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Rice Energy Reports Fourth Quarter and Full Year 2013 Results; Provides Operational Update and 2014 Guidance

March 13, 2014

CANONSBURG, Pa., March 13, 2014 /PRNewswire/ — Rice Energy Inc. (NYSE: RICE) today announced financial and operational results for the quarter and year ended December 31, 2013 and provided an update on its 2014 activities and guidance.

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Unless otherwise indicated, information presented in this release gives pro forma effect to (i) our initial public offering and the completion of the corporate reorganization in connection with our initial public offering in January 2014 and (ii) the consummation of our acquisition of the remaining 50% interest in our Marcellus joint venture from Alpha Natural Resources, Inc.

Highlights

    --  Fourth quarter 2013 net production of 154 MMcf/d, representing a 120%
        increase relative to the fourth quarter of 2012 and a 20% sequential
        increase relative to the third quarter of 2013
    --  Full year 2013 production of 126 MMcf/d, representing a 166% increase
        relative to 2012 production
    --  Fourth quarter and full year 2013 Adjusted EBITDAX((1)) of $39.2 million
        and $107.8 million, respectively
    --  As of March 1, 2014, firm transportation portfolio covers approximately
        330,000 MMBtu/d in 2014, 654,000 MMBtu/d in 2015 and 761,000 MMBtu/d in
        2016
    --  Previously announced agreement to acquire gathering assets for $110
        million de-risks Marcellus takeaway plan and provides optionality for
        production acceleration
    --  Currently running two horizontal rigs in Marcellus Shale and one
        horizontal rig in Utica Shale with 40 gross operated wells
        (approximately 230,000 net horizontal feet) in various stages of
        development today
    --  Marcellus Shale leasehold position of 43,351 net acres and Utica Shale
        leasehold position of 46,488 net acres as of December 31, 2013

Commenting on the results, Daniel J. Rice IV, Chief Executive Officer, said, “2013 was a transformative year for Rice Energy. Over the course of the year we brought online 22 Marcellus wells totaling approximately 138,500 lateral feet with an average 60-day gross initial production rate of 11.0 MMcf/d and since year end we have turned online four additional Marcellus wells that averaged 11.8 MMcf/d per well for the initial 30 days. These results are a testament to the quality of our acreage and the proficiency of our shale-specific team.

“We measure our success, however, by our ability to make meaningful strides in the context of a long-term plan to maximize the value potential of our acreage positions in the cores of the Marcellus and Utica Shales. To that end, we believe we have further improved our positioning for long-term success with several key transactions. Our initial public offering in January 2014 was the second largest U.S. independent E&P IPO in history, providing us increased liquidity to pursue production growth and the ability to invest in strategic midstream and leasehold opportunities in order to support long-term value creation. Additionally, over the course of the last year we have selectively added to our robust portfolio of firm transportation contracts that now stands at 330,000 MMBtu/d, 654,000 MMBtu/d and 761,000 MMBtu/d of firm transportation in 2014, 2015 and 2016, respectively, supporting our ability to grow production and diversify our pricing exposure to Gulf Coast, Midwest and Northeast markets. Lastly, in February 2014, we bolstered the support for near-term production growth by entering into an agreement to acquire midstream assets in eastern Washington and Greene Counties. We believe that these transactions collectively will strengthen our near-term execution and drive long-term value creation for shareholders.”

2013 Results


                                                                           For the Three           For the Year
                                                                                                      Ended
                                                                           Months Ended            December 31,
                                                                                                       2013
                                                                            December 31,
                                                                                2013
                                                                           -------------

                                                                                       (Unaudited)

    Production data (MMcf/d) - 100% natural gas                                      154                          126

    Average prices before effects of hedges per Mcf                                        $3.90                      $3.89

    Average prices after effects of hedges per Mcf(1)                                      $4.25                      $4.01

    Average costs per Mcf:

    Lease operating                                                                        $0.33                      $0.36

    Gathering, compression and transportation                                              $0.52                      $0.55

    Production taxes and impact fees                                                       $0.08                      $0.06

    General and administrative                                                             $0.58                      $0.44

    Depletion, depreciation and amortization                                               $1.34                      $1.57

    Estimated proved reserves at December 31, 2013 - Natural gas (Bcf)(2):

    Total estimated proved reserves                                                                         602

    Total proved developed reserves                                                                         250

    Proved developed producing reserves                                                                     177

    Proved developed non-producing reserves                                                                  73

    Proved undeveloped reserves                                                                             352

    Percent developed reserves                                                                               42%

    PV-10 of proved reserves (in millions)(3)                                                                    $709


    (1)            The effect of hedges includes realized
                   gains and losses on commodity
                   derivative transactions.

    (2)            Our estimated pro forma proved reserves
                   and PV-10 were determined using a 12-
                   month average price for natural gas
                   consistent with requirements
                   established by the SEC. The prices
                   used in the reserve reports prepared
                   by our independent petroleum engineers
                   yield weighted average wellhead
                   prices, which are based on index
                   prices and adjusted for energy
                   content, transportation fees and
                   regional price differentials. The
                   index price and the equivalent
                   wellhead price as of December 31, 2013
                   were $3.67 per MMBtu and $3.90 per
                   Mcf, respectively.

