Atlas and Reliance Industries have agreed to acquire, through a series of transactions for the benefit of the joint account of Atlas and Reliance, 42,344 highly prospective Marcellus Shale acres in Fayette, Washington, Indiana, Westmoreland, Armstrong and Clarion Counties of Pennsylvania for an average purchase price of $4,532 per acre. This acreage is contained within the area of mutual interest ("AMI") Atlas has established with Reliance, and Reliance has agreed to exercise its right to acquire its 40% interest in the new acreage.
Substantially all of the acreage to be acquired is held by production and is either contiguous with the joint venture's existing acreage or is in concentrated blocks of acreage. The Company believes that it will be able to drill over 450 horizontal wells on this acquired acreage assuming 1,000 foot spacing between lateral wells.
As a result of these transactions, the Atlas/Reliance joint venture will now control approximately 343,000 Marcellus Shale acres, of which approximately 206,000 acres are net to Atlas. Atlas controls an additional 280,000 acres that are prospective for the Marcellus Shale outside of the AMI.
"These transactions reflect the desire of both Atlas and Reliance to add highly prospective acreage that will enable our joint venture to accelerate development," stated Richard D. Weber, President of Atlas Energy, Inc. "The contiguous nature of this acreage will enable us to concentrate our development and we intend to develop a large percentage of this acreage in the next five years."
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