Coal producer CONSOL Energy Inc. (CNX) announced that the federal government has approved its previously announced acquisition of Dominion Resources Inc.’s (D) Appalachian oil and gas exploration and production business, except for certain assets located in natural gas storage fields.
The Federal Trade Commission and the Antitrust Division of the Department of Justice have granted early termination of the waiting period under the Hart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976.
Given the signal to proceed by the federal government, the companies expect to close the deal by April 30, 2010.
CONSOL is moving ahead with its plans of expanding its gas business. In its effort, the company has entered into a $3.5 billion deal with Virginia-based Dominion and also announced a buyout of minority shareholders in CNX Gas Corp. (CXG).
The acquisition of Dominion assets is expected to substantially increase CONSOL’s natural gas reserves and production capacity, further enhancing its position as a leading diversified energy company with a balanced portfolio of coal and natural gas.
With this acquisition, CONSOL will increase its total proved gas reserves by more than 50% to roughly 3 trillion cubic feet and double its potential gas resource base to 41 trillion cubic feet. Furthermore, following the acquisition, the company expects its natural gas business to account for as much as 35% of its total revenue.
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