    (3)            PV-10 is a non-GAAP financial measure
                   and generally differs from
                   standardized measure, the most
                   directly comparable GAAP financial
                   measure, because it does not include
                   the effects of income taxes on future
                   net revenues. Our pro forma
                   standardized measure was approximately
                       $443.7 million as of December 31,
                       2013. Neither PV-10 nor standardized
                   measure represents an estimate of the
                   fair market value of our natural gas
                   properties. We and others in the
                   industry use PV-10 as a measure to
                   compare the relative size and value of
                   proved reserves held by companies
                   without regard to the specific tax
                   characteristics of such entities.

Financial Results

Our production volumes were 14.2 Bcf for the quarter ended December 31, 2013, with natural gas price realizations, including the effect of hedges, of $4.25 per Mcf. For the quarter ended December 31, 2013, per unit cash production costs (lease operating; gathering, compression, and transportation; and production taxes and impact fees) were $0.93 per Mcf, depreciation, depletion and amortization expense was $19.0 million and loss on derivative instruments was $20.4 million. These factors contributed to a net loss of $8.7 million ($0.07 per diluted share) for the quarter ended December 31, 2013.

Our production volumes were 45.9 Bcf for the year ended December 31, 2013, with natural gas price realizations, including the effect of hedges, of $4.01 per Mcf. For the year ended December 31, 2013, per unit cash production costs were $0.97 per Mcf, depreciation, depletion and amortization expense was $71.9 million and restricted unit expense was $32.9 million. These factors contributed to a net loss of $16.5 million ($0.13 per diluted share) for the year ended December 31, 2013.

2013 and 2014 Operational Highlights

During the fourth quarter of 2013, we averaged 154 MMcf/d of net production, an increase of 120% over the prior year’s comparable quarter and 20% over the third quarter of 2013. The sequential period production growth was the result of three pads consisting of seven new Rice-operated Marcellus wells being turned into sales in the fourth quarter of 2013. The following table provides certain operational data as of March 1, 2014 related to the seven wells added in the fourth quarter of 2013.


                                       Aggregate Periodic Flow
                                           Rates (MMcf/d)

                                              0-90 Days
                                              ---------

     Wells per Average Lateral Length                                 D&C
                       (Feet)                                      ($/Foot)
        Pad
        ---

         3                       6,317                        34.6          $1,309

         1                       3,800                         8.5          $2,032

         3                       9,000                        47.2          $1,165

The following table provides certain operational data related to our proved developed producing Marcellus Shale wells as of December 31, 2013. We are the operator of each of these wells.


                                                          Periodic Flow Rates (MMcf/d) (1)
                                                          --------------------------------

         Year(s)    Wells        Average       Average                  0-90               91-180 181-360 361-720   D&C
                    Turned   Wells per Rig Lateral Length                                                         ($/Foot)
                                                                                                                      (2)
                  Into Sales      Move         (Feet)
    ---           ----------      ----          -----

        2010-2011          6           1.4          3,281                              5.5      6     4.4     2.9          $2,341

           2012            9             2          5,731                                9     10     6.8     N/A          $1,609

           2013           22           2.1          6,286                             11.1   10.3     9.2     N/A          $1,461
           ----          ---           ---          -----                             ----   ----     ---     ---          ------

          Total           37           1.9          5,664                              9.7    9.3     6.3     2.9          $1,640


    (1)              Based on production data through
                      March 1, 2014.

    (2)              D&C costs are shown gross of our
                      working interest's proportionate
                      share.

Financial Position and Liquidity

Pro forma for our initial public offering, we had $311.9 million of total debt, $347.0 million of cash and cash equivalents on hand, and $317.1 million available and zero drawn under our revolving credit facility.

First Quarter 2014 Operational and Hedging Update

Despite the severe weather experienced in Ohio and Pennsylvania during the first two months of 2014, we have been able to maintain high levels of producing well uptime. In addition, we brought online a four-well Marcellus pad (average lateral length of 6,691 feet) in Washington County, Pennsylvania. These wells are producing in line with management expectations, with a combined 30-day average gross production rate of 47.1 MMcf/d (average 11.8 MMcf/d per well) and a combined day 30 spot production rate of 53.8 MMcf/d (average 13.4 MMcf/d per well) on a restricted-choke program.

We maintain a natural gas hedging program and have continued to add to our derivative positions. Please see the “Derivatives Information” table at the end of this press release for more detailed information about our derivative position as of March 1, 2014.

2014 Capital Budget and Guidance

Our updated capital budget for 2014 is expected to be $1,230 million, consisting of the following:

    --  $430 million for drilling and completion in the Marcellus Shale;
    --  $150 million for drilling and completion in the Utica Shale;
    --  $385 million for leasehold acquisitions; and
    --  $265 million for midstream infrastructure development.

