Rice Energy buys wells from Chesapeake Appalachia; plans expansion

[theHandpuppet]

the Pittsburgh Tribune
Pennsylvania
Rice Energy buys wells from Chesapeake Appalachia
By John D. Oravecz
Tuesday, July 8, 2014

Rice Energy Inc. said on Monday that it signed an agreement to acquire 22,000 leased acres and 12 developed Marcellus shale wells in western Greene County from Chesapeake Appalachia LLC and partners for about $336 million in cash and debt.

Cecil-based Rice Energy said it expects to complete the purchase in August. It will increase acreage by 24 percent, Marcellus well locations by 47 percent and production by about 20 million cubic feet of natural gas a year, with five wells in various stages of development.

CEO Toby Rice said the company is evaluating raising additional capital for the acquisition by selling stock. Rice remains on track to add a total of 30,000 leased acres this year, he said

Read more: http://triblive.com/business/businessbriefs/6405603-74/rice-wells-chesapeake#ixzz36tBXPLH5

[tech3149]

1. What most don't understand is this was inevitable

Early studies showed that fracking wells showed a significant reduction in output within two years. Later studies showed the reduction as being drastic. Chesapeake is finding the wells no longer economically viable so finding a buyer is the only way to get out while still ahead.