NEW MARTINSVILLE - With its construction of a large natural gas pipeline ongoing across West Virginia, Triad Hunter LLC is expanding its operations with a $39.75 million acquisition of Marcellus Shale assets in Wetzel and Lewis counties.
"We plan to be one of the most active drillers in northwest West Virginia in 2011 and have made the financial commitments in the midstream area to realize the greatest value possible from each molecule of natural gas produced," said Gary C. Evans, chairman and CEO of Magnum Hunter Resources Corp., parent company of Triad Hunter.
PostRock Energy Corp. is selling the assets to Triad Hunter. The properties consist of eight developed and producing wells, six developed but non-producing wells, two wells behind pipe, and 15 undeveloped locations.
According to Triad Hunter estimates, the properties in Wetzel and Lewis counties hold 24.3 billion cubic feet of gas. The total acreage being acquired by Triad Hunter includes approximately 11,378 gross acres located in Wetzel and Lewis counties. The acreage is located in the general proximity to Triad Hunter's existing Mountain State assets, more specifically acreage located in Tyler, Pleasants, and Doddridge counties.
The acquisition is subject to certain conditions and scheduled to close in two phases, each of which is expected to be completed by mid-January. The first closing contemplates the sale of the Wetzel County assets for $28 million and the second closing contemplates the sale of the Lewis County assets for $11.75 million.
Evans noted, "Since our initial investment in this region beginning with the acquisition of Triad Hunter earlier this year, we have continued to expand our company's exposure to this resource play with a primary focus in West Virginia. This has been accomplished via a combination of new leases, farm-in's, joint ventures, and now this acquisition which further expands our operations into two additional counties."
"All of these new assets are either within close proximity to our existing Eureka Hunter pipeline system or adjacent to our expansion plans for next year," he added.