Total has acquired a 25% share in Chesapeake’s and EnerVest’s liquids-rich area of the Utica shale play located across 10 counties on the eastern side of the state of Ohio, USA.
Yves-Louis Darricarrère, President, Total Exploration & Production, said, “This joint venture will provide us with a material position in a valuable long-term resource base under attractive terms and with a top-class operator. Total is conscious of the environmental aspects linked to developing shale acreage and is confident in Chesapeake’s capacity to manage the Utica shale operations in a responsible manner, respecting the highest industry standards. ”
Total has paid Chesapeake and EnerVest approximately US$ 700 million in cash for acquiring these assets. Total will also pay additional amounts up to US$ 1.63 billion over a maximum period of 7 years.
The Joint Venture covers approximately 619,000 net acres, of which 542,000 net acres are brought by Chesapeake and 77,000 net acres are brought by EnerVest. Total will acquire its 25% share from each of Chesapeake and EnerVest on identical terms, giving a total of 155,000 net acres. Chesapeake will operate the Joint Venture acreage.
Total will also acquire a 25% share in any new acreage which will be acquired by Chesapeake in the liquids-rich area of the Utica shale play.
To date 13 wells have been drilled across the acreage with very promising results seen from each well in terms of productivity and liquid content. The Joint Venture plans to ramp up the drilling activities in the coming 3 years with 25 rigs planned to be mobilized by 2014 to fully appraise and develop the acreage. SEC production in Total’s share is expected to reach 100,000 bpd of oil equivalent by the end of the decade.
Additionally, Total, Chesapeake and EnerVest have agreed to jointly develop the construction of the necessary midstream facilities to export the production from this acreage.
Read the article online at: https://www.worldpipelines.com/business-news/03012012/total_acquires_acreage_in_utica_shale/