Pin Oak Energy Partners LLC said Wednesday it has completed a deal to acquire 43,000 acres in northwestern Pennsylvania from Royal Dutch Shell plc affiliate SWEPI LP, buttressing its inventory of deep rights across a region that saw heavy development in the early days of the Appalachian shale boom.
The acreage is mostly held by production (HBP) and prospective for the Utica Shale, Akron, OH-based Pin Oak said. Terms of the transaction were not disclosed.
“This transaction further bolsters the company’s deep Utica rights in the oil and wet gas windows of the play,” said Pin Oak’s Mark Van Tyne, chief business development officer. “The fact that the majority of the acreage is HBP affords us time to more thoroughly evaluate the region as we high grade locations for economic development.”
The acquisition includes drilled and completed horizontal Utica wells that have not been placed online, in addition to well pads where drilling has yet to occur.
Northwest Pennsylvania has long played host to the state’s legacy producers and given rise to some of the more prolific shallow oil and gas fields over the decades. Unconventional operators targeted the region when shale development first got underway in the basin, focusing on the Utica in places like Lawrence, Mercer, Crawford and Venango counties before flocking to more lucrative acreage in other parts of the basin.
Shell entered the basin in 2010 after acquiring 750,000 acres from East Resources. The major eventually grew its leasehold position to 850,000 acres primarily in Pennsylvania, with additional assets in Ohio and New York, where high-volume hydraulic fracturing is banned. Shell, which remains one of Appalachia’s largest leaseholders, is focused on Mercer County in northwest Pennsylvania and Tioga and Bradford counties in the northeastern part of the state.
The exact counties where the 43,000 acres Pin Oak acquired weren’t clear, but the company said the deal increased its position in Mercer, Crawford and Venango counties to 72,600 acres. Overall, the company now holds 167,000 net deep acres across Appalachia that are 99% HBP.
The privately-owned producer was established in 2015 by CEO Christopher Halvorson and Van Tyne, who both formerly worked for the now defunct Appalachian operator AB Resources LLC. The company has been on a buying spree of sorts over the last two years, growing with the purchase of conventional and unconventional oil and gas assets in Ohio and Pennsylvania.