Diversified CEO Says Majority of Co.’s Wells Can Produce 50+ Yrs

Diversified Energy (formerly Diversified Gas & Oil) is a company that continues to fascinate us. Diversified's CEO, Rusty Hutson, Jr., started the company in 2001 with just 35 old conventional wells in West Virginia. Today the company owns over 69,000 gas and oil wells! Most of them are conventional and located in the Appalachian region, although the company now owns over 400 shale wells too. The company's strategy is to let others locate and drill new wells, and obtain the initial rush of production. But as those wells age and produce a small trickle of what they initially produced, most companies look to sell them. That's where Diversified comes in, buying up those older, lower-producing wells. Even though the production is low, those old wells are like annuities that just keep steadily producing--for years. In fact, Hutson said in a recent interview that the majority of the 69,000+ wells Diversified owns will produce for "50, 60 years or more."

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