Range Resources Corporation (RRC): Business Model Canvas [10-2024 Updated]
- ✓ Fully Editable: Tailor To Your Needs In Excel Or Sheets
- ✓ Professional Design: Trusted, Industry-Standard Templates
- ✓ Pre-Built For Quick And Efficient Use
- ✓ No Expertise Is Needed; Easy To Follow
Range Resources Corporation (RRC) Bundle
Discover how Range Resources Corporation (RRC) strategically navigates the complex landscape of the energy sector with its innovative business model. From forging vital partnerships to optimizing key activities that drive production, RRC's approach encompasses a robust framework that ensures reliability and efficiency. Dive deeper into the elements that define RRC's success, including its diverse customer segments and sustainable value propositions, all while maintaining a keen focus on maximizing shareholder value.
Range Resources Corporation (RRC) - Business Model: Key Partnerships
Collaborations with suppliers for drilling equipment
Range Resources Corporation partners with various suppliers for drilling equipment essential for their operations. In the first nine months of 2024, the company reported capital expenditures of $478.4 million, primarily allocated to the development and acquisition of natural gas properties, which includes investments in drilling equipment.
Partnerships with local transportation firms for logistics
Range engages local transportation firms to manage logistics effectively. The company reported transportation, gathering, processing, and compression expenses of $306.2 million in the third quarter of 2024, up from $277.2 million in the same quarter of 2023. This increase reflects the company's reliance on third-party transportation services to handle its growing production volumes.
| Type | Q3 2024 Expense (in millions) | Q3 2023 Expense (in millions) | Change (in millions) | % Change |
|---|---|---|---|---|
| Transportation, gathering, processing, and compression | $306.2 | $277.2 | $28.9 | 10% |
Alliances with technology providers for exploration tools
Range Resources collaborates with technology providers to enhance exploration capabilities. In 2024, the company allocated $7.3 million for exploration expenses in the third quarter, slightly up from $7.0 million in the same quarter of 2023. This investment underscores the importance of technological advancements in improving exploration efficiency.
| Type | Q3 2024 Exploration Expense (in millions) | Q3 2023 Exploration Expense (in millions) | Change (in millions) | % Change |
|---|---|---|---|---|
| Exploration Expenses | $7.3 | $7.0 | $0.3 | 4.3% |
Relationships with regulatory bodies for compliance
Range maintains relationships with various regulatory bodies to ensure compliance with industry regulations. The effective tax expense for the company was $15.6 million in the third quarter of 2024, reflecting the cost of compliance and regulatory obligations. Additionally, the company has hedged over 50% of its projected natural gas production for the remainder of 2024, showcasing its proactive approach to managing regulatory and market risks.
| Type | Q3 2024 Tax Expense (in millions) | Q3 2023 Tax Expense (in millions) | Change (in millions) |
|---|---|---|---|
| Income Tax Expense | $15.6 | $15.7 | ($0.1) |
Range Resources Corporation (RRC) - Business Model: Key Activities
Exploration and production of natural gas and oil
Range Resources Corporation focuses on the exploration and production of natural gas, natural gas liquids (NGLs), and oil primarily in the Appalachian region. In the first nine months of 2024, the company reported a total production of 593,605 million cubic feet equivalent (mcfe), which represents a 3% increase compared to 577,490,000 mcfe in the same period of 2023. The breakdown of production is as follows:
| Type | Production (units) | Change (%) |
|---|---|---|
| Natural Gas (mcf) | 406,943,086 | 3% |
| NGLs (bbls) | 29,392,292 | 4% |
| Oil (bbls) | 1,717,958 | -6% |
Drilling and completion of new wells
Range Resources actively engages in drilling and completing new wells to sustain and enhance production capabilities. In the third quarter of 2024, the company drilled 14 new wells, maintaining a focus on efficiency and cost control. The average cost for drilling and completing a new well in 2024 was approximately $5.2 million, reflecting a disciplined capital expenditure strategy amid fluctuating commodity prices.
Maintenance of existing production facilities
Ongoing maintenance of production facilities is critical for Range Resources to ensure operational efficiency and minimize downtime. The company reported direct operating expenses of $0.12 per thousand cubic feet equivalent (mcfe) in the third quarter of 2024, consistent with the same period in 2023. For the first nine months of 2024, the total direct operating expenses were approximately $70.2 million, which showcases the company's commitment to maintaining its infrastructure.
