Rice Energy announces Marcellus deal

Appalachian player Rice Energy announced late on Thursday a purchase and sale agreement to take over Vantage Energy in a deal valued at USD 2.7 billion, including debt.

The agreement will see Rice Energy acquire 344 square kilometres across the Marcellus Dry Gas Core in Pennsylvania, as well as the rights to acreage in the deeper Utica Shale and the Barnett Shale, totalling 210 and 150 square kilometres, respectively. The company will end up controlling some 935 square kilometres across the Marcellus and Ohio Utica cores upon the conclusion of the transaction.

As part of the purchase and sale agreement, Rice Energy’s midstream unit, Rice Midstream Partners, will take over the midstream assets its parent company bought from Vantage Energy in a connected deal for USD 600 million.

“This deal represents the largest core dry gas Marcellus acquisition to date, one that is truly transformational for Rice Energy, Rice Midstream Partners and our respective shareholders,” CEO Daniel J. Rice said in a statement. His counterpart at Vantage Energy, Roger Biemans, said, “We believe the combination of Rice and Vantage creates the premier natural gas company in the country. Rice will have a multi-decade inventory of the most economic dry gas in North America, a tremendous growth story for its midstream business, and a management team that has proven its ability to execute on its strategy.”