Chevron acquires 228,000 net Marcellus Shale acres in southwest Pennsylvania from Chief Oil & Gas and Tug Hill Report

Deal Insight 04 May 2011

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Report summary

Chevron has announced the acquisition of 228,000 net acres in the Marcellus Shale from Chief Oil & Gas, and Tug Hill. For Chevron, the deal is all about building on the position it gained through the February 2010 acquisition of Atlas Energy. The Chief acreage, located in southwest Pennsylvania, is contiguous with the Atlas portfolio, and adds a further 5 tcf of gas to Chevron's long-term resource base.The parties did not disclose the consideration, but analysis of comparable ...

Executive summary
Upstream assets
Deal analysis
- Wood Mackenzie valuation
- Metric based implied transaction cost
Upsides and risks
Strategic rationale
- Chevron
- Chief
Oil & gas pricing and assumptions

Tables and charts

This report includes 8 images and tables including:

Chief acreage in southwest PA
Wood Mackenzie NPV sensitivities under drilling upside scenarios of Plus 25% and Plus 50%
Upsides and risks: Table 1

Oil & gas pricing and assumptions: Table 1
Oil & gas pricing and assumptions: Table 2
1) Wood Mackenzie NPV estimates and 2) Comparable transaction metric based implied cost
Deal analysis: Table 1
Deal analysis: Table 2