Coal miner CONSOL Energy Inc. (CNX) has announced the sale of its nearly 7% royalty interest in some of Antero Resources Appalachian Corp’s Marcellus Shale assets to Antero for about $193 million in cash.
The royalty interest sold comprises nearly 115,647 net acres of Marcellus Shale located in nine counties in southwestern Pennsylvania and north central West Virginia. The company closed the transaction on September 21, 2011, with an effective date of July 1, 2011.
CONSOL Energy had acquired these royalty interests as part of the acquisition of the Appalachian oil and gas exploration and production business of Dominion Resources Inc. (D), which closed in April 2010.
CONSOL Energy said it will retain the existing shallow wells and formations and all other leasehold interests on the Marcellus Shale acreage, including geological formations generally above and below the Marcellus Shale.
CONSOL Energy also notified that the royalty related assets were excluded from the recent joint venture between CONSOL Energy and Noble Energy Inc. (NBL) to develop CONSOL’s Marcellus Shale properties in southwest Pennsylvania and northwest West Virginia. The joint venture formed in August 2011 excluded the royalty related assets so that the cash proceeds from the joint venture would accrue entirely to CONSOL Energy and its shareholders.
Based in Canonsburg, Pennsylvania, CONSOL Energy is a multi-fuel energy producer as well as energy services provider, primarily catering to the U.S. power producers. CONSOL Energy at present retains a Zacks #3 Rank, which translates into a short-term Hold rating. We maintain our long term Neutral rating on the stock.
