Diversified Gas & Oil closes $575m acquisition of EQT’s assets in US

Diversified Gas & Oil has completed the $575m acquisition of producing gas and oil and midstream assets in the southern Appalachian Basin in the US from EQT.

Announced last month, the deal will increase the company’s production by more than two times to over 60,000 barrels of oil equivalent a day, strengthening its position in the Appalachian region.

The acquired assets include EQT’s gas and oil assets across Kentucky, Virginia and West Virginia, totalling more than 11,000 wells.

Diversified will also acquire more than 6,400 miles of gathering pipe and 59 compressor stations, which improves the economics of its production.

The transaction also involves more than 250 employees joining the company from EQT.

Diversified Gas & Oil CEO Rusty Hutson said: “The addition of these high-quality assets to our growing portfolio and their accretive impact on earnings are tangible results that benefit our shareholders, and represents a significant milestone in the evolution of our clearly stated strategy.

“Completing a transaction of this size further increases Diversified’s visibility in the market as a preferred and capable purchaser of oil and gas assets.”

“We now turn our attention to the optimisation and integration of these assets into our expanding operations.”

The assets have current net total gas production of 32.1Mboe/day and the addition will enable the company to enhance its net daily production by 114%.

In order to fund the transaction, Diversified extended its existing credit facility and completed capital raise of $250m.