Chevron will acquire Atlas Energy for $3.2bn and net debt of about $1.1bn, providing Chevron with an attractive natural gas resource position in southwestern Pennsylvania’s Marcellus Shale.
Chevron will gain Atlas Energy’s estimated nine trillion cubic metres of natural gas, including about 254.8 billion cubic metres of proved natural gas reserves and about 2.2 million cubic feet of daily natural gas production.
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The assets in the Appalachian basin comprise 486,000 net acres of Marcellus Shale, 623,000 net acres of Utica Shale and a 49% interest in Laurel Mountain Midstream, a joint venture that owns over 1,000 miles of intrastate and natural gas gathering lines servicing the Marcellus.
Assets in Michigan include Antrim producing assets and 100,000 net acres of Collingwood/Utica Shale.
Chevron will also assume Atlas Energy’s role as operator with 60% participation in the Marcellus joint venture with Reliance, which will continue to fund 75% of the operator’s drilling costs of up to $1.4bn.
Chevron vice chairman George Kirkland said that they are acquiring a firm that has one of the premier acreage positions in the prolific Marcellus.
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By GlobalData”The high quality resource, competitive cost structure in the Marcellus, strong growth potential of the asset base and its proximity to premier natural gas markets make this targeted acquisition a compelling investment for Chevron,” Kirkland said.
