Rice Energy to buy Vantage Energy for about $2.7 bn
28 September 2016
US oil and natural gas company Rice Energy Inc yesterday struck a deal to buy Vantage Energy for about $2.7-billion to expand its shale gas acreage in the US.
The deal comes just two weeks after Colorado-based Vantage filed to go public.
As part of the deal, Rice Midstream Partners, a master limited partnership spun out of Rice Energy, will buy Vantage's midstream assets, including 30 miles of gathering pipelines in Greene County and compression infrastructure, for $600 million.
The Vantage deal will give Rice Energy around 231,000 net acres in the Marcellus and Ohio Utica cores with an inventory of 1,164 drilling locations that generate average single well returns of approximately 95 per cent at strip pricing.
The deal will make Rice Energy the largest leaseholder in Greene County. The company currently has operations in Washington and Greene counties in Pennsylvania, and in Belmont County, Ohio.
Rice Midstream Partners will control one of the largest and most concentrated core dry gas acreage dedications in the Marcellus Shale, covering approximately 199,000 acres in Washington and Greene Counties.
"This deal represents the largest core dry gas Marcellus acquisition to date, one that is truly transformational for Rice Energy, Rice Midstream Partners and our respective shareholders. This acquisition adheres to our proven strategy of pursuing core shale gas acreage, leveraging our industry-leading technical shale team to deliver best-in-class well results and capturing a greater share of the value chain through our premier midstream services business,'' said, Daniel Rice IV, CEO of Rice Energy.