This represents a 96% increase over our $629 million 2013 capital budget. The 2014 updated capital budget excludes $100 million of cash paid with respect to the purchase of the remaining interests in our Marcellus joint venture and approximately $110 million expected to be paid for our previously-announced agreement to acquire midstream assets.

Of the $580 million 2014 drilling and completion budget, approximately 85% is related to Rice Energy-operated drilling and approximately 74% is allocated to the Marcellus Shale. Furthermore, approximately $200 million of the drilling and completion budget is for wells that Rice plans to begin producing in 2015. We anticipate running two horizontal rigs in the Marcellus Shale and one horizontal rig in the Utica Shale throughout 2014.

Assuming the execution of the $1,230 million capital plan discussed above, we anticipate that 2014 average net daily production will be between 260 MMcf/d and 310 MMcf/d (100% natural gas), representing a 106% to 146% increase over 2013 average net daily production. This increase is expected to be driven primarily by increasing development of our core Marcellus Shale acreage in southwestern Pennsylvania. Furthermore, in 2014, we anticipate that we will spud 43 net and initially produce 37 net horizontal Marcellus Shale wells, and that we will spud 13 net and initially produce 7 net horizontal Utica Shale wells. The production guidance presented above is based on the key assumptions in the table below.


                                            2014 Guidance
                                            -------------

                                     Low                  High
                                     ---                  ----

    Forecasted average daily
     production (MMcf/d)                 260                   310

    Forecasted natural gas as a
     percentage of production                      100%

    Heat content (Btu/Scf)                       1,050

    Average costs per Mcf:

    Lease operating                             $(0.40)            $(0.35)

    Gathering, compression and
     transportation                             $(0.55)            $(0.45)

    Production taxes and impact fees            $(0.03)            $(0.02)

    Cash general and administrative
     (in millions)                               $40.0              $35.0

Conference Call

Rice Energy will host a conference call on March 13, 2014 at 10 a.m. ET (9 a.m. CT) to discuss fourth quarter and full year 2013 earnings and operational results and to provide 2014 guidance. Interested parties are invited to participate on the call by dialing (888) 323-9686 (Conference ID: RICE ENERGY) at least 15 minutes prior to the start of the call. A replay of the call will be available on the Rice Energy website for a fourteen-day period following the call.

About Rice Energy

Rice Energy Inc. is an independent natural gas and oil company engaged in the acquisition, exploration and development of natural gas and oil properties in the Appalachian Basin. For more information, please visit our website at www.riceenergy.com.

Forward Looking Statements

This release includes “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”). Such forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control. All statements, other than historical facts included in this release, that address activities, events or developments that we expect or anticipate will or may occur in the future, including such things as our future capital expenditures (including the amount and nature thereof), business strategy and measures to implement strategy, competitive strengths, goals, expansion and growth of our business and operations, plans, market conditions, references to future success, references to intentions as to future matters and other such matters are forward-looking statements. All forward-looking statements speak only as of the date of this release. Although we believe that the plans, intentions and expectations reflected in or suggested by the forward-looking statements are reasonable, there is no assurance that these plans, intentions or expectations will be achieved. Therefore, actual outcomes and results could materially differ from what is expressed, implied or forecast in such statements.

We caution you that these forward-looking statements are subject to risks and uncertainties, most of which are difficult to predict and many of which are beyond our control, incident to the exploration for and development, production, gathering and sale of natural gas and oil. These risks include, but are not limited to: commodity price volatility; inflation; lack of availability of drilling and production equipment and services; environmental risks; drilling and other operating risks; regulatory changes; the uncertainty inherent in estimating natural gas reserves and in projecting future rates of production, cash flow and access to capital; and the timing of development expenditures. Information concerning these and other factors can be found in our filings with the Securities and Exchange Commission, including our Forms 10-K, 10-Q and 8-K. Consequently, all of the forward-looking statements made in this news release are qualified by these cautionary statements and there can be no assurances that the actual results or developments anticipated by us will be realized, or even if realized, that they will have the expected consequences to or effects on us, our business or operations. We have no intention, and disclaim any obligation, to update or revise any forward-looking statements, whether as a result of new information, future results or otherwise.


                                                                                              RICE ENERGY INC.

