This article originally provided by The Charleston Gazette

February 3, 2011

Triana joins Marathon to drill up to 350 wells in Marcellus

By Eric Eyre

CHARLESTON, W.Va. -- Charleston-based Triana Energy and Marathon Oil have joined forces to drill up to 350 large-scale natural gas wells on 82,000 acres in northern West Virginia and southwestern Pennsylvania.

Under the agreement, Triana will drill four horizontal wells this year, and another 132 wells in the coming years -- all in the Marcellus Shale formation. Full development of the property could require 350 wells, Triana said.

"We have conducted an extensive geologic assessment of this area, and our evaluation is supported by the activity of our experienced operators," said Triana President Henry Harmon. "We believe this acreage holds exceptional opportunities for large-scale Marcellus Shale development."

The companies did not disclose the project's potential investment.

Thursday's transaction is the latest in a series of acquisitions and partnerships announced by Triana as the company moves toward becoming an industry leader for Marcellus drilling in Pennsylvania and West Virginia. Triana already has projects in Taylor and Lewis counties in West Virginia, and in Potter, Clearfield and McKean counties in Pennsylvania.

Triana said the partnership with Marathon "brings together two experienced operators and a set of high potential mineral assets." The two companies have formed a wholly owned subsidiary for the joint project. 

"We are delighted to join forces with an outstanding company like Marathon," Harmon said. "Our mutual commitment to environmental, health and safety stewardship is a key to the success of this joint venture."

Triana has about 50 employees. The company was founded in 2006 by executives of Triana Holdings, which owned and operated Columbia Natural Resources before its sale to Chesapeake Energy in 2005.

Four years later, Morgan Stanley Private Equity invested in Triana, allowing the company to expand its operations in the Marcellus Shale, a natural gas field that stretches from New York to West Virginia.

"We're very pleased with the progress that this latest acquisition represents toward our shared goal of building yet another successful energy company with the Triana team," said John Moon, Morgan Stanley's managing director.

Triana Energy is an independent, privately held oil and gas exploration and production company headquartered in Charleston. Marathon Oil, which is based in Houston, is the nation's fourth-largest oil company and fifth-largest refiner.

In Jan. 2010, Triana purchased 20,000 acres of mineral rights in Pennsylvania. The company plans to drill 100 wells on 27 drilling sites on the properties.

Natural gas production in West Virginia is expected to set a record next year -- mostly because of expanded drilling in the Marcellus formation

Between 2002 and 2008, West Virginia led the nation in the number of gas drilling permits issued. More than 2,800 permits were issued for new drilling in 45 of the state's 55 counties.

Last week, a West Virginia University study predicted that development of the Marcellus Shale could create more than 20,000 new jobs and pump billions of dollars into West Virginia's economy during the next few years.

Reach Eric Eyre at erice...@wvgazette.com or 304-348-4869.