American Energy Pays $4.3B for Shale Properties

HOUSTON (The Deal) -- As has been rumored, American Energy Partners, headed by deposed Chesapeake Energy (CHK) CEO Aubrey McClendon said Monday that its units bought properties in the Permian Basin, the Utica Shale and the Marcellus Shale from private equity-controlled companies for $4.25 billion.

American Energy-Permian Basin LLC bought 63,000 net acres of leasehold in the southern Permian primarily in Reagan and Irion Counties, Texas, from affiliates of Trilantic Capital Partners-backed Enduring Resources LLC of Denver for $2.5 billion. Separately, American Energy-Utica LLC picked up 27,000 net acres of leasehold in Monroe County, Ohio, from Kohlberg Kravis Roberts & Co.-backed East Resources Inc. and an unnamed private company and American Energy-Marcellus LLC purchased 48,000 net acres of leasehold in Doddridge, Harrison, Marion, Tyler and Wetzel Counties, W. Va., also from East Resources and an unnamed private company, for $1.75 billion.

Last month, Reuters reported that American Energy would buy Enduring for $2 billion. Shortly thereafter, the Deal reported from a source that American Energy was actually planning to announce $4.5 billion worth of property acquisitions, including some in the Marcellus Shale.

On Friday Upstreamonline.com reported that American Energy was working through a deal with HG Energy LLC, which was formed by former East Resources employees, to acquire the privately held company's package of 75,000 acres in the area for $2 billion, or $26,666 per acre.

The Permian properties have net production of 16,000 barrels of oil equivalent per day. The deal marks American Energy's entry into the play, where it intends to boost its position through additional acquisitions. Enduring is using four rigs to develop the Permian acreage and American Energy plans to boost operated drilling activity to six to eight rigs by the end of next year and drill up to 2,500 gross wells and 1,750 net wells on the acreage over the next 10 years.

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