Antero Resources has signed an agreement to acquire about 55,000 net acres in the core of the Marcellus Shale in West Virginia, US, from Southwestern Energy for $450m.
As part of the deal, Antero will acquire undeveloped properties that are located primarily in Wetzel, Tyler and Doddridge Counties, in addition to about 14 MMcfe/d of net production.
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Antero Resources chairman and CEO Paul Rady said: "The transaction creates a new platform for development and consolidation in Wetzel County, with attractive rich and dry gas Marcellus locations, as well as stacked pay potential for the dry Utica.
"Similar to the successful strategy that we deployed in Tyler County, we expect to further consolidate acreage in Wetzel County and build out the necessary midstream infrastructure to move our gas to market, creating significant value for both Antero Resources and Antero Midstream."
Antero’s acquisition will also include deep rights on about 41,000 net acres prospective for the underlying dry Utica.
Of the acquired land, 75% is located in Antero’s gas / condensate regimes, while the remaining 25% is located in the dry gas regime.
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By GlobalDataThe acquisition is set to add 625 identified 3P locations and will improve 435 existing 3P locations by incremental working interests.
Antero Resources president and CFO Glen Warren said: "Due to the savings achieved year-to-date from service cost reductions and operating efficiencies, we expect to add an additional rig in the second half of the year while maintaining our original drilling and completion budget of $1.3bn.
"The additional rig will focus primarily on Tyler County and enables Antero to accelerate production so we believe we can generate 20% to 25% year-over-year growth in 2017, with a minimal increase to the 2017 drilling and completion capital budget compared to 2016."
The company will dedicate more than 95% of the acquired acreage to Antero Midstream for gathering, compression, processing, and water services.
Antero Resources formed the Antero Midstream partnership to own, operate and develop midstream energy assets to service the company’s increasing production.
The transaction is subject to customary closing conditions and is expected to close in the third quarter of this year.
