipse Resources’ current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements described under the heading “Risk Factors” in Eclipse Resources’ Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 3, 2018 (the “2017 Annual Report”), and in “Item 1A. Risk Factors” of Eclipse Resources’ Quarterly Reports on Form 10-Q.

Forward-looking statements may include, but are not limited to, statements about Eclipse Resources’ business strategy; reserves; general economic conditions; financial strategy, liquidity and capital required for developing its properties and timing related thereto; realized prices for natural gas, NGLs and oil and the volatility of those prices; write-downs of its natural gas and oil asset values due to declines in commodity prices; timing and amount of future production of natural gas, NGLs and oil; its hedging strategy and results; future drilling plans; competition and government regulations, including those related to hydraulic fracturing; the anticipated benefits under its commercial agreements; marketing of natural gas, NGLs and oil; leasehold and business acquisitions and joint ventures; the expiration of primary terms of oil and gas leases before production can be established and as costs to extend such terms; the costs, terms and availability of gathering, processing, fractionation and other midstream services; credit markets; uncertainty regarding its future operating results, including initial production rates and liquid yields in its type curve areas; and plans, objectives, expectations and intentions contained in this press release that are not historical, including, without limitation, the guidance set forth herein..

Eclipse Resources cautions you that all these forward-looking statements are subject to risks and uncertainties, most of which are difficult to predict and many of which are beyond the Company’s control, incident to the exploration for and development, production, gathering and sale of natural gas, NGLs and oil. These risks include, but are not limited to, legal and environmental risks, drilling and other operating risks, regulatory changes, commodity price volatility and the significant decline of the price of natural gas, NGLs, and oil from historical highs, inflation, lack of availability of drilling, production and processing equipment and services, counterparty credit risk, the uncertainty inherent in estimating natural gas, NGLs and oil reserves and in projecting future rates of production, cash flow and access to capital, risks associated with the Company’s level of indebtedness, the timing of development expenditures, and the other risks described under the heading “Risk Factors” in the 2017 Annual Report and in “Item 1A. Risk Factors” of Eclipse Resources’ Quarterly Reports on Form 10-Q.

All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that Eclipse Resources or persons acting on the Company’s behalf may issue. Except as otherwise required by applicable law, Eclipse Resources disclaims any duty to update any forward-looking statements to reflect events or circumstances after the date of this press release.

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Eclipse Resources CorporationDouglas Kris, 814-325-2059Investor Relationsdkris@eclipseresources.com