Tuesday, August 24, 2010

Potter County, PA: Marcellus shale update

By Andrea: http://oilshalegas.com

SM Energy Company (SM) announced yesterday that they will engage in either a sale or joint venture of their 43,000 acres of land in the Marcellus shale in Potter County, PA and in McKean County, PA:

SM Energy Company (NYSE: SM) announces today that it is planning to raise at least $300 to $500 million through divestitures of non-strategic assets and/or joint venture agreements over the next 12 months, including the following potential transactions.

Part of the planned activities include the potential sale or joint venture of the Company's roughly 43,000 net acre Marcellus shale position in McKean and Potter counties, Pennsylvania. Bank of America Merrill Lynch has been engaged to market these assets. SM Energy also announces today that its second Marcellus well in McKean County, the Potato Creek 3H, began producing to sales in early August at a facility constrained initial gas production rate of over 7 MMCFE/D.

The Company has also engaged Albrecht & Associates to market a package of non-core, primarily proved developed properties, with a goal of completing a transaction by the end of 2010. Current production associated with this package as it is currently configured is 13 MMCFE/D.

Tony Best, President and CEO, commented, "Our goal is to continue to refine our portfolio in a manner that optimizes value for our stockholders. A key element in support of that goal will be divesting non-strategic assets and/or entering into joint ventures to fund the development of our core resource play opportunities."

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