                                                                                            PRO FORMA CONDENSED

                                                                             CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 2013

                                                                                                (Unaudited)

    (in thousands)                                    Historical            Consolidation of              Reorganization                     Pro Forma
                                                   Rice Drilling B            Marcellus JV               and Offering Pro              Rice Energy Inc.
                                                                                Pro Forma                      Forma
                                                                               Adjustments                  Adjustments
                                                                                                                                                      ---

    Assets

    Current assets:

    Cash                                                            $31,612                                                 $(88,701)                      $630,000    $347,011

                                                                                                                  (35,500)

                                                                                                                 (190,400)

    Restricted cash                                          8,268                                    -                                       -               8,268

    Accounts receivable                                     31,765                               12,827                                       -              44,592

    Receivable from affiliate                                2,244                                   10                                       -               2,254

    Prepaid expenses and other                                 863                                   93                                       -                 956
                                                               ---                                  ---                                     ---                 ---

    Total current assets                                    74,752                              (75,771)                                404,100             403,081

    Investments in joint ventures                           49,814                              (49,760)                                      -                  54

    Gas collateral account                                   3,700                                  295                                       -               3,995

    Proved natural gas properties, net                     270,523                              320,000                                       -             590,523

    Unproved natural gas properties                        457,836                                    -                                       -             457,836

    Property and equipment, net                              5,972                                   83                                       -               6,055

    Deferred financing costs, net                           12,292                                  851                                       -              13,143

    Other non-current assets                                 4,921                              366,042                                       -             370,963
                                                             -----                              -------                                     ---             -------

    Total assets                                           879,810                              561,740                                 404,100           1,845,650
                                                           =======                              =======                                 =======           =========

    Liabilities and members'/stockholders' capital

    Current liabilities:

    Current portion of long-term debt                       20,120                                    -                                       -              20,120

    Accounts payable                                        51,219                               20,024                                       -              71,243

    Royalties payable                                        9,393                                6,831                                       -              16,224

    Accrued interest                                           250                                   16                                       -                 266

    Accrued capital expenditures                            16,753                                1,775                                       -              18,528

    Other accrued liabilities                                8,283                                2,048                                       -              10,331

    Leasehold payable                                       18,606                                   69                                       -              18,675

    Derivative liabilities                                     965                                2,427                                       -               3,392

    Payable to affiliate                                     6,148                                   11                                       -               6,159

    Operated prepayment liability                            1,201                                    -                                       -               1,201
                                                             -----                                  ---                                     ---               -----

    Total current liabilities                              132,938                               33,201                                       -             166,139

    Long-term liabilities:

    Long-term debt                                         406,822                               75,400                               (190,400)             291,822

    Leasehold payable                                        1,675                                   69                                       -               1,744

    Deferred tax liability                                       -                               57,118                                 (96,487)            (39,369)

    Restricted units                                        36,306                                    -                                       -              36,306

    Other long-term liabilities                              3,422                                  712                                       -               4,134
                                                             -----                                  ---                                     ---               -----

    Total liabilities                                      581,163                              166,500                               (286,887)             460,776
                                                           -------                              -------                                --------             -------

    Members'/stockholders' capital                         298,647                              395,240                                 690,987           1,384,874
                                                           -------                              -------                                 -------           ---------

    Total liabilities and
     members'/stockholders' capital                                $879,810                                                 $561,740                       $404,100  $1,845,650
                                                                   ========                                                 ========                       ========  ==========


                                                                                                     RICE ENERGY INC.

                                                                                 PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

                                                                                           THREE MONTHS ENDED DECEMBER 31, 2013

                                                                                                       (Unaudited)

            (in thousands, except per share
                         data)                 Historical              Consolidation of              Reorganization                 Pro Forma
                                            Rice Drilling B            Marcellus JV Pro             and Offering Pro            Rice Energy Inc.
                                                                             Forma                        Forma
                                                                          Adjustments                  Adjustments
                                                                                                                                             ---

    Revenues:

    Natural gas sales                                         $27,628                                                  $27,739                           $       -  $55,367

    Other revenue                                       238                                      -                                             -               238
                                                        ---                                    ---                                           ---               ---

    Total revenues                                   27,866                                 27,739                                             -            55,605

    Operating expenses:

    Lease operating                                   2,587                                  2,095                                             -             4,682

    Gathering, compression and
     transportation                                   2,751                                  4,619                                             -             7,370

    Production taxes and impact
     fees                                               600                                    596                                             -             1,196

    Exploration                                       8,167                                      -                                             -             8,167

    Restricted unit expense                          (7,181)                                     -                                             -            (7,181)

    General and administrative                        7,001                                  1,256                                             -             8,257

    Depreciation, depletion and
     amortization                                     9,600                                  9,450                                             -            19,050

    Loss on impairment of natural
     gas properties                                       -                                    146                                             -               146

    Loss from sale of interest in
     gas properties                                   4,230                                      -                                             -             4,230
                                                      -----                                    ---                                           ---             -----

    Total expenses                                   27,755                                 18,162                                             -            45,917
                                                     ------                                 ------                                           ---            ------

    Operating income                                    111                                  9,577                                             -             9,688

    Interest income (expense)                        (4,882)                                  (403)                                        1,523            (3,762)

    Other income (expense)                              (10)                                   106                                             -                96

    Loss on derivative instruments                   (9,807)                               (10,581)                                            -           (20,388)

    Amortization of deferred
     financing costs                                   (470)                                   (57)                                            -              (527)

    Equity in income (loss) of
     joint ventures                                     123                                    (30)                                            -                93
                                                        ---                                    ---                                           ---               ---

    Income (loss) before income
     taxes                                          (14,935)                                (1,388)                                        1,523           (14,800)

    Income tax benefit                                    -                                      -                                         6,140             6,140
                                                        ---                                    ---                                         -----             -----

    Net income (loss)                                        $(14,935)                                                 $(1,388)                             $7,663  $(8,660)
                                                             ========                                                  =======                              ======  =======

    Earnings per share-basic                                                                                                                     $(0.07)

    Earnings per share-diluted                                                                                                                   $(0.07)


                                                                                             RICE ENERGY INC.

