PITTSBURGH—Newly public E&P Infinity Natural Resources sees opportunities to roll up additional Utica and Marcellus leasehold in Appalachia.
“We’re buying,” Infinity CEO Zack Arnold said Aug. 27 during Hart Energy’s DUG Appalachia Conference & Expo in Pittsburgh.
Infinity is a top producer in the Ohio Utica’s volatile oil window. The company also has Utica and Marcellus dry gas exposure in southwestern Pennsylvania.
Infinity is open to pursuing acquisitions ranging from small, tactical ground-game opportunities to larger, more strategic block-style packages.
“We would love to buy assets that come clear up the food chain—from what we’re doing in the millions of dollars in leasehold up to acquisitions of assets that could pierce $1 billion,” Arnold said.
Infinity, which closed an initial public offering earlier this year, produced an average of 33,100 boe/d in the second quarter (19% oil and 37% liquids).
The Utica play is gaining momentum in Appalachia after EOG’s $5.6. billion acquisition of Encino Energy this summer. The Encino acquisition adds 675,000 net core acres to EOG's Utica position for a combined 1.1 million net acres.
EOG’s pro forma production is estimated at 275,000 boe/d in the Utica after the Encino acquisition.
Experts anticipate continued M&A activity across the Utica’s volatile oil, wet gas and dry gas windows. While northeastern Pennsylvania is fairly locked up by large producers, leasehold in southwestern Appalachia is still relatively fragmented, said David Eudey, vice president of Northeast Appalachia for Expand Energy.
Top producers active in the Utica include Ascent Resources, Antero Resources and Gulfport Energy.
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Pushing west
A conference attendee suggested Infinity explore more distant areas of the Ohio Utica, including Tuscarawas County.
It’s an “interesting place” within the Ohio Utica, Arnold said. “It’s a little bit to the west of a lot of the development that’s occurred today.”
However, Infinity has established a strong track record of incorporating less prospective areas of the Utica into its drilling program.
“We've seen great success operating on wells and in areas that people would've believed to have been black oil and not the volatile oil—and not that long ago,” Arnold said.
He referenced Infinity’s Casper well pad brought online in Carroll County, Ohio—one of the company’s best pads ever developed.
“When we bought the position in Carroll County in 2021, people believed that acreage was probably not going to be viable,” he said. “We were sort of the furthest west that anybody had developed acreage.”
“So, I think [Tuscarawas County] has a lot of promise, and there’s a little bit of development occurring there.”