Pittsburgh, Pennsylvania-based CONSOL Energy, the leading energy producer in the Appalachian Basin, announced Thursday that it has entered into a joint venture with Noble Energy, a fellow energy development company focusing on both oil and gas, to develop CONSOL's 663,350 natural gas-rich Marcellus Shale acres in Pennsylvania and West Virginia for aggregate payments to CONSOL of approximately $3.4 billion. Under the agreement, Noble Energy will acquire 50 percent of CONSOL's Marcellus Shale interest including a 50 percent interest in CONSOL's existing Marcellus shale wells.
The joint development plan calls for the rig count to increase from four rigs currently drilling in the Marcellus to eight rigs in 2012 and 12 rigs in 2013, eventually reaching a plateau of 16 horizontal rigs in 2015. CONSOL will operate in the dry gas areas of the acreage, and after a transition period, Noble Energy will operate the wet gas acreage, comprising approximately 20 percent of the acreage.
The transaction is effective as of July 1, 2011, and is expected to close on September 30, 2011.