Halcon Buys Trumbull, Mercer Leases, Well Pad
YOUNGSTOWN, Ohio – Houston-based Halcon Resources Corp. has acquired Carrizo Oil and Gas's Utica shale leasehold positions in Trumbull County, Ohio, and Mercer and Crawford counties in Pennsylvania.
"We're running out of money to buy more acreage, so we decided to sell what’s in the north," said Richard Hunter, Carrizo spokesman. "We're really looking for acreage in the Guernsey, Belmont and Harrison county areas."
Carrizo did not identify the buyer, but the West Salem Township administration office in Mercer County confirmed that the Carizzo's road bond has been released and the township is working out a new one with Halcon.
The township office also confirmed that the Mercer County sites are now under lease with Halcon.
Carrizo announced Monday that it sold its 50% stake in 19,000 acres in Trumbull, Mercer and Crawford counties for $43 million. Included in these assets are a permitted drilling site in Hartford Township at the Bruglar farm in Trumbull County and three permitted sites in West Salem Township in Mercer County, Pa.
One of the sites in West Salem – just off State Line Road -- has a drill pad constructed there.
"The market for mineral leases has increased dramatically there," Hunter said, buoyed by stepped-up interest by energy giants such as BP, which holds a sizeable lease position in Trumbull County. "So, it was a good time to sell."
Carrizo and another partner want to concentrate on drilling opportunities in the southeast part of the state where results from wells there are much more promising than areas that remain unproven, Hunter said.
Gulfport Energy recently released peak production results from its Shugert 1-H well in Belmont County -- the best performing well in the Utica thus far.
Consol Energy Corp. of Pittsburgh has also pulled up stakes in Trumbull County. The company began work on a well pad at the Wollam Farm in Vienna earlier this year, but now wants to concentrate on other areas of the state that might hold better reserves. "We've re-prioritzed it within our mix," said Harry Schurr, general manager of Consol Energy's Utica operations. The Wollam site isn't fully reclaimed yet, but the well pad is now removed and Consol is taking a "wait and see" approach regarding the Vienna site, Schurr said.
In Mahoning County, Consol is in the process of drilling two wells at a site in North Jackson (READ STORY) and is preparing to hydraulically fracture its well in Ellsworth Township.
Consol reported Monday that it would post a loss for the third quarter because of mines that were idled and a conveyor belt malfunction that temporarily shut down coal mines the company operates in Greene County, Pa.
Meantime, Carrizo continues to hold 26,000 acres in lease agreements in this area, Hunter said. "We're trying to add to that."
According to an operational update dated Oct. 2, Halcon reported that it holds 130,000 net acres under contract or leased in Trumbull and Mahoning counties in Ohio, and in Pennsylvania, Mercer, Crawford and Venango counties.
Halcon said Oct. 2 that it plans to spud four to six wells this year and the first two are planned for this month. As of that reporting day, Halcon had five approved drilling permits and was in various stages of the permitting process for several more wells.
Halcon's first production results from its Utica wells are expected during the first quarter of 2013.
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