Total enters Utica shale deposit

Jan. 3, 2012 at 7:39 AM   |   0 comments

OKLAHOMA CITY, Jan. 3 (UPI) -- French supermajor Total announced it was expanding its portfolio of unconventional gas plays through a joint venture in the Utica shale deposit in Ohio.

Total's U.S. subsidiary announced it took a 25 percent stake in Utica shale natural gas assets held by Chesapeake Exploration and its partner EnerVest Ltd.

Total Exploration and Production President Yves-Louis Darricarrere said the acquisition is part of an effort to expand the presence in unconventional gas plays.

"This is consistent with our strategy to develop positions in unconventional plays with large potential and, in this case, with value predominantly linked to oil price," he said in a statement.

The French company described the Ohio shale deposit as "very promising" acreage. There have been more than a dozen wells dug in the Utica shale play with 24 rigs planned for mobilization by 2014.

Shale gas exploration is controversial because the natural gas extraction process, known as hydraulic fracturing, is viewed as harmful to the environment. The U.S. Environmental Protection Agency last month found traces of hydraulic fracturing fluid in water wells in Wyoming, although it said the amounts were less than those considered unsafe.

Darricarrere said Total was conscious of its environmental obligations.

Chesapeake put the total combined value of the transaction at $2.32 billion.

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