PDC Energy (PETD) announced the acquisition of leasehold in Ohio that is prospective for the Utica Shale. The acreage is in the wet gas or liquids portion of the play.
PDC Energy is paying $50 million for 30,000 net acres located mostly in Noble, Monroe, Washington, Morgan and Guernsey counties. The company said that 75% of the acreage is held by production from shallower wells.
PDC Energy plans to drill a vertical test well in the fourth quarter of 2011, followed by two horizontal wells into the Utica Shale in 2012. The company has an option to drill two additional vertical wells in 2012.
PDC Energy will pay $10 million in 2011 and the balance in 2012 upon title confirmation. The company will fund the purchase with its credit facility. The company is looking for additional opportunities and plans to increase its Utica Shale leasehold to between 80,000 and 100,000 net acres by the end of 2012.
PDC Energy is also looking for a joint venture partner to share the risk and cost of developing the Utica Shale leasehold.