May 3, 2016 2 min read

PITTSBURGH – EQT Corp. said Monday it signed a definitive agreement to acquire 62,500 net acres, and current natural gas production of 50 million cubic feet per day from Statoil USA Onshore Properties Inc. for $407 million.

The transaction is expected to close in early July.

EQT said in a news release the acreage, primarily located in Wetzel, Tyler and Harrison counties of West Virginia, will add a sizeable amount of acreage within EQT’s core development area and complements its adjacent operations in Wetzel County.

The acquisition includes existing Marcellus production and approximately 500 undeveloped locations expected to have an average lateral length of 5,600 feet. The company noted much of the acreage is contiguous with its existing development area, which will enable it to extend lateral lengths from 3,000 to 6,500 feet, which will reduce overall costs and deliver stronger well economics.

In line with the company’s consolidation strategy, the acquisition increases EQT’s core undeveloped Marcellus acreage by 29 percent. It also includes drilling rights on an estimated 53,000 net acres that are undeveloped and prospective for the deep Utica.

According to EQT, assets include 31 Marcellus wells, 24 of which are currently producing – three complete, not online and four drilled, not complete. The resource potential of the acreage is estimated at 9.2 trillion cubic feet; and 87 percent of the acreage is either held by production or has lease expiration terms that extend beyond 2018.