Thailand-linked BKV raises US natural gas holdings with takeover of ExxonMobil’s Barnett Shale assets

Monday, 23 May 2022
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BKV Corp., a privately-held exploration and production company formed out of Thailand-based Banpu Public Company, has grown into one of the largest US shale-gas producers and has now purchased the Barnett Shale gas assets of US major ExxonMobil for $750 million.

The company has been investing in shale since the US business was launched in 2015 and already has shale-gas assets in the Barnett Shale of north Texas as well as in the Marcellus Shale in Pennsylvania.

BKV, based in Denver, Colorado, said it signed definitive purchase and sale agreements to acquire the Barnett natural gas upstream and associated midstream infrastructure owned by ExxonMobil subsidiary XTO Energy.

BKV is acquiring 160,000 total net acres primarily in Tarrant, Johnson and Parker counties, and additional smaller positions in Jack, Wise, Denton, Erath, Hood and Ellis counties.

“These upstream assets include low decline wells, ideal for delivering consistent cash flow, and high average working interests of approximately 93 percent in over 2,100 wells with operatorship positions,” said a statement on the takeover.

The transaction also includes about 750 miles of gas-gathering pipelines and compression and processing midstream infrastructure.

BKV has been steadily buying up natural gas assets in recent years, primarily in the Barnett Shale.

Mitchell link

Devon Energy sold its Barnett properties to BKV in 2020. Devon had developed its Barnett assets after itself taking over Mitchell Energy & Development Corp. of US shale pioneer George P. Mitchell.

BKV recently reported gross natural gas production of 550,000 thousand cubic feet per day from the Barnett and in the Marcellus Shale it holds 50,000 gross acres.

The Denver company said that in addition to the $750M payment the transaction had other contingent payments depending on future natural gas prices and was expected to close by the end of June.

“Our focus as a company is to drive value through continued expansion in the Barnett play,” said Chris Kalnin, BKV Chief Executive.

“Today, BKV is a leading natural gas operator in the United States with an integrated approach to the value chain that allows us to certify our responsibly sourced gas at the well head,” explained Kalnin.

“We are excited about the extensive synergies this transaction presents, as well as additional access to premier Gulf Coast markets,” he added.

“We look forward to building upon the strengths of XTO Energy and its team to drive future growth,” declared Kalnin.

BKV’s Thai roots are reflected in the board of directors. In addition to CEO Kalnin, the board includes Chanin Vongkusolkit as Chairman and the other board members are Akaraphong Dayananda, Anon Sirisaengtaksin, Somruedee Chaimongkol, Thiti Mekavichai, Charles Miller III and Joe Davis.

BKV said that Baker Botts LLP and Fox Rothschild acted as advisors for the company in XTO Energy transaction.

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