By OGJ editors
HOUSTON, Nov. 4 -- Talisman Energy Inc., Calgary, acquired certain assets from several US companies to solidify its position in the Ordovician Trenton-Black River gas play fairway in the northern Appalachian basin, where it has had an exploration joint venture since early 2001.
Through its Fortuna Energy Inc. subsidiary, Talisman paid $58.6 million to acquire Trenton-Black River-related assets from Fairman Drilling Co. and FDC Venture 15 LP, DuBois, Pa., East Resources Inc., Wexford, Pa., and Abarta Oil & Gas Co., Pittsburgh.
The acquired interests include 23 bcf of proved gas reserves, 10 MMcfd of net gas production, and a large seismic database. Half the purchase price will be allocated towards land, seismic, and other assets, including tax pools.
Subject to certain preferential rights, Talisman will acquire 268,000 acres of land in New York State, most of it 100% working interest. Talisman has identified more than 30 development locations on the lands and plans to drill two exploration and four development wells in 2003.
The company plans to apply horizontal drilling, heretofore little used in the area, to boost net gas production to 15 MMcfd next year and to 30 MMcfd in 2005.
Dr. Jim Buckee, Talisman president and CEO, said, "We are excited by the addition of this acreage, which will provide us with high netback, low cost, gas production and prospects close to infrastructure and markets. We are developing a highly prospective acreage position in the region, with the potential to develop a new core area over the next few years."
The Trenton-Black River play in New York is similar to the Trenton oil play in Ontario, Canada, where Talisman is the largest oil and gas producer.
Talisman announced in January 2001 that it formed a 5-year exploration joint venture in the Appalachian basin with the Seneca Resources Corp. arm of National Fuel Gas Co. Nearly 1 million acres of Seneca land in western New York and northwestern Pennsylvania were dedicated to that program. The program targets hydrocarbons in Ordovician age formations at 6,500-11,000 ft. Seneca is based in Buffalo, NY.
The private Fairman companies are engaged in contract drilling and gas completion, production and pipeline operations. Fairman holds acreage in Pennsylvania, New York, and West Virginia. The firm dates to 1947.
Abarta Oil & Gas, part of Abarta Inc., was founded in 1978 and began acquiring oil and gas interests. It has grown to 40 employees in three offices and holds interests in 800 Appalachian gas and oil wells.