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Ohio Utica Shale

Antero Resources to focus on Utica, Marcellus shales

By Bob Downing Published: November 5, 2012

From the Marcellus Drilling News:

Antero Resources announced today they are selling off 61,000 acres of leases and 30 miles of pipeline, along with other assets, in the Piceance Basin (pronounced “pee awns”, located in northwestern Colorado) for $325 million in cash to an unnamed private company.

The fact Antero is selling assets elsewhere would not normally be news for MDN—except this time. Why? The reason they’re selling it is to invest the money in more drilling in the Marcellus and Utica Shale. With the sale of the Piceance, and earlier this year the sale of their Arkoma Basin assets, Antero is now totally focused on the Appalachian (Marcellus/Utica) basin.


Here’s the Antero press release announcing the Piceance deal:

Antero Resources announced today that it has entered into an agreement to sell all of its natural gas and pipeline assets in the Piceance Basin to a private company for $325 million in cash plus the assumption of all of Antero’s Rocky Mountain firm transportation obligations. The transaction is expected to close, subject to the satisfaction of customary closing conditions, in December 2012 with an effective date of October 1, 2012.

The transaction does not include Antero’s 78 Bcf of CIG index (Rockies) natural gas hedges through 2016 that have a cash value of approximately $100 million. Firm transportation obligations through 2021 were included in the transaction that have an undiscounted liability of $91 million, based on the difference between the pricing upgrade that can be obtained in the futures market at the tailgate of the pipelines and the fixed fee pipeline tariffs. Assuming the current monetization of Antero’s Rockies natural gas hedges by Antero, the total Piceance proceeds will include $325 million in cash from the purchaser for the upstream and pipeline assets before customary post-closing adjustments, the assumption by the purchaser of $91 million in undiscounted future firm transportation obligations and approximately $100 million in cash for the monetization of Antero’s Rockies hedges. The transaction and hedge proceeds will initially be used to repay bank debt and no taxes are expected to be paid.

The assets consist of 61,000 net acres of leasehold and 30 miles of gathering pipeline in the Piceance Basin located in western Colorado. The assets contain an estimated 205 Bcfe of proved developed reserves as of September 30, 2012 and are currently producing 59 MMcfed net from 284 gross operated wells.

Pro forma for the closing of the Piceance transaction, Antero’s estimated 1.0 Tcfe of total net proved developed reserves as of September 30, 2012 would be reduced to approximately 800 Bcfe. Antero’s September 30, 2012 proved developed reserves were internally generated by Antero’s reserve engineers using SEC pricing as of September 30, 2012 and have not been audited by Antero’s third party reserve engineers. Additionally, Antero’s $1.4 billion of net debt as of September 30, 2012 would be reduced to approximately $955 million, pro forma for the closing of the transaction and assuming the full monetization of the Piceance hedges. Upon closing, Antero expects the borrowing base under its credit facility to be reduced to $1.35 billion from $1.65 billion currently. The Company plans to maintain its lender commitments at $950 million.

Antero Resources Chairman and CEO Paul M. Rady commented, “The Piceance asset sale allows Antero to redeploy capital and human resources to its Marcellus and Utica Shale projects where we are focused on the development of liquids-rich natural gas and oil reserves. With the closing of the Piceance transaction, and our Arkoma Basin exit earlier in 2012, Antero will complete its transformation into a pure-play Appalachian Basin shale producer with a large scale, low cost, liquids-rich drilling inventory.”*

*Antero Resources (Nov 5, 2012) – Antero Resources Agrees to Sell its Piceance Basin Assets



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Utica and Marcellus shale web sites

Ohio Department of Natural Resources' Division of Oil and Gas Resources Management State agency Web site.

ODNR Division of Oil and Gas Resources Management. State drilling permits. List is updated weekly.

ODNR Division of Geological Survey.

Ohio Environmental Protection Agency.

Ohio State University Extension.

Ohio Farm Bureau.

Ohio Oil and Gas Association, a Granville-based group that represents 1,500 Ohio energy-related companies.

Ohio Oil & Gas Energy Education Program.

Energy In Depth, a trade group.

Marcellus and Utica Shale Resource Center by Ohio law firm Bricker & Eckler.

Utica Shale, a compilation of Utica shale activities.

Landman Report Card, a site that looks at companies involved in gas and oil leases.FracFocus, a compilation of chemicals used in fracking individual wells as reported voluntarily by some drillers.

Chesapeake Energy Corp,the Oklahoma-based firm is the No. 1 driller in Ohio.

Rig Count Interactive Map by Baker Hughes, an energy services company.

Shale Sheet Fracking, a Youngstown Vindicator blog.

National Geographic's The Great Shale Rush.

The Ohio Environmental Council, a statewide eco-group based in Columbus.

Buckeye Forest Council.

Earthjustice, a national eco-group.

Stop Fracking Ohio.

People's Oil and Gas Collaborative-Ohio, a grass-roots group in Northeast Ohio.

Concerned Citizens of Medina County, a grass-roots group.

No Frack Ohio, a Columbus-based grass-roots group.

Fracking: Gas Drilling's Environmental Threat by ProPublica, an online journalism site.

Penn State Marcellus Center.

Pipeline, blog from Pittsburgh Post-Gazette on Marcellus shale drilling.

Allegheny Front, environmental public radio for Western Pennsylvania.