A Texas-based energy company has scrapped a proposed deal to sell nearly 104,000 acres in Ohio’s Utica shale.
EV Energy Partners Executive Chairman John B. Walker, in a teleconference from New Yorkk today, said efforts to put together a Utica sale with an unnamed buyer have failed.
That company made an acceptable cash offer for most of EV Energy Partner’s acreage, but the terms of the agreement sought by the unnamed firm were unacceptable, he said.
Negotiations with that company stretched over several months and are continuing, he said.
But his company is reopening talks with other parties on smaller packages in eastern Ohio and surrounding areas, Walker said.
The price and the terms of the sale must be satisfactory, he said.
EV Energy Partners, based in Houston, has said it decided to sell off the leased land rather than invest the money to drill natural gas-oil wells itself. Each well can cost $6 million.
The available land includes 40,300 acres in Stark County; 21,800 acres in Tuscarawas County; 12,300 acres in Trumbull County; and 10,900 acres in Carroll County. That ialso ncludes Guernsey County, 4,600 acres; Harrison County, 1,700 acres; Mahoning County, 4,400 acres; Muskingum County, 6,200 acres; Noble County, 1,000 acres, and other unidentified counties, 500 acres.
Walker said his firm, the publicly traded arm of privately held EnerVest Ltd., had initially planned to complete the sale by Jan. 1 and later by this time.
Some had estimated that the sale could generate as much as $6 billion.
Walker’s company holds some of the most attractive Utica lands that are already producing natural gas, oil and natural gas liquids: ethane, butane and propane.
EnerVest is a partner with Chesapeake Energy Corp. and the French energy company, Total SA, in drilling on 619,000 acres in 10 counties in eastern Ohio.
EV Energy Partners also intends to keep an additional 73,500 acres in eastern Ohio and western Pennsylvania, at least for now. That includes acreage in Summit, Portage and Wayne counties. The acreage being retained totals 56,600 acres in Ohio and 16,900 acres in Pennsylavnia.
The company could opt in the future to drill on the 73,500 acres or it could decide to sell off or swap that land, company officials said.
The company said it intends to keep its shallow vertical-only wells in Ohio’s Clinton sandstone and the deeper Knox wells.
It is a key player in investing in pipelines and gas-processing facilities in eastern Ohio.
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.
The Ohio Environmental Council, a statewide eco-group based in Columbus.
Earthjustice, a national eco-group.
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.
Pipeline, blog from Pittsburgh Post-Gazette on Marcellus shale drilling.
Allegheny Front, environmental public radio for Western Pennsylvania.