Chevron to Buy Atlas Energy in $4.3 Billion Deal

Nov. 10, 2010
Acquisition further advances company's global shale gas position, complementing its recent entrance into shale gas in Poland, Romania and Canada

Chevron Corp. said on Nov. 10 that it would buy natural-gas producer Atlas Energy to expand the company's footprint in shale gas. Chevron will $3.2 billion in cash and would assume the company's debt of about $1.1 billion.

"The Atlas Energy assets further advance Chevron's global shale gas position, complementing the company's recent entrance into shale gas opportunities in Poland, Romania and Canada," said George Kirkland, Chevron's vice chairman.

Under the agreed takeover, Chevron will pay Atlas Energy shareholders $43.34 in cash for each share, a 37% premium over the closing price on Nov. 8.

Kirkland said the acquisition of the Pennsylvania-based company will provide Chevron with an attractive natural gas resource position primarily located in the state's Marcellus Shale. "We are acquiring a company that has one of the premier acreage positions in the prolific Marcellus," Kirkland said.

"The high quality resource, competitive cost structure in the Marcellus, strong growth potential of the asset base and its proximity to premier natural gas markets make this targeted acquisition a compelling investment for Chevron."

If the deal is approved by regulators, the San Ramon, California-based energy giant will gain Atlas Energy's estimated nine trillion cubic feet of natural gas resources, which includes approximately 850 billion cubic feet of proved natural gas reserves with approximately 80 million cubic feet of daily natural gas production.

Atlas Energy is one of the largest independent natural gas producers in the Appalachian and Michigan basins and a leading developer in the Marcellus Shale position in Pennsylvania.

Its assets in the Appalachian basin consist of 486,000 net acres of Marcellus Shale; 623,000 net acres of Utica Shale; and a 49% interest in Laurel Mountain Midstream, a joint venture which owns over 1,000 miles of intrastate and natural gas gathering lines servicing the Marcellus, among other resources.

Copyright Agence France-Presse, 2010

Popular Sponsored Recommendations

Decarbonization Navigator: A Toolkit for Organizations

Sept. 28, 2023
The increasing urgency of addressing climate change along with stakeholder pressures are driving the need for organizations to prioritize decarbonization. Discover how to start...

How Manufacturers Can Optimize Operations with Weather Intelligence

Nov. 2, 2023
The bad news? Severe weather has emerged as one of the biggest threats to continuity and safety in manufacturing. The good news? The intelligence solutions that build weather ...

Discover How an Eye Tracking Study Improves Training Procedures

Oct. 29, 2023
Did you know that your training processes can be streamlined by visualizing and analyzing key skills within your employee base? Find out how we use eye tracking to capture advanced...

Food and Beverage 2024 Trends and Outlook for North America

Oct. 29, 2023
Ready to hear what 200 of your peers said are the top challenges and opportunities in 2024? Don’t fall behind. Uncover actionable insights to better prepare for 2024 in this whitepaper...

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!