Rice Energy Inc. (NYSE: RICE) announced Feb. 12 acquired a 28-mile gathering system within the Marcellus shale of Pennsylvania from M3 Midstream LLC for $110 million in cash.
Rice Poseidon Midstream LLC, Rice Energy's wholly owned subsidiary, executed the purchase and sale agreement for the acquisition of the gathering assets in eastern Washington and Green counties, Pa., from M3 Appalachia Gathering LLC, a wholly owned subsidiary of M3 Midstream.
The northern 28-mile system in Washington County is supported by long-term contracts with acreage dedications covering 20,000 acres from third parties.
The acquisition permits the necessary rights of way in Washington and Greene counties to construct an 18-mile gathering system connecting the northern system to the Texas Eastern pipeline. Once fully constructed, the acquired systems are expected to have an aggregate capacity of over 1 billion cubic feet per day (Bcf/d).
"In addition to acquiring a strategic gathering system supported by third-party contracts, the footprint of the northern system provides us with the opportunity to accelerate development drilling and strengthen our leasing efforts in a key operational area," Daniel J. Rice IV, Rice CEO, said in the release.
The acquisition will also allow Rice to expedite the construction and in-service date of its pipeline to Texas Eastern and further improve its Washington County takeaway plan, Rice said.
The effective date of the transaction is March 1 and is expected to close in March.
Recommended Reading
BKV Prices IPO at $270MM Nearly Two Years After First Filing
2024-09-25 - BKV Corp. priced its common shares at $18 each after and will begin trading on Sept. 26, about two years after the Denver company first filed for an IPO.
Viper Energy Offers 10MM Shares to Help Pay for Permian Basin Acquisition
2024-09-12 - Viper Energy Inc., a Diamondback Energy subsidiary, will use anticipated proceeds of up to $476 million to help fund a $1.1 billion Midland Basin deal.
OMS Energy Files for IPO, Reports Revenue Growth
2024-11-06 - Singapore-based OMS Energy, a wellhead system manufacturer, has not yet determined its price range and number of shares.
SLB Earnings Rise, But Weakened 4Q and 2025 Ahead Due to Oil Glut
2024-10-22 - SLB, like Liberty Energy, revised guidance lower for the coming months, analysts said, as oilfield service companies grapple with concerns over an oversupplied global oil market.
After BKV’s IPO, Is Market Open to More Public SMID Caps?
2024-10-03 - The market for new E&P and energy IPOs has been tepid since the COVID-19 pandemic. But investor appetite is growing for new small- and mid-sized energy IPOs, says Citigroup Managing Director Dylan Tornay.