DGO completes Ohio acquisition
Diversified Gas & Oil has completed its acquisition of all the conventional assets of Eclipse Resources in Ohio for $4.8m.
The purchase was funded through a combination of a GBP2.7m bond issue, senior secured funding and equity.
The assets acquired included approximately 1,300 conventional oil and gas wells producing approximately 250 barrels of oil per day and 3,000 MCF per day of natural gas production. This is the company'''s largest acquisition in Ohio to date.
DGO now owns and operates approximately 5,000 conventional wells in Ohio, West Virginia and Pennsylvania, producing approximately 450 bopd and 13,000 MCF per day of natural gas.
Chief executive Rusty Hutson said: "The company continues to identify strong M&A opportunities as part of our ongoing strategy to consolidate and expand our position in the new potential significant Appalachian Basin."
On 7 March the company listed an information memorandum for the issue of up to a further GBP3.6m of bonds on the ISDX Growth Market.
"Conventional" what sands, shales or depths are we talking?
I am thinking less that 3500 to 4000 feet. I can't remember the name of the company they bought a couple of years ago, but it was old shallow wells that held the deep. Look at the production numbers in the article, the wells are not producing much on a daily basis for the number of wells listed, which is 1300. Appears to me that what Eclipse has done is to sell their "shallow" rights/production.
probably old Clinton wells that were drilled 30 to 40 years ago
Smart move if they want to focus solely on shale. They essentially got paid around a year's worth of revenue to offload a bunch of plugging liabilities ($5 million to $9 million) and probably have covenants in place to ensure their deep rights are protected.
Eclipse dumping junk
if i have a conventional well that is HBP ing my property for Eclipse, then they no longer own it am i still held by their production ??? what production ? eclipse is no longer producing on my land, Right... Help me understand this.
you are still HBP.......as long as that well is "producing",,,,,doesn't matter how many times it gets sold.
Oh and i forgot to ask who now owns the old Oxford pipeline that crosses my property and needs repair ??
Eclipse or DGO ??
My speculation is that Eclipse still owns the lease on the property. They no longer service the old shallow wells.
if you have a pipeline needing repair call the EPA they know who owns it .....for sure
Likely the State regulates gathering lines. Read this: http://www.api.org/~/media/files/oil-and-natural-gas/pipeline/gathe...
These wells are HBP, but probably only get produced a couple of times a year to hold the lease.
Many people think it's a sham.
Some people want to tax these old wells, claiming to be HBP, $2,500 to $5,000 a year to be in HBP status.
Those people figure that such a tax will end these sham HBP well claims, returning the land to the mineral owners.