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EQT Shareholders Vote July 16 on $2.9B Deal to Buy Alta Resources

Toby Rice, CEO of EQT

A little over a month ago MDN brought you the big news that the voraciously hungry EQT is gobbling up the Marcellus assets of yet another driller, Alta Resources, for $2.9 billion (see EQT Buys Alta Res. PA Assets for $2.9B in “Transformative” Deal). We later told you the company is floating $1 billion in new notes to help fund the deal (see Why Did EQT Buy Alta for $2.9B? Floats $1B in IOUs to Finance Deal). Where will the other $1.925 billion come from? By floating 105,306,346 new shares of EQT common stock. Shareholders will meet on July 16 to vote on the deal to buy Alta’s Marcellus assets, including the plan to float new stock.
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Weekly Shale Drilling Permits for PA, OH, WV: May 17-23

All three M-U states received permits to drill new shale wells last week, but the numbers were all down. Pennsylvania issued just 8 permits with 6 in the northeastern part of the state and 2 in the southwestern region. Ohio issued four permits, all for the same driller on the same well pad in the same county. And West Virginia issued just one new permit for last week.
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Why Did EQT Buy Alta for $2.9B? Floats $1B in IOUs to Finance Deal

click for larger version

EQT is floating $1 billion worth of “senior notes” (what we call IOUs) to help pay the cash portion of a deal to buy Alta Resources for $2.9 billion (see EQT Buys Alta Res. PA Assets for $2.9B in “Transformative” Deal). The Alta deal, with most of its acreage and wells located in the northeastern PA corridor, will add an extra 1 billion cubic feet per day (Bcf/d) to EQT’s existing production of 4.9 Bcf/d. It makes EQT, already the country’s #1 natural gas producer, even more massive. The question is, why buy Alta and not some other company?
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EQT Buys Alta Res. PA Assets for $2.9B in “Transformative” Deal

Of course, there was big news to report on Friday, the day MDN took off as a brief vacation day (the graduation ceremony was great!). The big news from last Thursday afternoon and Friday was (a) EQT’s first quarter update, and (b) EQT announced it has cut a deal to buy the northeastern Pennsylvania Marcellus assets of Alta Resources for a whopping $2.9 billion–pretty close to the asking price (see Alta Resources Shopping 547K Marcellus Acres, Asking $3B). EQT’s 1Q21 update kind of got swallowed up in all the chatter about the Alta deal. We break it all down below.
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EQT, Chesapeake Interested in Buying M-U Driller Alta Resources

We don’t write much about Alta Resources, a shale drilling company co-founded by the inventor of shale fracking, George Mitchell. But that doesn’t mean Alta doesn’t drill in the Marcellus. In 2020 Alta was in the Top 10 PA drillers list (see Top 10 Shale Drillers in PA for 2020, by Number of Wells Drilled). Alta owns some 547,000 gross (239,000 net) acres producing natural gas from approximately 900 wells in the Marcellus Shale across Bradford, Wyoming, Sullivan, Lycoming, Clinton, and Centre counties in northeast Pennsylvania. In February we told you that Alta is shopping all of their considerable Marcellus assets, looking for a buyer (see Alta Resources Shopping 547K Marcellus Acres, Asking $3B). Looks like EQT and Chesapeake Energy have both been creepin’ ’round Alta’s back stairs…
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Top 10 Shale Drillers in PA for 2020, by Number of Wells Drilled

The data crunchers at the Pittsburgh Business Times have been sifting through the data for 2020 and have composed a list of the “Largest Pennsylvania Shale Gas Drillers in 2020.” The PBT list ranks drillers by the number of wells drilled in PA for all time, including right up through the end of 2020. We resorted their list to reveal the number of wells “added” (drilled) in PA for 2020, to generate the following list of the top 10 drillers from 2020:
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Weekly Shale Drilling Permits for PA, OH, WV: Feb 1-5

Two of three M-U states received permits to drill new shale wells last week. Pennsylvania received 22 new permits (second week in a row with 22 new permits). Ohio received zero new permits. And West Virginia received 6 new permits (down from 8 new permits the previous week).
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Alta Resources Shopping 547K Marcellus Acres, Asking $3B

We don’t write much about Alta Resources, a shale drilling company co-founded by the inventor of shale fracking, George Mitchell. But that doesn’t mean Alta doesn’t drill in the Marcellus. The company owns some 547,000 gross (239,000 net) acres producing natural gas from approximately 900 wells in the Marcellus Shale across Bradford, Wyoming, Sullivan, Lycoming, Clinton, and Centre counties in northeast Pennsylvania. Alta is shopping all of their considerable Marcellus assets, looking for a buyer.
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Weekly Shale Drilling Permits for PA, OH, WV: Jan 25-29

All three M-U states received permits to drill new shale wells last week. Pennsylvania received 22 new permits. Ohio received 2 new permits. And West Virginia received 8 new permits.
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Two-Alarm Fire at Alta Resources Well Pad in Lycoming County, PA

Alta glycol dehydration unit that caught fire (click for larger version)

