BIRMINGHAM, Ala. — Diversified Gas & Oil, a U.S.-based acquirer and operator of oil and gas producing assets, completed the acquisition of Appalachia Holding Company (Core) for approximately $183 million.
Diversified assumed ownership and operation of Core, which owns significant upstream and midstream assets across the company’s Appalachian footprint, further enhancing the economics of the company’s portfolio within the basin. The acquisition allows Diversified to consolidate operations to a single operator, creating significant value for the company.
“Acquiring Core allows us to unlock significant value from our growing base of assets in Kentucky and West Virginia that would otherwise not be achievable on a stand-alone basis,” said Rusty Hutson, CEO of Diversified. “Core’s assets are highly contiguous to the assets we acquired from EQT earlier this year and materially expand our midstream footprint in Southern Appalachia.”
The acquisition increases total production nearly 20 percent to approximately 71,000 barrels of oil equivalency per day and increases net working interest proved-developed-producing reserves by 25 percent to nearly 495 million barrels of oil equivalency. The assets include approximately 5,000 wells in Kentucky, West Virginia and Virginia, and significantly enlarge the company’s midstream footprint with the addition of approximately 4,100 miles of pipeline through West Virginia and Kentucky.
“We are pleased to expand our operations within the Appalachian Basin, and we welcome Core’s talented team of seasoned industry professionals to the Diversified family whose commitment and hard work underpin our success each day,” said Hutson.
Diversified completed its acquisition of Core on Oct, 11 and funded the purchase with a $130 million cash payment and 35 million newly issued ordinary shares. The acquisition is immediately accretive to cash flow, and expands Diversified’s proven business strategy, aligning with stated valuation and production goals.