                                                                         PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

                                                                                       YEAR ENDED DECEMBER 31, 2013

                                                                                               (Unaudited)

    (in thousands, except per share
     data)                             Historical              Consolidation of              Reorganization                 Pro Forma
                                    Rice Drilling B            Marcellus JV Pro             and Offering Pro            Rice Energy Inc.
                                                                     Forma                        Forma
                                                                  Adjustments                  Adjustments
                                                                                                                                     ---

    Revenues:

    Natural gas sales                                 $87,847                                                  $90,677                           $       -  $178,524

    Other revenue                               757                                      -                                             -               757
                                                ---                                    ---                                           ---               ---

    Total revenues                           88,604                                 90,677                                             -           179,281

    Operating expenses:

    Lease operating                           8,309                                  8,193                                             -            16,502

    Gathering, compression and
     transportation                           9,774                                 15,663                                             -            25,437

    Production taxes and impact
     fees                                     1,629                                  1,258                                             -             2,887

    Exploration                               9,951                                      -                                             -             9,951

    Restricted unit expense                  32,906                                      -                                             -            32,906

    General and administrative               16,953                                  3,256                                             -            20,209

    Depreciation, depletion and
     amortization                            32,815                                 39,071                                             -            71,886

    Loss on impairment of natural
     gas properties                               -                                    146                                             -               146

    Loss from sale of interest in
     gas properties                           4,230                                      -                                             -             4,230
                                              -----                                    ---                                           ---             -----

    Total expenses                          116,567                                 67,587                                             -           184,154
                                            -------                                 ------                                           ---           -------

    Operating income (loss)                 (27,963)                                23,090                                             -            (4,873)

    Interest income (expense)               (17,915)                                  (880)                                        2,373           (16,422)

    Other expense                              (357)                                  (796)                                            -            (1,153)

    Gain on derivative instruments            6,891                                  3,347                                             -            10,238

    Amortization of deferred
     financing costs                         (5,230)                                  (164)                                            -            (5,394)

    Loss on extinguishment of debt          (10,622)                                     -                                             -           (10,622)

    Equity in income (loss) of
     joint ventures                          19,420                                (19,330)                                            -                90
                                             ------                                -------                                           ---               ---

    Income (loss) before income
     taxes                                  (35,776)                                 5,267                                         2,373           (28,136)

    Income tax benefit                            -                                      -                                        11,674            11,674
                                                ---                                    ---                                        ------            ------

    Net income (loss)                                $(35,776)                                                  $5,267                             $14,047  $(16,462)
                                                     ========                                                   ======                             =======  ========

    Earnings per share-basic                                                                                                             $(0.13)

    Earnings per share-diluted                                                                                                           $(0.13)


                             RICE DRILLING B LLC AND SUBSIDIARIES

                                  CONSOLIDATED BALANCE SHEETS

                                                     December 31,
                                                     ------------

    (in thousands)                          2013                     2012
                                            ----                     ----

    Assets

    Current assets:

    Cash                                            $31,612                 $8,547

    Restricted cash                        8,268                        -

    Accounts receivable                   31,765                    8,557

    Receivable from
     affiliate                             2,244                   11,879

    Prepaid expenses and
     other                                   863                      321
                                             ---

    Total current assets                  74,752                   29,304

    Investments in joint
     ventures                             49,814                   30,976

    Gas collateral account                 3,700                    5,843

    Proved natural gas
     properties, net                     270,523                  159,988

    Unproved natural gas
     properties                          457,836                  111,030

    Property and equipment,
     net                                   5,972                    2,622

    Deferred financing
     costs, net                           12,292                    5,208

    Other non-current assets               4,921                        -
                                           -----                      ---

    Total assets                                   $879,810               $344,971
                                                   ========               ========

    Liabilities and members'
     capital

    Current liabilities:

    Current portion of long-
     term debt                                      $20,120                 $8,814

    Accounts payable                      51,219                   19,793

    Royalties payable                      9,393                    1,960

    Accrued interest                         250                    2,004

    Accrued capital
     expenditures                         16,753                    2,359

    Other accrued
     liabilities                           8,283                    5,585

    Leasehold payable                     18,606                    3,954

    Derivative liabilities                   965                    2,260

    Payable to affiliate                   6,148                    2,482

    Operated prepayment
     liability                             1,201                   11,553
                                           -----                   ------

    Total current
     liabilities                         132,938                   60,764

    Long-term liabilities:

    Long-term debt                       406,822                  140,506

    Leasehold payable                      1,675                      106

    Restricted units                      36,306                    3,400

    Other long-term
     liabilities                           3,422                    2,004
                                           -----                    -----

