Consol acquires drilling rights from Dominion
Consol Energy Inc. will pay $190 million to Dominion Resources Inc. for drilling rights on land in West Virginia, the companies announced on Tuesday.
Dominion will let Consol drill on 90,000 acres it controls for storage fields in Lewis and Harrison counties. Consol said the deal could produce about 350 drilling spots, and about half of the land probably will have wet gas, meaning it contains other hydrocarbons such as ethane and propane that often fetch a higher price than natural gas.
Consol has acquired large tracts of drilling rights in the past year — including at Pittsburgh International Airport and Ryerson Station State Park — as it ramps up drilling operations. It sold five West Virginia coal mines last week to help it raise money to support a shift from coal mining to gas drilling.
“This transaction reinforces Consol Energy's commitment to being a leading natural-gas producer in the Appalachian Basin,” Chairman and CEO J. Brett Harvey said in a statement announcing the deal. “These parcels represent what could be the largest untapped contiguous acreage in the southern core of the Marcellus shale.”
Dominion, which sold Consol 500,000 acres for $3.5 billion in March 2010, got a commitment from Consol to be the anchor shipper on Dominion's transmission pipeline system as part of the deal. Dominion announced that it has commitments to ship 500,000 dekatherms per day of natural gas westward from West Virginia, half of which will come from the agreement with Consol.
In the next year, there is likely to be an increasing amount of gas shipped from the Marcellus shale westward, Robert W. Baird & Co. Inc. advised investors in notes about the deal.
Timothy Puko is a Trib Total Media staff writer. Reach him at 412-320-7991 or firstname.lastname@example.org.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- CMU showcases its lengthy list of fledgling companies at venture event
- Miata leaves cutesy behind for sleek
- Uncle Charley’s Sausage expands sales to Maryland, Virginia
- Stocks wrap best week of year with slight gains
- Credit bureau Experian keeps info on cellular firm’s customers
- ZeroFossil Energy Outfitters powers up with renewable sources
- Last-minute China worries derailed Fed’s rate hike plans, minutes reveal
- Rice, Gulfport team on Utica shale pipeline system
- Sluggish wage growth may sap retail spending during winter holidays
- Other segments nudge Alcoa to slim profit
- Bear sharpens claws on ‘old Pittsburgh’