Big Oil Buys into Republican “Tax Free” Pennsylvania

Dow Jones News Wire

Chevron Corp. (CVX) has agreed to acquire independent natural-gas producer Atlas Energy Inc. (ATLS) and its liabilities for $4.3 billion, joining its larger rival Exxon Mobil Inc. (XOM) in making a bet on natural gas.

-By Matt Jarzemsky and Matt Day, Dow Jones Newswires; 212-416-2240;

Exxon’s acquisition of XTO nearly a year ago, some believe, has pressured Exxon’s stock because of a slump in natural-gas prices.

Chevron Vice Chairman George Kirkland said, however, “We are acquiring a company that has one of the premier acreage positions in the prolific Marcellus.”

The Marcellus shale, located in Appalachia and concentrated in parts of Pennsylvania, West Virginia and New York, is one of the hottest shale plays in the U.S. It’s helped contribute to the surge in North American natural-gas supplies and the resulting price weakness. Strong U.S. gas production has sent gas stockpiles to record levels, pressuring prices for much of the last two years. Natural gas futures on the New York Mercantile Exchange are trading at their lowest level for this time of year since 2002.

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