Marcellus Shale News Pulse May 2021

Posted: June 15, 2021

The Marcellus Shale| May 2021

Field Overview

The Marcellus Shale is the largest gas play onshore in the US. Located in the Northeast, it supplies the high demand markets along the East Coast. Most of the basin’s gas is produced through unconventional methods, while the little oil produced is mostly by conventional means. Some of the top formations include Onondaga and the Huntersville.

State Drilling Statistics (End of May)

Active Drilling Rigs in Basin- 30
Total Rigs in Pennsylvania- 17
Total Rigs in United States- 457
Total U.S. Rigs up 52% YTD

State Permitting Data (End of May)
Permits Approved (PA) – 59

Marcellus Top Producers
Top Producer By BOE – Chesapeake


Basin Highlights

EQT Buys Marcellus Assets of Alta Resources for $2.9 Billion

EQT is purchasing 300,000 net acres in the core northeastern Marcellus which is producing 1 billion cubic feet per day of dry gas. This also includes integrated pipeline assets. EQT financed its purchase with $1 billion of cash on hand along with 105 million shares of common stock worth nearly $2 billion. This deal is another big win for Alta’s veteran CEO Joseph Greenberg. After founding the Houston based company in 1999, he invested into new shale discoveries. In 2008, he sold all of his Arkansas shale acreage to Petrohawk and XTO Energy for $550 million. In the Marcellus, Alta sold early acreage to WPX in 2010 for half a billion. This deal will expand EQT beyond its core southwest Marcellus footprint. Still, EQT has some $5 billion in debt, but Alta’s incredibly low lifting and transportation costs should generate some additional free cash flow for EQT.

Article Link

Cimarex to Merge with Cabot Oil and Gas

While more and more companies continue to consolidate into pure play portfolios, Cimarex and Cabot have come out of left field with an unlikely merger. The deal results in a company with an enterprise value of $17 billion and a portfolio of assets split between Cimarex’s core 56,000 acre position in the Permian and Cabot’s core 173,000 acres in the Marcellus. Cimarex shareholders take a slightly larger 50.5% of company stake, but both companies will bring 4 members to the new board. Both companies were ripe for acquisition as EQT was eyeing both Cabot and their recently acquired Alta Resources. Cimarex has been seen as a favorite by many major Permian players like Pioneer, but it seems that rather than being acquired, both companies agreed it was in their best interest to combine despite their zero overlap. Perhaps it was a result of further consolidation of the Marcellus to the growing portfolio of EQT. Tom Jorden, current CEO of Cimarex will remain as the CEO of both companies.

Article Link


Operators with Most Permits in PA (March)

RankCompanyPermits
Approved
1Chief Oil and Gas7
1Cabot7
3Snyder Bros6
3Chesapeake6
5Cameron Energy5
Hyperlinks to available Q1 2021 Reports

Top Producers By BOE (2021 cum)

RankCompany
1Chesapeake
2Cabot
3Range
4EQT
5Rice Drilling
Hyperlinks to available Q1 2021 Reports

Rig Count


PA Oil Production


PA Natural Gas Production


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The information contained in this newsletter is provided by RARE
PETRO Engineering, PLLC via the following sources unless otherwise
noted:

www.eia.gov
www.drillinginfo.com
www.bhge.com
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