This article follows up our Part One on the companies in the Utica Shale.
Gulfport Energy (NASDAQ:GPOR)
Approximate Land Position: 57,500 net acres
Gulfport is a stock which we currently own. We like their mix of properties from developed assets which provide the cash to develop the portfolio to their oil sands properties in Canada. What intrigues us the most is the company’s exposure to the Utica. GPOR was a first mover in the area and has an attractive portfolio in the Utica and has land situated in the wet gas, retrograde condensate and oil windows which is where we all know the money is. Gulfport has already closed on 30,000 net acres, has another 27,500 under contract and could boost total net acreage up to 65,000 net acres if they are able to finalize deals on their current targets currently under negotiation.
Rex Energy (NASDAQ:REXX)
Approximate Land Position: 57,900 net acres
Rex Energy already has a nice size acreage holding for prospective Utica projects. Most of it is in the dry gas area of the play, however the company does have 11,000 net acres of land that composes their Warrior Prospect in the liquids area of the Ohio Utica. REXX is actively pursuing further acreage in the Utica, and it is our opinion that the company will increase their holdings within the wet gas and oil windows. According to the company’s presentations, investors can expect drilling to start in 2012.
Devon Energy (NYSE:DVN)
Approximate Land Position: 110,000 net acres
Devon Energy has kept their cards close to the vest on this play, but what we do know is that the company has 110,000 net acres within the plan, according to multiple reports. The company wants to increase their net acreage holdings by about 40,000 and will participate in approximately 4 wells in 2011 (both horizontal and vertical). Although we have not seen a map of the company’s project locations, the company has indicated, at their last conference, that they are in the oil part of the play (see the corporate presentation on their website - here).
Petroleum Development Corp. (PETD)
Approximate Land Position: 30,000 net acres
PETD recently acquired 30,000 net acres in Ohio’s Utica play at a cost of $50 million. This land is in the wet gas and oil windows, placing PETD in the highly desirable part of the play. The company is looking to add acreage (up to 80-100,000 net acres), and would look to add a JV partner if they are successful in this pursuit. The company has plans to drill one vertical well in Q4 of 2011 followed by two horizontal wells in 2012 with an option for two additional vertical wells in the same year. One important point for investors; 75% of the current land position is held by production.
Magnum Hunter Resources (NYSE:MHR)
Approximate Land Position: 16,000 net acres
Magnum Hunter has 20,000 acres with 16,000 net acres composing their Utica position. Magnum Hunter’s land is located in both Ohio (Monroe, Noble and Washington counties) and West Virginia (Tyler and Pleasants counties). Although not the most prospective acreage according to what we know, for Magnum Hunter this could add considerable upside to the company’s market cap should they have any luck in mimicking Chesapeake’s dry gas results.
Approximate Land Position: ?? net acres
We also know that both Anadarko (NYSE:APC) and ExxonMobil (NYSE:XOM) have positions in the Utica Shale. Exxon has reportedly been buying up leases in West Virginia and rumor has it that they are aiming to increase their Utica exposure in Ohio. Anadarko has been silent on their Utica holdings, however it was recently revealed that they obtained a drilling permit to test the Utica Shale in Ohio from that state’s regulator. These two companies currently have little information out about their total acreage or exactly where they are focusing their exploration efforts, however we expect it to slowly trickle out over the next few months.
Disclosure: I am long GPOR.