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Thursday, June 6, 2013

Investigation Discovers That Chesapeake Quietly Unloaded 1,100 Columbiana County Leases This Year

From Business Journal Daily:
Documents obtained from the Columbiana County recorder’s office show that Chesapeake has assigned nearly 1,100 leases in six townships to Hilcorp Energy Co., a competitor that is accelerating exploration and production in southern Mahoning County, western Pennsylvania and northern Columbiana County. 
“It would fit with their [Hilcorp’s] strategy of developing southern Mahoning County and northern Columbiana County,” observes Alan Wenger, an attorney at Harrington, Hoppe & Mitchell, where he heads the firm’s oil and gas division. “We received lots of calls, and a number of them were from fairly sizeable landowners.” 
Wenger says many clients were concerned about the transfer since few were familiar with Hilcorp. “I assured them that they were a good company,” he said, “and it quieted down after that.” 
A bulk assignment that included 1,097 leases in Salem, Elk Run, Fairfield, Unity, Center and Middleton townships in the northeastern section of the county was negotiated Jan. 23 between Hilcorp and Chesapeake, and the transaction was notarized Feb. 15.
Read the whole report here.

It's an odd thing that there was no announcement of this deal, since most of Chesapeake's asset sales have been accompanied by a press release.  Perhaps it was another deal that Chesapeake lost a lot of money on and they didn't really want to publicize it?  There's really no way to know at this point, but it is interesting that all of these leases in one of the areas that Chesapeake has publicly identified as a focal point of their Utica shale activity are now Hilcorp's.


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