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Exploration & Development — Quick Takes
Total signs Utica shale JV with Chesapeake
Total E&P USA Inc. signed a joint venture agreement with Chesapeake Exploration LLC and affiliates of EnterVest Ltd. in which Total acquires a stake in the Utica shale in Ohio.
Terms call for Total to obtain a 25% share in the transaction signed Dec. 30 and effective as of Nov. 1, 2011. Total paid Chesapeake and EnerVest $700 million in cash.
In addition, Total agreed to pay up to $1.63 billion during 7 years in the form of a 60% carry of Chesapeake and EnerVest's future drilling and completion expenditures.
The Utica JV covers 619,000 net acres, of which 542,000 net acres are brought by Chesapeake and 77,000 net acres are brought by EnerVest. Total will acquire its 25% share from each of Chesapeake and EnerVest on identical terms, giving a total of 155,000 net acres.
Chesapeake will operate the acreage. Total also will acquire a 25% share in any new acreage that Chesapeake acquires in the Utica play.
As of yearend 2011, 13 wells had been drilled across the acreage. The joint venture plans to ramp up the drilling activities in the coming 3 years with 25 rigs planned by 2014.
Additionally, Total, Chesapeake, and EnerVest have agreed to jointly develop the construction of the necessary midstream assets to transport the production.
Total and Chesapeake already have a joint venture in the Barnett shale play.
BOEM completes draft EIS for lease sale program
The US Bureau of Ocean Energy Management completed a draft environmental impact statement regarding 10 oil and gas lease sales it has tentatively scheduled in the central and western Gulf of Mexico under the proposed 2012-17 US Outer Continental Shelf program. Five sales are planned for each of the two planning areas, BOEM indicated.
Comments will be accepted until Feb. 13, 2012, the US Department of the Interior agency said on Dec. 29. Public hearings on the draft EIS also will be held in Houston on Jan. 10, New Orleans on Jan. 11, and Mobile, Ala., on Jan. 12, it added.
BOEM said the draft multi-sale EIS provides information on baseline conditions and potential environmental effects of oil and gas leasing, exploration, development, and production in the central and western gulf.
The agency sought information pertinent to the lease sales, including consideration of the 2010 Macondo well accident and crude oil spill; surveys of scientific journals and credible scientific data from academic institutions and federal, state, and local government agencies; and interviews with personnel from those groups, it indicated.
It also examined potential impacts of routine activities and accidental events, including a possible low-probability, catastrophic event associated with the proposed lease sales, as well as the proposed sales' incremental contributions to cumulative environmental and socioeconomic resource impacts, according to BOEM.
Oil and gas resource estimates and scenario information for this draft, multi-sale EIS are presented as a range encompassing resources and activities available for the 10 proposed lease sales in the two planning areas, it said.
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