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Vantage Energy to Take Another Crack at IPO

Two years after it withdrew a $400 million offering, Marcellus and Barnett shale-focused Vantage Energy Inc. has refiled with the U.S. Securities and Exchange Commission to take the company public, snapping a dry spell for exploration and production (E&P) companies looking to raise big money in market debuts.

In a Form S-1, Englewood, CO-based Vantage said it is the largest leaseholder in Greene County, PA, in a core of the Appalachian Basin that's prospective for the Marcellus, Upper Devonian and Utica shales. According to the filing, Vantage intends to raise $100 million on the New York Stock Exchange under the ticker symbol "VEI", an amount that could grow as the offering draws near. No E&P company has raised that much in an initial public offering (IPO) since 2014.

The company has 88,634 net acres in Greene County, up from 57,771 net acres when it filed for an IPO in 2014 (see Shale DailyJuly 8, 2014). It has another 37,481 net acres in the Barnett Shale in Tarrant, Denton and Wise counties, TX. Vantage has grown its production from 18 MMcfe/d in 2011 to about 399 MMcfe/d in 2Q2016. The Appalachian Basin accounted for 268 MMcfe/d in the second quarter, while the Barnett produced 131 MMcfe/d, according to the company's prospectus.

Vantage also said it gathers all of its natural gas production in Greene County, where it owns a 400 MMcf/d system. During the first half of this year, throughput on the system was 325 MMcf/d. Vantage said it's designed to grow to 1.8 Bcf/d.

Founded in 2006 by CEO Roger Biemans and CFO Tom Tyree, Vantage entered the Barnett in 2007. By 2010, it had entered the Appalachian Basin. The company said it reduced its drilling and completions during the first half of this year to weather the commodities downturn, but it's currently running two rigs in the Marcellus, with plans to add a third there by the end of the year. As a result, the company expects it volumes to increase significantly next year.

Vantage filed to raise $400 million in July 2014 as oil prices collapsed. It later withdrew the offering as the markets were growing colder to the oil and gas sector. Noble Energy Inc., which scrapped a planned IPO last fall for its onshore U.S. midstream business, raised $281 million on Wednesday in the year's first energy partnership offering (see related story). The Noble Midstream Partners LP IPO exceeded expectations in its first day of trading, pricing 12.5 million shares at $22.50, or above the initial estimate of $19-21.

Some in the sector still aren't ready to test the waters, however. Philadelphia Energy Solutions Inc., the East Coast's largest refiner and owned by the Carlyle Group LP and Energy Transfer Partners LP, on Tuesday withdrew its registration statement amid a challenging environment that has seen lower refining profitability. The move followed a similar decision to postpone the IPO last year.

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