Range Resources Corp. unveiled plans for 2020 on Jan. 6 to cut its capex for the year as the Texas-based shale producer switches gears from growing production to focusing on capital efficiency and reducing debt.

The move by Range to pull back spending and maintain production this year was viewed favorably by analysts. However, the positive news was offset by the company’s decision to suspend its roughly $20 million annual dividend.

Analysts with Tudor, Pickering, Holt & Co. (TPH) viewed going “ex-growth” as the right move for Range in the current gas macro environment but said continued execution of asset sales will remain key to the company’s success.

Since October 2018, Range has brought in more than $1 billion of proceeds through multiple asset sales. Divestitures have included several sell-downs of overriding royalty interests (ORRI) in its prized Marcellus Shale acreage plus additional properties elsewhere in the Appalachian Basin.

“Overall, we agree with the strategy given elevated leverage and remain focused on seeing continued execution on asset sales,” wrote TPH analysts in a Jan. 7 research note. The analysts noted divestiture targets include Southwest Pennsylvania ORRI, Northeast Pennsylvania and Louisiana Terryville Field assets.

For 2020, Range said it would maintain production at about 2.3 billion cubic feet equivalent per day (Bcfe/d) despite plans to lower its capital spending to about $520 million. Spending will be directed toward Range’s Marcellus assets, according to the company release.

As of Jan. 6, the company’s capex for 2019 is currently estimated to be $728 million—about $28 million less than originally budgeted, which Range CEO Jeff Ventura attributed to continued solid execution on its Marcellus program.

Additionally, the company also expects fourth-quarter 2019 production at the high end of its prior outlook of between 2.33 and 2.35 Bcfe/d.

“This is the second consecutive year the team has delivered our operational plans for less than originally budgeted, reflecting the organization’s continued focus on capital discipline and efficient operations,” Ventura said in a statement on Jan. 6.

According to its release, the capital underspend was driven primarily by continued improvement in Range’s drilling and completion efficiencies, water recycling program and service cost reductions. In particular, Ventura noted “peer-leading” well costs of less than $625 per foot, low base decline of about 20% and high productivity of core Marcellus assets in southwest Pennsylvania.

Going forward, Ventura said the decision to maintain production on a smaller budget will make Range one of the most capital-efficient natural gas producers in North America.

“As the industry exhausts its core inventory, we believe Range is well-positioned with a lengthy runway of high-quality drilling locations from which we can drive long-term value,” he said.