Risk management through commodity hedging
Range Resources employs a comprehensive risk management strategy that includes commodity hedging to protect against price volatility. As of September 30, 2024, the company had hedged over 50% of its projected natural gas production for the remainder of the year. In the third quarter of 2024, derivative fair value income was reported at $47.1 million, compared to $38.4 million for the same period in 2023. This highlights the effectiveness of their hedging strategy in mitigating risks associated with fluctuating commodity prices.
| Period | Derivative Fair Value Income (in millions) |
|---|---|
| Q3 2024 | $47.1 |
| Q3 2023 | $38.4 |
| First Nine Months 2024 | $110.5 |
| First Nine Months 2023 | $530.1 |
Range Resources Corporation (RRC) - Business Model: Key Resources
Large reserves of natural gas, NGLs, and oil
Range Resources Corporation has significant reserves that are critical to its operations. As of September 30, 2024, the company reported the following production volumes:
| Resource Type | Production (Nine Months Ended September 30, 2024) | Production (Nine Months Ended September 30, 2023) | Change (%) |
|---|---|---|---|
| Natural Gas (mcf) | 406,943,086 | 396,367,927 | 2% |
| NGLs (bbls) | 29,392,292 | 28,368,181 | 4% |
| Oil (bbls) | 1,717,958 | 1,818,773 | -6% |
Skilled workforce in engineering and operations
Range Resources Corporation employs a highly skilled workforce essential for its operational efficiency. The company invests in continuous training and development, particularly in engineering and operational roles, to maintain high productivity levels. This skilled workforce contributes to the effective management of drilling operations and resource extraction.
Advanced drilling and extraction technology
Range Resources utilizes state-of-the-art drilling and extraction technologies to enhance operational efficiency. The average realized price received during the third quarter of 2024 was $1.67 per mcfe, reflecting the effectiveness of their technology in maximizing output against varying market conditions. The company reported:
| Expense Type | Cost per mcfe (Q3 2024) | Cost per mcfe (Q3 2023) | Change (%) |
|---|---|---|---|
| Direct Operating Expense | $0.12 | $0.12 | 0% |
| Transportation, Gathering, Processing, and Compression | $1.51 | $1.42 | 6% |
Strong financial position with substantial liquidity
As of September 30, 2024, Range Resources maintained a robust financial position, highlighted by:
- Cash on hand: $277.5 million
- Available credit under bank facilities: $1.3 billion
- Total liquidity: approximately $1.6 billion
During the first nine months of 2024, the company generated $726.6 million from operating activities, demonstrating effective cash flow management despite fluctuating commodity prices.
Range Resources Corporation (RRC) - Business Model: Value Propositions
Reliable supply of natural gas and oil
Range Resources Corporation (RRC) maintains a robust supply chain, ensuring a reliable delivery of natural gas and oil products. The company's average daily production was approximately 2.2 Bcfe for the nine months ended September 30, 2024, compared to 2.1 Bcfe for the same period in 2023, reflecting a production increase of about 4% year-over-year.
Competitive pricing through operational efficiencies
RRC's operational efficiencies contribute significantly to its competitive pricing strategy. For the third quarter of 2024, the direct operating expense per mcfe was maintained at $0.12, consistent with the same period in 2023. The transportation, gathering, processing, and compression costs per mcfe increased slightly to $1.51 in Q3 2024 from $1.42 in Q3 2023.
| Cost Type | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Direct Operating Expense per mcfe | $0.12 | $0.12 | 0% |
| Transportation, Gathering, Processing and Compression per mcfe | $1.51 | $1.42 | 6.3% |
Commitment to environmental sustainability
Range Resources is committed to environmental sustainability through various initiatives aimed at reducing its carbon footprint. The company has implemented advanced technologies and practices to minimize emissions during extraction and production processes. As of September 30, 2024, RRC has hedged more than 50% of its projected natural gas production for the remainder of 2024, which is a strategic move to mitigate price volatility and support sustainable practices.
Focus on maximizing shareholder value
RRC emphasizes maximizing shareholder value through consistent dividends and share repurchase programs. In the third quarter of 2024, the company paid dividends totaling $19.3 million, or $0.08 per share. Additionally, RRC repurchased approximately $24.0 million of its common stock. For the first nine months of 2024, total dividends paid were $58.1 million, maintaining a steady return to shareholders.
| Financial Metrics | Q3 2024 | Q3 2023 |
|---|---|---|
| Dividends Paid | $19.3 million | $19.3 million |
| Common Stock Repurchased | $24.0 million | N/A |
| Total Dividends (YTD) | $58.1 million | $57.9 million |
Range Resources Corporation (RRC) - Business Model: Customer Relationships
Direct engagement with industrial and commercial clients
Range Resources Corporation (RRC) maintains robust relationships with its industrial and commercial clients by providing tailored solutions for natural gas, NGLs, and oil supply. During the first nine months of 2024, RRC reported natural gas sales of $715.3 million, down 22% from $913.9 million in the same period of 2023, reflecting price volatility and market conditions.
Long-term contracts with utility companies
RRC has established long-term contracts with various utility companies, which ensure a stable revenue stream. These contracts are pivotal in securing consistent demand for RRC's products. In the first nine months of 2024, total natural gas, NGLs, and oil sales reached $1.578 billion, although this was a decline of 9% from $1.731 billion in the same timeframe of the previous year.
