Another $1.25B for Buckeye Drilling

ST. CLAIRSVILLE – By raising another $1.25 billion, former Chesapeake Energy CEO Aubrey McClendon now has nearly $3 billion to drill Utica Shale wells across eastern Ohio via his American Energy Partners firm.

The Oklahoma City-based firm plans to frack at least 1,600 wells over the next decade in Ohio counties such as Belmont, Jefferson, Harrison, Monroe, Guernsey and Noble. Belmont County Recorder’s Office documents show McClendon’s company now has control of multiple lease agreements.

Many eastern Ohio mineral owners who signed leases with Hess Corp., XTO Energy, Phillips Exploration and Paloma Resources now have contracts with McClendon’s new company, which now has more than 260,000 acres leased in the aforementioned counties.

After working in the Utica for nearly three years, New York City-based Hess Corp. sold 74,000 Ohio acres to the McClendon firm for $924 million.

Hess originally entered the Utica via its $750 million purchase of Marquette Exploration in 2011.

Despite selling acreage to McClendon, Hess officials will retain their liquids-rich properties in the Utica. In 2013, the company drilled 29 and fracked 24 wells its Utica Shale joint venture with Consol Energy. Hess plans to use $550 million to frack wet Utica wells this year.

Fort Worth, Texas-based XTO is a subsidiary of Exxon Mobil, the world’s largest publicly owned oil and natural gas company. XTO holds many leases in eastern Ohio, as many mineral owners – including the Union Local Board of Education and the Martins Ferry Board of Education – agreed to lease land for $4,950 per acre with 19 percent payments on production royalties. The company also controls the leases local residents may have previously signed with Phillips Exploration.

Randy Cleveland, president of XTO, said American Energy Partners will take over 30,000 XTO acres in Belmont, Jefferson and Harrison counties, while XTO will continue to hold 55,000 Utica acres.

McClendon retired from Chesapeake April 1 and took a 2.5 percent personal interest in Brooke, Ohio, Marshall and Wetzel County Chesapeake operations.