EQT Announces Strategic Marcellus Acreage Acquisition

Here is an interesting report that came to me by way of the Responsible Drilling Alliance (RDA) in Williamsport, PA.

There have been numerous announcements on various websites about  EQT Corp. acquiring acreage for drilling and other gas extraction activities. Most have indicated this acquisition is an outright purchase of the land – rather than a long-term lease. Below is what POGAM (Pennsylvania Oil & Gas Association – an industry alliance) and EQT say about this acquisition. The links for each announcement lead to the full releases from EQT and POGAM.

If EQT’s acquisition is an outright purchase and not a lease, this is appears to be a new (or at least an increasing) way to acquire rights to drill in the Marcellus Shale. And it is something that taxpayers and landowners need to be aware of. If oil and gas companies end up owning large chunks of our state, particularly in places adjacent to privately-owned residential areas, what will be the outcome long-term? Will big oil and gas, out-of-area corporations, care as much as locals do for public health, safety, the environment and the local economy?

If anyone receiving this message can clarify the nature of this EQT acquisition – purchase, lease, something in-between – please send that clarification to me.

EQT’s announcement:

EQT Announces Strategic Marcellus Acreage Acquisition;

Increases EUR per Marcellus Well;

Provides Update on Latest Marcellus Well

PITTSBURGH, March 2, 2010/ PRNewswire-FirstCall/ –EQT Corporation (NYSE: EQT) today

announced that it will acquire approximately 58,000 net acres in the Marcellus Shale from a group

of private operators and landowners. The acreage is located primarily in Cameron, Clearfield, Elk and

Jefferson counties in Pennsylvania. The purchase includes a 200 mile gathering system, with

associated rights of way, and approximately 100 producing vertical wells.

At closing, EQT will pay approximately $280 million, 90% with EQT stock and 10% with cash.

Following the closing of the acquisition, EQT will hold more than 500,000 net acres in the highpressure

Marcellus shale fairway. The company expects the transaction to close by April 30, subject

to customary closing conditions.

“We are pleased to add to our substantial, firmly held acreage position in the heart of the

Marcellus fairway. We have extensive midstream assets and firm contracts to gather and transport

natural gas to the lucrative eastern markets,” commented Murry Gerber, chairman and chief executive

officer. “ ….

To read the full EQT release, click here:

http://www.eqt.com/docs/pdf/pressRelease/20100302.pdf

POGAM’s announcement:

EQT announces Marcellus acreage acquisition, ups per-well production estimate

PITTSBURGH, PA (3/3/2010) – EQT Corporation announced it will acquire approximately 58,000 net acres in the Marcellus Shale from a group of private operators and landowners. The acreage is located primarily in Cameron, Clearfield, Elk and Jefferson counties in Pennsylvania. The purchase includes a 200-mile gathering system, with associated rights of way, and approximately 100 producing vertical wells.

At closing, EQT will pay approximately $280 million, 90 percent with EQT stock and 10 percent with cash. Following the closing of the acquisition, EQT will hold more than 500,000 net acres in the high-pressure Marcellus shale fairway. The company expects the transaction to close by April 30….

To read the full POGAM release, click here:

http://www.pogam.org/news/view.asp?pID=1334