Posted by: Lawyer Sanders | July 22, 2008

BP to pay $1.75 billion for 90,000 acres of natural gas and shale in Oklahoma.

BP America Inc. agreed to acquire all of Chesapeake Energy Corp.’s interests in 90,000 net acres of leasehold and producing natural gas properties in the Arkoma basin Woodford shale play for $1.75 billion.  The properties are in the Oklahoma counties of Atoka, Coal, Hughes, and Pittsburg. They currently produce 50 MMcfd of gas equivalent. The deal is expected to close on August 8, 2008.

The Woodford Shale (Lower Mississippian-Upper Devonian) has emerged as one of the most significant resource plays to develop in Oklahoma. The play area encompasses more than 1200 square miles, and lies within a 4 county area in eastern to southeastern Oklahoma. The play is defined to the west by the gas maturity level, and to east by the regional complexity of the Choctaw Thrust System. The Woodford Shale, as it is regionally termed, is an organic-rich mudstone by definition, consisting of predominantly silica and illite, with minor amounts of pyrite, and dolomite.


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