EV Energy Partners Eyes Utica Acquisitions
HOUSTON — EV Energy Partners plans to aggressively pursue acquisition opportunities in the Utica as the market rebounds.
“We will be as patient as necessary,” John Walker, executive chairman of EV Energy, told analysts this week during a conference call.
Walker said that there is great potential in tapping the volatile oil window of the Utica, which is located in the western edge of the play in areas such as Tuscarawas County.
He said that this section of the Utica could yield 30 million barrels of oil, but companies have found it difficult to extract that oil. One of the reasons, the company suspects, is that using water to hydraulically fracture these wells might damage the oil reservoir and therefore reduce production.
EV Energy and 10 other partners shared the cost to frack the Nettle well in Tuscarawas County, Walker said. The expermiental well was completed in December and fracked with a mixture of 75% liquid butane and 25% mineral oil.
“The initial results were encouraging,” Walker told analysts and media, comparing the results to Chesapeake Energy Corp.’s Parker well, also in Tuscarawas County. However, after 90 days production fell to about half of the Parker well, which produced 5,816 barrels of oil during the fourth quarter of 2014, according to the latest production report from ODNR.
“We will continue to determine the best completion efforts,” Walker said, noting the company plans to drill six more wells in the area.
EV is also moving forward on a joint venture agreement that would enable the company to drill on leasehold acreage in the wet-gas window of the play.
The company announced it would complete the sale of its stake in the UEO Buckeye midstream system by mid-July for $575 million. The money would be used to pay down its credit facility and position EV Energy to acquire additional acreage in the Utica as the market rebounds.
“We look forward to closing on the UEO sale, which will allow us to play offense again in what we expect to be an attractive acquisition market going forward,” Walker said.
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