A glycol dehydration unit (removes water vapor from natural gas) caught fire at an Alta Resources well pad in Lycoming County, PA, on Saturday. The two-alarm blaze was noticed by a passerby Saturday morning. Multiple fire departments responded and fortunately, nobody was hurt. The fire did not spread beyond the glycol dehydration unit.
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Weekly Shale Drilling Permits for PA, OH, WV: Nov. 16-20

Last week Pennsylvania issued 11 new shale well drilling permits, all but one of them in the northeastern (dry gas) part of the state. Ohio issued one new permit, and West Virginia issued 2 new shale well permits.
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Alta Resources Uses Software to Make Marcellus Wells Produce More

We don’t often see news about a Marcellus producer called Alta Resources. Alta was one of the first drillers we wrote about just after launching the MDN website back in 2009 (see Texas Billionaire George Mitchell is Betting on the Marcellus in PA). George Mitchell, widely recognized as the father of shale energy, was a partner in Alta and had glowing things to say about the Marcellus. Mitchell died in 2013. His legacy lives on. Alta is in the news again. The company recently began using a software program from Ambyint to increase production across the 900 or so Marcellus wells it owns in northeastern PA.
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Marcellus Companies $tep Up to Help During COVID-19 Crisis

Companies in the Marcellus/Utica shale industry have stepped up and given money, and in some cases retooled manufacturing operations, in order to help communities, first responders and medical professionals respond to the COVID-19 coronavirus pandemic. Companies like ExxonMobil, Range Resources, Cabot Oil & Gas, EQT, Alta Resources, Chevron, Greylock Energy, Olympus Energy, Penn E&R, Southwestern Energy and others. We are gratified and proud of the industry where we hang our hat.
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Ultra Petroleum Sells Its 72K Marcellus Acres to Alta Res. for $115M

Ultra Petroleum, based in Houston, TX, is an independent exploration and production (E&P) company mainly focused on drilling in the Green River Basin of Wyoming. Ultra also drills for oil in the Uinta Basin/Three Rivers area in Utah. In addition, Ultra maintains a “non-operated” (someone else does the drilling) position in the Pennsylvania Marcellus shale with leases on 72,000 net acres–no small amount. As recently as May of this year Ultra CEO Michael Watford signaled that the Marcellus acreage is not a drain on their budget, so they would just hold on to it and see what happens (see Ultra Petroleum 1Q17 – Holding on to 72K Marcellus Acres, for Now). What happened is the company saw an opportunity to cash in that acreage, and the wells producing on it, for $115 million in cold, hard cash that they can use elsewhere. Ultra announced a deal yesterday to sell all of their Marcellus acreage/wells, mostly located in Centre and Clinton counties in north-central PA, to Alta Resources. Alta is not a name we’ve seen a lot, but they were one of the first drillers we wrote about just after starting the MDN website back in 2009 (see Texas Billionaire George Mitchell is Betting on the Marcellus in PA). George Mitchell, widely recognized as the father of shale energy, was a partner in Alta and had glowing things to say about the Marcellus. Mitchell died in 2013. His legacy lives on. According to Alta’s website, the company has drilled or participated in more than a thousand wells–in Arkansas, Texas, Louisiana, Alabama, Pennsylvania and Alberta, Canada. The most recent news related to Alta in our area, prior to yesterday’s announcement, was their purchase of Anadarko’s Marcellus assets for $1.24 billion in December 2016 (see Anadarko Sells All Marcellus Assets for $1.24B to Alta Resources). Seems like December is the month to watch for an Alta purchase in the Marcellus!…
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Anadarko Sells All Marcellus Assets for $1.24B to Alta Resources

One of the country’s largest oil drillers is calling it quits in the Marcellus natural gas play. Earlier today Anadarko announced it has cut a deal to sell all of its Marcellus acreage and wells to Alta Resources for $1.24 billion. The deal is big, including 195,000 acres and daily production from wells that averages 470 million cubic feet per day (MMcf/d). That’s the news you’ll get everywhere else. Here’s the part of the story you’ll read exclusively here on MDN: Anadarko has a partner in the Marcellus–Mitsui–which is also selling their interest in the PA Marcellus to Alta, for $207 million. Also, background on the deal you won’t read anywhere else: Alta was an early investor in the Marcellus, but sold out all of their acreage in 2010. Now they’re back. Anadarko and Mitsui sold for far less than the acreage was valued at in 2010–we’d call it getting taken to the cleaners. MDN sorts it all out below…
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Susquehanna River Basin Commission Approves 26 Applications for Water Use

At a recent meeting of the Susquehanna River Basin Commission held in Scranton, PA, the group approved 26 applications to use water from the Susquehanna River watershed for drilling in the Marcellus Shale deposit. At the meeting, the Commission imposed new rules about posting signs at sites along rivers and creeks where water is drawn for use in drilling.

Among the permits approved by the commission, according to the Susquehanna Independent Weekend, is permission for ALTA Operating “to draw up to 3 million gallons per day from the Susquehanna River and 99,000 gallons per day from Snake Creek, both in Susquehanna County.”

Read the full article: New rules for gas drillers