    Total liabilities                    581,163                  206,780

    Members' capital                     298,647                  138,191
                                         -------                  -------

    Total liabilities and
     members' capital                              $879,810               $344,971
                                                   ========               ========


                               ALPHA SHALE RESOURCES, LP

                                    BALANCE SHEETS

                                                 December 31,
                                                 ------------

    (in thousands)                      2013                     2012
                                        ----                     ----

    Assets

    Current assets:

    Cash                                        $11,299                 $4,445

    Accounts receivable               14,842                    5,716

    Receivable from affiliate             10                        1

    Prepaid expenses and other            93                      108
                                         ---                      ---

    Total current assets              26,244                   10,270

    Gas collateral account               295                      295

    Proved natural gas
     properties, net                 182,333                  114,128

    Property and other
     equipment, net                       83                       91

    Deferred financing costs,
     net                                 851                      387

    Other non-current assets           1,010                        -
                                       -----                      ---

    Total assets                               $210,816               $125,171
                                               ========               ========

    Liabilities and partners'
     capital

    Current liabilities:

    Accounts payable                            $20,024                $18,953

    Royalties payable                  6,831                    2,082

    Accrued interest                      16                      413

    Accrued capital
     expenditures                      1,775                    3,489

    Other accrued liabilities          2,048                      726

    Leasehold payable                     69                      331

    Derivative liabilities             2,427                      138

    Payable to affiliate               2,026                    8,538
                                       -----                    -----

    Total current liabilities         35,216                   34,670

    Long-term liabilities:

    Long-term debt                    75,400                   29,200

    Leasehold payable                     69                        -

    Other long-term
     liabilities                         712                      542
                                         ---                      ---

    Total liabilities                111,397                   64,412

    Partners' capital                 99,419                   60,759
                                      ------                   ------

    Total liabilities and
     partners' capital                         $210,816               $125,171
                                               ========               ========


                                                                       RICE DRILLING B LLC AND SUBSIDIARIES

                                                                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                      Three Months Ended December 31,                        Year Ended December 31,
                                      -------------------------------                        -----------------------

    (in thousands)                        2013                  2012                  2013                 2012
                                          ----                  ----                  ----                 ----

    Revenues:                                 (Unaudited)

    Natural gas sales                             $27,628                                    $11,216                  $87,847   $26,743

    Other revenue                          238                             457                              757           457
                                           ---                             ---                              ---           ---

    Total revenues                      27,866                          11,673                           88,604        27,200

    Operating expenses:

    Lease operating                      2,587                           1,462                            8,309         3,688

    Gathering, compression and
     transportation                      2,751                           1,341                            9,774         3,754

    Production taxes and impact fees       600                             217                            1,629         1,382

    Exploration                          8,167                             425                            9,951         3,275

    Restricted unit expense             (7,181)                              -                           32,906             -

    General and administrative           7,001                           2,225                           16,953         7,599

    Depreciation, depletion and
     amortization                        9,600                           3,940                           32,815        14,149

    Write-down of abandoned leases           -                              30                                -         2,253

    Loss from sale of interest in gas
     properties                          4,230                               -                            4,230             -
                                         -----                             ---                            -----           ---

    Total operating expenses            27,755                           9,640                          116,567        36,100
                                        ------                           -----                          -------        ------

    Operating income (loss)                111                           2,033                          (27,963)       (8,900)
                                           ---                           -----                          -------        ------

    Other income (expense):

    Interest expense                    (4,882)                         (1,686)                         (17,915)       (3,487)

    Other income (expense)                 (10)                             36                             (357)          112

    Gain (loss) on derivative
     instruments                        (9,807)                          2,026                            6,891        (1,381)

    Amortization of deferred
     financing costs                      (470)                         (1,680)                          (5,230)       (7,220)

    Loss on extinguishment of debt           -                               -                          (10,622)            -

    Equity in income of joint
     ventures                              123                           1,668                           19,420         1,532
                                           ---                           -----                           ------         -----

    Total other income (expense)       (15,046)                            364                           (7,813)      (10,444)
                                       -------                             ---                           ------       -------

    Net income (loss)                            $(14,935)                                    $2,397                 $(35,776) $(19,344)
                                                 ========                                     ======                 ========  ========


                                                                      ALPHA SHALE RESOURCES, LP

                                                                      STATEMENTS OF OPERATIONS

                                  Three Months Ended December 31,               Year Ended December 31,
                                  -------------------------------               -----------------------

    (in thousands)                     2013                 2012               2013                 2012
                                       ----                 ----               ----                 ----

    Revenue:                              (Unaudited)

    Natural gas sales                         $27,739                                 $11,828             $90,677  $26,284

    Operating expenses:

    Depreciation, depletion and
     amortization                     8,031                       2,322                           25,008    9,411

    Gathering, compression and
     transportation                   4,619                       3,295                           15,663    6,671

    Lease operating                   2,095                       1,841                            8,193    3,331

