Diversified Energy

  • | |

    EQT Retains Shale Rights in Recent Diversified $575M Deal in WV

    On June 19 MDN exclusively brought you the news that Diversified Gas & Oil had purchased EQT’s Huron Shale assets in Kentucky, Virginia and West Virginia for $575 million (see Diversified Gas & Oil Adds to Conventional Assets in KY, VA, WV). The original announcement didn’t name the seller–that information was available only here on MDN. It wasn’t until June 29 that EQT admitted to the world that they were the seller (see EQT Confirms Sale of Huron Shale to Diversified for $575M). EQT said the sale includes nearly 12,000 wells with 200 million cubic feet per day of natural gas production and 2.5 million (!) acres of leases and some 6,400 miles of gathering pipelines. The sale also includes 8 field offices and 250 employees. But like an onion, more details about this story keep getting peeled back one layer at a time. Here’s the newest detail that (until now) we were not aware of: The massive $575 million deal for 2.5 million acres does not include or transfer the right to drill in the deeper shale layers that may exist under that 2.5 million acres. Instead, EQT is retaining those rights…
    Read More “EQT Retains Shale Rights in Recent Diversified $575M Deal in WV”

  • | | | | | | |

    PA DEP Orders CNX, XTO & Diversified to Plug 1,058 Abandoned Wells

    Yesterday the Pennsylvania Department of Environmental Protection (DEP) issued administrative orders requiring three oil and gas companies–Alliance Petroleum Corporation (a subsidiary of Diversified Gas & Oil), XTO Energy, and CNX Resources–to plug 1,058 abandoned oil and gas wells across Pennsylvania. Alliance has 638 wells, CNX has 327, and XTO has 93. In a quick scan of the list of wells to be plugged, we didn’t spot a single shale well. All 1,058 wells are conventional/vertical wells. So why is this news for MDN? Because all three drillers (but in particular CNX and XTO) drill shale wells, and plugging old conventional wells takes time and money–time and money that could be spent on drilling shale wells. It takes anywhere from $10,000 to $100,000 to plug an abandoned conventional oil/gas well. Most of the wells are located in the southwestern part of the state. CNX responded that in reviewing the list, some 190 of the wells in their list (out of 327) were part of a recent asset sale. Here’s the details on where, and how long these companies have, to plug old/abandoned oil and gas wells…
    Read More “PA DEP Orders CNX, XTO & Diversified to Plug 1,058 Abandoned Wells”

  • | | | | | | |

    EQT Confirms Sale of Huron Shale to Diversified for $575M

    MDN exclusively brought you the news, on June 19, that Diversified Gas & Oil had purchased EQT’s Huron Shale assets in Kentucky, Virginia and West Virginia for $575 million (see Diversified Gas & Oil Adds to Conventional Assets in KY, VA, WV). At that time, Diversified did not disclose who it had purchased the assets from. MDN provided a guess, but that guess proved wrong. Within an hour of posting about the sale, an MDN tipster confirmed for us the seller was EQT, which we subsequently updated, providing the MDN audience with the inside skinny. On Friday, June 29, EQT issued a press release (below) confirming that yes, it was they who had sold the acreage/assets, including nearly 12,000 wells with 200 million cubic feet per day of natural gas production, to Diversified. The deal also includes 2.5 million acres of leases and some 6,400 miles of gathering pipelines. What we didn’t know about the deal (until now) is that it includes 8 field offices and 250 employees. Here’s the EQT announcement with full details of the deal…
    Read More “EQT Confirms Sale of Huron Shale to Diversified for $575M”

  • | | |

    Diversified Gas & Oil Adds to Conventional Assets in KY, VA, WV

    UPDATE: A source has shared with us who is doing the selling–see our note below.

    Diversified Gas & Oil, founded in 2001, is an operator of oil and gas wells (and pipelines). According to the Diversified website, the company’s “innovative, disciplined investment strategy is focused on the acquisition of mature, low-decline and low-risk wells, enhancement of operations with a focus on efficiency, and maximization of profitability for shareholders.” Diversified issued a press release last week to say it has signed a letter of intent to purchase 2.5 million acres of leases, and 11,350 wells, in Appalachia–for $575 million. The acreage and wells are located in Kentucky, Virginia and West Virginia. Although the press release doesn’t say, the wells are almost certainly all conventional wells (no shale wells). We were not able to determine if any of the acreage includes rights to drill shale wells. Given the company’s focus on “low-decline and low-risk wells,” we have to conclude they target only conventional wells, since shale wells are high decline and moderate to high risk (sink a shale well in the wrong place and you just blew $7-8 million). Diversified recently closed on deals to pick up acreage and wells from both Alliance Petroleum Corporation and CNX Resources. Who’s the seller this time? We have a guess about who it may be…
    Read More “Diversified Gas & Oil Adds to Conventional Assets in KY, VA, WV”