Seneca shops for Marcellus Shale JV partners

Source: Seneca Resources

Seneca Resources Corporation, a wholly owned subsidiary of National Fuel Gas Company (NYSE:NFG), continues to explore a joint venture as a vehicle to further accelerate the development of its Marcellus Shale acreage. Seneca has received offers from several possible joint venture partners and continues discussions about potential deal terms with a few of those parties. 

“In response to inquiries from our shareholders and industry analysts, we felt it was important to provide an update on our joint venture process,” said David F. Smith, Chairman and Chief Executive Officer of National Fuel. “While we had initially anticipated reaching a decision by the end of June, the varied, but not directly comparable, offers we have received have carried this process past this self-imposed deadline. While discussions are ongoing, as we’ve said in the past, we will only move forward with a transaction on terms that we believe add value to our shareholders over and above the value that Seneca will likely achieve through its currently planned operations. Seneca continues to experience outstanding operational results and significant production growth.” 

As the Company enters its fiscal fourth quarter, Seneca is providing an estimate of its likely Marcellus Shale production rate at the end of fiscal years 2011 and 2012. 

“Our production rates will be ramping up substantially in the last quarter of this fiscal year as groups of new wells are brought on line,” stated Matthew D. Cabell, President of Seneca. “We expect our net Marcellus production rate to reach 150 million cubic feet (“MMcf”) per day by September 30, 2011, and 240 MMcf per day by September 30, 2012, with or without a joint venture partner.”



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