    Production taxes and impact
     fees                               596                         141                            1,258      869

    Loss on impairment of natural
     gas properties                     146                           -                              146        -

    General and administrative
     expenses                         1,256                         721                            3,256    2,058
                                      -----                         ---                            -----    -----

    Total operating expenses         16,743                       8,320                           53,524   22,340
                                     ------                       -----                           ------   ------

    Operating income                 10,996                       3,508                           37,153    3,944
                                     ------                       -----                           ------    -----

    Other income (expense):

    Other income (expense)              106                          (4)                            (796)       -

    Gain (loss) on derivative
     instruments                    (10,581)                        (74)                           3,347      (74)

    Amortization of deferred
     financing costs                    (57)                        (15)                            (164)     (15)

    Interest expense                   (403)                       (101)                            (880)    (372)
                                       ----                        ----                             ----     ----

    Total other income (expense)    (10,935)                       (194)                           1,507     (461)
                                    -------                        ----                            -----     ----

    Net income                                    $61                                  $3,314             $38,660   $3,483
                                                  ===                                  ======             =======   ======


                                       RICE DRILLING B LLC AND SUBSIDIARIES

                                       CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                            Year Ended December 31,
                                                            -----------------------

    (in thousands)                                     2013                  2012
                                                       ----                  ----

    Cash flows from operating
     activities:

    Net loss                                                  $(35,776)                       $(19,344)

    Adjustments to reconcile net loss
     to net cash provided by (used in)
     operating activities:

    Depreciation, depletion and
     amortization                                    32,815                           14,149

    Amortization of deferred financing
     costs                                            5,230                            7,220

    Loss from sale of interest in gas
     properties                                       4,230                                -

    Restricted unit expense                          32,906                                -

    Write-off of unsuccessful
     exploratory well costs                           8,143                                -

    Derivative instruments fair value
     (gain) loss                                     (6,891)                           1,381

    Equity in income of joint ventures              (19,420)                          (1,532)

    Write-down of abandoned leases and
     other leasehold costs                                -                            2,253

    (Increase) decrease in:

    Accounts receivable                             (17,208)                          (3,828)

    Receivable from affiliate                         9,635                           (8,403)

    Gas collateral account                              643                           (4,137)

    Prepaid expenses and other                         (541)                            (212)

    Cash receipts for settled
     derivatives                                        676                              879

    Increase (decrease) in:

    Accounts payable                                  2,273                              (30)

    Royalties payable                                 7,432                              775

    Other accrued expenses                            5,859                            7,391

    Payable to affiliate                              3,666                              424
                                                      -----

    Net cash provided by (used in)
     operating activities                            33,672                           (3,014)
                                                     ------                           ------

    Cash flows from investing
     activities:

    Capital expenditures for natural
     gas properties                                (463,128)                       (109,149)

    Investment in joint ventures                          -                           (9,957)

    Capital expenditures for property
     and equipment                                   (2,259)                            (867)

    Proceeds from sale of interest in
     gas properties                                   6,792                                -
                                                      -----                              ---

    Net cash used in investing
     activities                                    (458,595)                       (119,973)
                                                   --------                         --------

    Cash flows from financing
     activities:

    Proceeds from borrowings                        435,500                           44,361

    Repayments of debt obligations                 (160,760)                         (10,152)

    Restricted cash for convertible
     debt                                            (8,268)                               -

    Debt issuance costs                             (12,194)                          (1,913)

    Capital contributions                           195,977                           96,782

    Repurchase of restricted units                   (2,267)                          (1,133)

    Return of capital                                     -                             (800)
                                                        ---                             ----

    Net cash provided by financing
     activities                                     447,988                          127,145
                                                    -------                          -------

    Net increase in cash                             23,065                            4,158

    Cash at the beginning of the year                 8,547                            4,389
                                                      -----                            -----

    Cash at the end of the year                                $31,612                          $8,547
                                                               =======                          ======


                                                    ALPHA SHALE RESOURCES, LP

                                                    STATEMENTS OF CASH FLOWS

                                                                     Year Ended December 31,
                                                                     -----------------------

    (in thousands)                                                    2013                 2012
                                                                      ----                 ----

    Cash flows from operating activities:

    Net income                                                               $38,660                     $3,483

    Adjustments to reconcile net income to net cash
     provided by operating activities:

    Depreciation, depletion and amortization                        25,008                        9,411

    Amortization of deferred financing costs                           164                           15

    Loss on impairment of natural gas properties                       146                            -

    Derivative instruments fair value (gain) loss                   (3,347)                          74

    (Increase) decrease in:

    Accounts receivable                                             (9,126)                      (5,067)

    Receivable from affiliate                                            -                           25

    Gas collateral account                                               -                         (295)

    Prepaid expenses and other                                          15                           55

    Cash receipts for settled derivatives                            4,627                           64

    Increase (decrease) in:

    Accounts payable                                                    69                          347

    Royalties payable                                                4,749                        1,734

