Penn Virginia Corporation
Radnor, Pennsylvania-based Penn Virginia Corporation (NYSE: PVA) is an independent oil and gas exploration and production compnay. The wholly-owned subsidiary, Penn Virginia Oil & Gas Corporation (PVOG), is its exploration arm. PVA owns a leasehold of 58,000 net acres prospective for Marcellus shale in northeastern Pennsylvania and has additional holdings in West Virginia.
In an October, 2008 PVA was reported to have been leasing land in Pennsylvania that was prospective for Marcellus shale. It had the intention of drilling there during 2009. As of that date, it had leased roughly 40,000 net acres mainly in Pennsylvania.
According to an August, 2008 report, PVA'a joint venture (JV) partner was Zone Oil & Gas. The JV project included 3-D seismic mapping and also drilling up to six wells in the Appalachian Basin. It covered PVA's 40,000 acres that were under lease in Fayette, Potter, Somerset, Tioga, and Westmoreland Counties in Pennsylvania.
A February, 2009 update provided by Penn Virginia indicated that the company had conducted 50 miles of 2-D seismic in northern Pennsylvania and planned to drill two Marcellus shale wells there by the end of 2009.
PVA also owned an extensive leasehold position in southcentral West Virginia including 8500 acres in Mason County and 30,000 in Boone County. During 2007, two horizontal wells had been drilled in Mason County targeting the Huron shale. One horizontal well targeting the Huron had been drilled in Boone County; a second, vertical one had been completed to both Marcellus and Huron shales. According to the aforementioned February, 2009 report, PVA opted to defer the capital cost of connecting up these West Virginia Huron wells to a gathering system.
A November, 2009 press release announced that Penn Virginia planned to relocate its divisional office from Kingsport, Tennessee to Pittsburgh, PA. According to the statement, this move was to be made for efficiency reasons in anticipation of growth in the company's Eastern Division related to Marcellus shale potential. The move was effective March 31, 2010.
According to a February, 2010 company update, PVA was in the process of drilling test wells in its northeastern Pennsylvania leasehold. It had also been acquiring new leases and had budgeted up to $48 million for doing so. In January, 2010 the company had drilled its first vertical Marcellus shale test well in Tioga County, PA. Completion of this well was to be determined based upon analysis of the Marcellus shale portion of the core. PVA planned to drill up to 6 test wells; 4 of these were to be horizontal. It had been successful bidder in a state lease sale acquiring 3,700 net acres in Potter County, PA.
A press release appeared in March, 2010 regarding a planned pipeline gathering system by a company formed by PVA, Penn Virginia Resource Partners LP (NYSE: PVR). The line was to handle Range Resource's production in Bradford, Lycoming, and Tioga counties. It was to have a capacity of 700 Mmcf/d and be built over a period of five years at a cost of $170 to $200 million.
A later March release mentioned that a division of the aforementioned PVR, Penn Virginia Resource Midstream (PVR Midstream), had entered into an agreement with a private company in Wyoming County, PA to build a gas gathering line and compression facility. It was to be a 12-inch gathering line and compression station with capacity of 25 Mmcf/d. The line was to become operational during the second quarter of 2010. It was to cost $6 to $7 million during 2010 with future extensions costing up to $10 million.
A late-May, 2010 news item stated that Penn Virginia had acquired an additional 10,000 acres primarily in Pennsylvania's Tioga, Potter, and Somerset counties. The acquisitions came in two transactions with a total cost of $19 million. The seller also retained a royalty interest to a portion of the property. The two transactions were:
- 7,900 net acres of Marcellus shale with deeper rights to an additional 23,000 net acres. The seller retained a 1.5% royalty interest. Penn Virginia's net revenue interest in the acreage amounted to 84%. The seller had been a private oil and gas firm and Penn Virginia partner.
- 2,100 acres from a second private oil and gas firm including rights to all formations including the Marcellus shale.
The acquisition brought PVA's total Marcellus leasehold to roughly 45,000 acres. The company planned to begin testing the new land during 2010, and also to continue building its Marcellus leasehold.
An August, 2010 company update mentioned that PVA continued to expand its Marcellus acreage, and, at the time of the report, stood at 58,000 net acres.
According to a November, 2010 news account PVA had been issued drilling permits for two deep wells in the Borough of Coudersport, the county seat of Potter County. The two horizontal wells were designated Northeast Timberlands A 1H and A 2H and located in the Niles Hill district. North of Coudersport in Allegany Township, the company had received permits to drill two wells on the Risser farm and a third one on the Dunn farm. PVA had also developed a significant leasehold on state forest land surrounding Coudersport including 3,640 acres in Eulalia and Roulette Twps. It had paid $13.9 million to lease this state forest acreage and paid 18% royalty.
- A. James Dearlove is Penn Virginia's President and CEO.
- Frank A. Pici is PVA Executive Vice President and CFO.
- H. Baird Whitehead is Executive Vice President and COO.
- William H. Shea, Jr.is CEO of Penn Virginia Resource Partners LP (PVR).