Chesapeake & Range Resources Peg Value of Their Marcellus Shale Holdings from $36K – $56K per Acre

Date: April 11, 2011

Range Resources CEO John Pinkerton said that their holdings in the Marcellus Shale play are worth more than four times the $14,000 per acre that recent deals between energy companies have brought. Chesapeake Energy CEO Aubrey McClendon says his company\’s Marcellus Shale holdings are worth $35,900 per acre to the company. With 1.57 million acres leased, that\’s an astonishing $53 billion worth of value for Chesapeake!

If those values are true—and not just hype for investors—that would make the recent deals between Reliance and Atlas Energy ($14,167/acre) and Misui and Anadarko Petroleum ($14,000/acre) real bargains.

MDN Note: These prices are not the prices energy companies pay landowners to lease land. Lease prices are more in the range of $5,000 per acre recently. Rather, this is the value energy companies say an average acre of Marcellus Shale land will eventually supply in revenue to the company. Not all land is productive, so the number is an average across all leased acreage.

*Tulsa World/Bloomberg News (Apr 14) – Marcellus Shale assets considered valuable

 

Joe Price
Attorney Joe Price is a seasoned Trial Lawyer serving Northeast, Central and Southeast Pennsylvania for the past forty (40) years. He has handled serious personal injury cases in courts throughout the Federal system including New Jersey and New York. Attorney Price is A.V. Rated by Martindale Hubble. He is Board Certified in Civil Practice by the National Board of Trial Advocacy since 1996.