Utica Shale

Magnum Hunter Resources Adds To Utica Shale Position

Magnum Hunter Resources (MHR) reported the purchase of additional leasehold in Ohio that is prospective for the Utica Shale formation.

Magnum Hunter Resources purchased approximately 15,558 gross or 12,186 net acres for $24.8 million, or a net price of $2,037 per acre.  The acreage is located in Noble County, Ohio.

Magnum Hunter Resources said that the majority of the acreage was held by production from shallower formations.

Magnum Hunter Resources said that the acquired acreage is close to the company’s existing position in Washington and Noble Counties, and brings its total position prospective for the Utica Shale to 23,214 gross or 17,316 net acres.

Carrizo Oil and Gas Enters Utica Shale Joint Venture

Carrizo Oil and Gas (CRZO) formed a joint venture with Avista Capital Partners to purchase and develop leasehold that is prospective for the Utica Shale.  The venture is primarily looking for leasehold in the liquids portion of the play and recently closed on the acquisition of 15,000 net acres in Ohio and Pennsylvania at an average cost of $1,500 per acre.

Carrizo Oil and Gas will own an initial 10% interest in the joint venture but holds two purchase options to increase its interest to 50% over the next eighteen months. Carrizo Oil and Gas will also be the operator of the joint venture.

CONSOL Energy and Hess Enter Utica Shale Joint Venture

CONSOL Energy (CNX) signed an agreement with Hess Corporation (HES) to conduct the joint exploration and development of the company’s leasehold in Ohio that is prospective for the Utica Shale.

Hess Corporation is paying a total of $593 million for a 50% share of approximately 200,000 Utica Shale acres.  The company will pay $59 million at closing and then pay an additional $534 million through a drilling carry on the leasehold.  The price is approximately $6,000 per acre.

CONSOL Energy and Hess Corporation expect to begin development in September 2011 and will average two rigs in 2012, 3.5 rigs in 2013 and five rigs by 2015.