Southwestern Energy Company SWN,
announced that it has signed an agreement to purchase oil and gas assets
including approximately 46,700 net acres in northeast Pennsylvania from WPX
Energy, Inc. WPX for approximately $300 million, subject to customary
closing conditions. This acreage is currently producing approximately 50
million net cubic feet of gas per day from 63 operated horizontal wells. Also
as part of this transaction, Southwestern will assume firm transportation
capacity of 260 million cubic feet of gas per day predominantly on the
Millennium pipeline effective upon closing. The transaction is conditional
upon receiving a waiver from the Federal Energy Regulatory Commission
regarding transfer of the firm transportation capacity and is currently
expected to close in the first quarter of 2015. Southwestern intends to use
its revolving credit facility to finance the acquisition.
"We are very excited about the addition of this asset and firm transportation
capacity to our portfolio," commented Steve Mueller, President and Chief
Executive Officer of Southwestern Energy. "This acreage position complements
our existing Marcellus acreage in northern Susquehanna County where we have
recently seen very good results from two of our wells, the Hughes North 1H and
the Dayton 4H. The Hughes North 1H has completed the entire lateral length of
4,981 feet and had a maximum 24-hour rate of 4.7 million cubic feet per day.
The Dayton 4H has a total lateral length of 5,278 feet and tested a maximum
24-hour rate of 4.5 million cubic feet per day from the first 30% that is
completed to date. Further, the additional firm transportation capacity adds
to our existing firm transportation portfolio to provide 1.3 Bcf per day of
firm transport capacity upon closing and growing to 1.4 Bcf per day by the end
of 2016. The immediate availability of this firm transportation provides the
pathway for ongoing growth in production over the next three years and the
added acreage solidifies future value through a growing well inventory."
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