By Angela Chen
American Energy Partners, led by Aubrey McClendon, reported that
its Utica and Marcellus affiliates will merge in an all-stock
transaction to create one of the largest pure-play Appalachian
exploration-and-production companies in the country.
After the merger, shareholders will own all of the common equity
of the new company, called American Energy Appalachia Holdings LLC.
The two companies will remain wholly-owned units of American Energy
Appalachia.
American Energy Appalachia will operate over 300,000 acres in
the Utica and Marcellus Shale plays in eastern Ohio and northern
West Virginia, respectively. American Energy Appalachia had
reserves of 1.5 trillion cubic feet and estimated daily production
of 167 million cubic feet for the most recently ended quarter.
American Energy Partners was created by Mr. McClendon in 2013
after he was ousted as chief executive of Chesapeake Energy Corp.
Ohio's Utica Shale has been a key point for the company. Last year,
it purchased Utica shale fields from Hess Corp., in its first
acquisition, for $924 million.
The move Monday by American Energy Partners comes as oil prices
hit multiyear lows amid a glut in supply, prompted in part by big
bets on shale-rock formation in the U.S., a resource that became
economically feasible to tap with the advent of new drilling
technology.
Write to Angela Chen at angela.chen@dowjones.com
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