Responsive customer service for supply inquiries
RRC emphasizes responsive customer service, addressing supply inquiries effectively. The company generated $726.6 million in cash from operating activities in the first nine months of 2024, showcasing its operational efficiency and ability to manage customer demands. The average daily production during this period was approximately 2.2 Bcfe, indicating a strong capacity to fulfill customer orders.
Transparency in pricing and service delivery
Transparency in pricing is a critical aspect of RRC's customer relationships. The average realized price for natural gas in the third quarter of 2024 was $1.67 per mcfe, remaining stable compared to the same quarter in 2023. RRC’s commitment to clear pricing strategies enhances trust with its customers, which is essential for long-term business relationships.
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Natural Gas Sales ($ million) | $234.1 | $247.0 | -5% |
| NGLs Sales ($ million) | $266.2 | $238.2 | 12% |
| Oil Sales ($ million) | $32.9 | $41.5 | -21% |
| Total Sales ($ million) | $533.3 | $526.7 | 1% |
| Cash from Operating Activities ($ million) | $726.6 | $751.8 | -3.3% |
Overall, RRC's approach to customer relationships involves direct engagement, long-term contracts, responsive service, and pricing transparency, all contributing to its business model and operational success in 2024.
Range Resources Corporation (RRC) - Business Model: Channels
Direct sales to utility companies and industrial clients
Range Resources Corporation (RRC) engages in direct sales of natural gas, NGLs, and oil to utility companies and industrial clients. In the third quarter of 2024, the company reported total natural gas, NGLs, and oil sales of $533.3 million, representing a slight increase of 1% compared to $526.7 million in the same quarter in 2023. The direct sales strategy allows RRC to establish strong relationships with key customers, ensuring a stable revenue stream.
Online platforms for market updates and investor relations
RRC utilizes its website and online platforms to provide real-time market updates and investor relations information. This includes quarterly earnings releases, investor presentations, and detailed information about the company's operations. For the first nine months of 2024, RRC generated $726.6 million in cash from operating activities, which reflects the company’s engagement with investors through these online channels.
Participation in industry conferences and trade shows
RRC actively participates in industry conferences and trade shows to enhance its visibility and network with potential clients and partners. These events allow RRC to showcase its operational capabilities and innovations. In 2024, the company continued to focus on enhancing its market presence, contributing to its overall strategy for revenue generation.
Partnerships with brokers for wider market access
RRC has established partnerships with brokers to expand its market access. This approach enables the company to reach a broader customer base, facilitating sales and distribution of its products. The company's revenue from the sale of natural gas, NGLs, and oil (including cash settlements on derivatives) saw a 1% increase in the first nine months of 2024, indicating the effectiveness of these partnerships.
| Channel Type | Details | Financial Impact (Q3 2024) |
|---|---|---|
| Direct Sales | Sales to utility companies and industrial clients | $533.3 million |
| Online Platforms | Market updates and investor relations | $726.6 million in cash from operations |
| Industry Conferences | Participation to enhance visibility and networking | Contributed to overall market presence |
| Broker Partnerships | Wider market access through established brokers | 1% increase in revenue from natural gas, NGLs, and oil sales |
Range Resources Corporation (RRC) - Business Model: Customer Segments
Utility companies requiring stable energy sources
Range Resources Corporation supplies natural gas to various utility companies that rely on stable energy sources for electricity generation. In 2024, utility companies accounted for approximately 47% of Range's total natural gas sales. The average sales price per mcf to utility companies was around $1.51, with total sales reaching approximately $715 million in the first nine months of 2024.
Industrial clients in manufacturing and processing sectors
The industrial sector is a significant customer segment for Range Resources, particularly in manufacturing and processing. This segment represented about 32% of the total sales volume. The average realized price for industrial clients was approximately $1.69 per mcf, contributing to total revenues of about $533 million from industrial sales in 2024. The demand in this sector has been stable, driven by ongoing manufacturing activities and the need for reliable energy sources.
Regional markets in the Appalachian region
Range Resources primarily operates in the Appalachian region, which is a key area for natural gas production and consumption. The company’s customer base in this region includes local utilities and businesses. The Appalachian market accounted for approximately 60% of Range's total production in 2024, with an average daily production of 1.5 Bcf. The average realized price in this market was $1.76 per mcf, with total revenues from the Appalachian region reaching about $1.2 billion in the first nine months of 2024.