    Other accrued expenses                                             928                        1,050

    Payable to affiliate                                            (6,512)                       2,499
                                                                    ------                        -----

    Net cash provided by operating activities                       55,381                       13,395

    Cash flows from investing activities:

    Capital expenditures for natural gas properties                (94,099)                     (63,847)

    Capital expenditures for property and other
     equipment                                                           -                          (12)
                                                                       ---                          ---

    Net cash used in investing activities                          (94,099)                     (63,859)

    Cash flows from financing activities:

    Proceeds from borrowings                                        46,200                       29,200

    Debt issuance costs                                               (628)                        (402)

    Capital contributions                                                -                       20,000
                                                                       ---                       ------

    Net cash provided by financing activities                       45,572                       48,798

    Net increase (decrease) in cash                                  6,854                       (1,666)

    Cash at the beginning of the year                                4,445                        6,111
                                                                     -----                        -----

    Cash at the end of the year                                              $11,299                     $4,445
                                                                             =======                     ======

Rice Energy Inc.

Supplemental Non-GAAP Financial Measure

(Unaudited)

Adjusted EBITDAX is a supplemental non-GAAP financial measure that is used by management and external users of our consolidated financial statements, such as industry analysts, investors, lenders and rating agencies. We define Adjusted EBITDAX as net income (loss) before interest expense or interest income; income taxes; write-down of abandoned leases; depreciation, depletion and amortization; amortization of deferred financing costs; equity in (income) loss of our joint ventures; derivative fair value (gain) loss, excluding net cash receipts on settled derivative instruments; non-cash compensation expense; (gain) loss from sale of interest in gas properties; and exploration expenses. Adjusted EBITDAX is not a measure of net income as determined by United States generally accepted accounting principles, or GAAP.

The following table presents a pro forma reconciliation of the non-GAAP financial measure of Adjusted EBITDAX to the GAAP financial measure of net income (loss).





                     Three Months
                         Ended                  Year Ended

    (in              December 31,
     thousands)           2013              December 31, 2013
                    -------------           -----------------

    Adjusted
     EBITDAX
     reconciliation
     to net
     income
     (loss):

    Net loss                       $(8,660)                            $(16,462)

    Interest
     expense                3,762                              16,422

     Depreciation,
     depletion
     and
     amortization          19,050                              71,886

     Amortization
     of
     deferred
     financing
     costs                    526                               5,394

    Equity
     in
     income
     of
     joint
     ventures                 (93)                                (90)

     Derivative
     fair
     value
     (gain)
     loss
     (1)                   20,388                             (10,238)

    Net cash
     receipts
     on
     settled
     derivative
     instruments
     (1)                    4,966                               5,302

     Restricted
     unit
     expense               (7,181)                             32,906

    Income
     tax
     benefit               (6,140)                            (11,674)

    Loss
     from
     sale of
     interest
     in gas
     properties             4,230                               4,230

    Loss on
     impairment
     of
     natural
     gas
     properties               146                                 146

     Exploration
     expenses               8,167                               9,951
                            -----                               -----

    Adjusted
     EBITDAX                       $39,161                             $107,773
                                   =======                             ========

    (1)            The adjustments for the
                    derivative fair value (gains)
                    losses and net cash receipts
                    on settled commodity
                    derivative instruments have
                    the effect of adjusting net
                    income (loss) for changes in
                    the fair value of derivative
                    instruments, which are
                    recognized at the end of each
                    accounting period because we
                    do not designate commodity
                    derivative instruments as
                    accounting hedges. This
                    results in reflecting
                    commodity derivative gains and
                    losses within Adjusted EBITDAX
                    on a cash basis during the
                    period the derivatives
                    settled.


                                                                     Rice Energy Inc.

                                                                 Derivatives Information

                                                                       (Unaudited)

                        The table below provides data associated with our derivatives at March 1, 2014 for the periods indicated:

                                             2014             2015                      2016                       2017
                                             ----             ----                      ----                       ----

    Natural Gas Swaps: (1)

    Volume
     (BBtu/d)                                 162               92                        99                         60

    Price
     ($/MMBtu)                                      $4.12                              $4.16                              $4.20         $4.24

    Natural Gas Collars: (1)

    Volume
     (BBtu/d)                                  10               70                         -                          -

    Ceiling
     Price
     ($/MMBtu)                                      $5.80                              $4.68                        n/a           n/a

    Floor Price
     ($/MMBtu)                                      $3.00                              $3.91                        n/a           n/a

    Natural Gas Puts: (1)

    Volume
     (BBtu/d)                                  23                -                         -                          -

    Strike Price
     ($/MMBtu)                                      $4.55                          $       -                          $       -       $     -

    Put Premium
     ($/MMBtu)                                      $0.45                          $       -                          $       -       $     -


    (1)            The index prices for
                   the natural gas price
                   swaps, collars and
                   puts are based on the
                   NYMEX - Henry Hub
                   last trading day
                   futures price.

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SOURCE Rice Energy Inc.


Source: PR Newswire



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