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Seneca Resources not giving up Marcellus partnership September 8, 2011

Posted by mytruthaboutoil in Oil giants.
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Natural gas and oil company Seneca Resources Corp. said Thursday that it expects the production rate at its operations in the Marcellus Shale to reach 150 million cubic feet per day by Sept. 30, and 240 million cubic feet per day 12 months later.

Those dates coincide with the end of the National Fuel Gas unit’s fiscal 2011 and 2012.

The Marcellus Shale is rock containing a rich deposit of natural gas that extends through the Appalachian Basin.

“Our production rates will be ramping up substantially in the last quarter of this fiscal year as groups of new wells are brought on line,” said Matthew Cabell, Seneca’s president.

The production rate forecast is the same regardless of whether Seneca is working the Marcellus shale alone or takes on a partner, the company said.

Seneca has been in talks with potential partners in a joint venture to develop the Marcellus Shale, and has received several offers, the company said.

National Fuel Gas Co., an energy company based in Williamsville, N.Y., had anticipated reaching a decision on a partner by the end of last month, but it is still evaluating the offers, said David Smith, National Fuel’s chairman and CEO.

“While discussions are ongoing, as we’ve said in the past, we will only move forward with a transaction on terms that we believe add value to our shareholders over and above the value that Seneca will likely achieve through its currently planned operations,” he said.

Shares of National Fuel Gas Co. ended the regular session down $1.20 at $69.62.