Acquisition includes drilling rights on an undeveloped 53,000 net acres for the deep Utica
PITTSBURGH – EQT Corporation today announced that it has signed a definitive agreement to acquire 62,500 net acres, and current natural gas production of 50 MMcfe per day from Statoil USA Onshore Properties, Inc. (Statoil), $407 million, subject to customary closing conditions.
The transaction is expected to close on or about July 8.
Primarily located in Wetzel, Tyler, and Harrison Counties of West Virginia, the acquisition adds a sizeable amount of acreage within EQT’s core development area and complements the company’s adjacent operations in Wetzel County, West Virginia.
The 62,500 acre acquisition includes existing Marcellus production and approximately 500 undeveloped locations that are expected to have an average lateral length of 5,600 feet.
Much of this acreage is contiguous with EQT’s existing development area; therefore, the lateral length of 106 existing EQT locations can now be extended from 3,000 to 6,500 feet, which will reduce overall costs and deliver stronger well economics, the company said in a press release.
In line with the company’s consolidation strategy, this acquisition increases EQT’s core undeveloped Marcellus acreage by 29 per cent.
The acquisition also includes drilling rights on an estimated 53,000 net acres that are undeveloped and prospective for the deep Utica.
Assets include 31 Marcellus wells, 24 of which are currently producing – three complete, not online and four drilled, not complete.
The resource potential of the acreage is estimated at 9.2 Tcf; and 87 per cent of the acreage is either held by production or has lease expiration terms that extend beyond 2018.
The acreage has an 84 per cent net revenue interest.