Mitsui joins Anadarko on Marcellus Shale for $1.4B

Anadarko Petroleum Corporation (APC) today announced a joint-venture agreement with Mitsui E&P USA LLC, an affiliate of Mitsui & Co., Ltd. (MITSY), whereby Mitsui will participate with Anadarko as a 32.5-percent partner in Anadarko's Marcellus Shale assets, primarily located in north-central Pennsylvania, for approximately $1.4 billion. 

Mitsui will earn approximately 100,000 net acres in exchange for funding 100 percent of Anadarko's share of development costs in 2010, and 90 percent of these costs thereafter, with an estimated completion of all obligations by 2013. In addition, Mitsui will have the opportunity to purchase a 32.5-percent share of Anadarko's existing wells and additional acreage acquisitions by reimbursing a proportionate share of Anadarko's prior expenditures, currently estimated to be approximately $100 million. 

"This transaction reflects the significant value of Anadarko's fairway position in the Marcellus Shale, which has a gross unrisked resource potential of more than 30 Tcf (trillion cubic feet) of natural gas and spans more than 715,000 gross acres,"Anadarko Chairman and CEO Jim Hackett said. "We continue to ramp up our activities in the Marcellus and anticipate drilling more than 4,500 wells over the coming years."

The joint-venture agreement is effective Jan. 1, 2010. Closing of the transaction is subject to applicable regulatory approvals and other contractual conditions, and is anticipated on March 15, 2010.



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