Institutional investors interested in energy sector returns
Range Resources also targets institutional investors looking for stable returns in the energy sector. In 2024, Range maintained a dividend payout of $0.08 per share, with a total dividend payment of approximately $58.1 million in the first nine months. Institutional investors accounted for about 38% of the company’s shareholder base, reflecting their interest in the company’s financial performance and growth potential.
| Customer Segment | Percentage of Total Sales | Average Sales Price (per mcf) | Total Sales Revenue (in millions) |
|---|---|---|---|
| Utility companies | 47% | $1.51 | $715 |
| Industrial clients | 32% | $1.69 | $533 |
| Appalachian regional markets | 60% | $1.76 | $1,200 |
| Institutional investors | 38% | N/A | $58.1 (dividends) |
Range Resources Corporation (RRC) - Business Model: Cost Structure
Significant operational costs related to drilling and extraction
In the third quarter of 2024, Range Resources Corporation reported direct operating expenses of $25.3 million, which includes costs associated with drilling and extraction activities. The direct operating expense per thousand cubic feet equivalent (mcfe) was $0.12, unchanged from the same period in 2023. For the first nine months of 2024, direct operating expenses totaled $70.2 million, showing a slight decrease from $73.4 million in the same period of 2023.
Transportation and processing expenses for natural gas and oil
Transportation, gathering, processing, and compression expenses amounted to $306.2 million in the third quarter of 2024, compared to $277.2 million in the third quarter of 2023, reflecting a 10% increase. For the first nine months of 2024, these expenses totaled $878.5 million, a 6% increase from $830.9 million in the same period of 2023. The following table summarizes transportation, gathering, processing, and compression expenses:
| Expense Type | Q3 2024 (in thousands) | Q3 2023 (in thousands) | Change (%) |
|---|---|---|---|
| Natural Gas | $153,063 | $142,202 | 8% |
| NGLs | $152,624 | $134,754 | 13% |
| Oil | $467 | $251 | 86% |
| Total | $306,154 | $277,207 | 10% |
General and administrative costs for corporate operations
General and administrative expenses per mcfe were reported at $0.20 for the third quarter of 2024, consistent with the same period in 2023. For the first nine months of 2024, general and administrative expenses remained stable at $0.21 per mcfe, similar to the previous year.
Capital expenditures for technology and infrastructure
For the nine months ended September 30, 2024, Range Resources Corporation incurred capital expenditures of $432.3 million for additions to natural gas properties, reflecting a slight increase from $421.1 million in the same period of 2023. The company maintains a focus on investing in technology and infrastructure to enhance operational efficiency and production capabilities.
Range Resources Corporation (RRC) - Business Model: Revenue Streams
Sales from natural gas, NGLs, and oil
For the third quarter of 2024, Range Resources reported total revenue from the sale of natural gas, NGLs (Natural Gas Liquids), and oil amounting to $533.3 million, a slight increase of 1% compared to $526.7 million in the same quarter of 2023. For the first nine months of 2024, the revenue decreased to $1.58 billion, down 9% from $1.73 billion in the prior year.
| Product | Q3 2024 Revenue (in million) | Q3 2023 Revenue (in million) | Change (%) | 9M 2024 Revenue (in million) | 9M 2023 Revenue (in million) | Change (%) |
|---|---|---|---|---|---|---|
| Natural Gas | $234.1 | $247.0 | -5% | $715.3 | $913.9 | -22% |
| NGLs | $266.2 | $238.2 | +12% | $750.5 | $695.4 | +8% |
| Oil | $32.9 | $41.5 | -21% | $112.9 | $122.1 | -8% |
Revenue from derivative contracts for price stabilization
In Q3 2024, Range Resources recognized $47.1 million in derivative fair value income, up from $38.4 million in Q3 2023. For the first nine months of 2024, the derivative fair value income amounted to $110.5 million, a significant drop from $530.1 million in the same period of the previous year, reflecting the volatility in commodity prices.
| Period | Derivative Fair Value Income (in million) |
|---|---|
| Q3 2024 | $47.1 |
| Q3 2023 | $38.4 |
| 9M 2024 | $110.5 |
| 9M 2023 | $530.1 |
Income from brokered natural gas and marketing activities
For the third quarter of 2024, income from brokered natural gas and marketing activities was $34.6 million, compared to $44.6 million in Q3 2023. Over the first nine months of 2024, this income totaled $101.2 million, down from $171.6 million in the same period of 2023.
| Period | Brokered Natural Gas Income (in million) |
|---|---|
| Q3 2024 | $34.6 |
| Q3 2023 | $44.6 |
| 9M 2024 | $101.2 |
| 9M 2023 | $171.6 |
Potential revenue from joint ventures and partnerships
Range Resources continues to explore joint ventures and partnerships as potential revenue streams. While specific amounts are not disclosed in 2024 financial statements, the company has indicated that strategic partnerships in drilling and production could enhance operational efficiency and revenue generation in the long term. The focus remains on leveraging existing assets and capabilities to maximize returns.
Article updated on 8 Nov 2024
Resources:
- Range Resources Corporation (RRC) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Range Resources Corporation (RRC)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Range Resources Corporation (RRC)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.