Diversified Energy Company (DEC) has developed a business model aimed at acquiring and revitalising mature gas wells that still possess significant productive potential, estimated to last another 40-50 years. This model, which eschews drilling and fracking, has enabled DEC to become the largest owner of gas wells in the United States, surpassing even Exxon and Chevron, with over 70,000 wells in its portfolio.
Reese Energy Consulting reports that DEC, the largest conventional gas producer in Appalachia, expanded its operations two years ago into prolific areas such as Haynesville, Cotton Valley, Barnett, Anadarko, and Eagle Ford. These regions, rich in resources, have seen a shift in focus towards fracked wells due to the shale revolution. DEC, led by founder and CEO Rusty Hutson, has capitalised on this trend, acquiring traditional oil and gas wells that larger exploration and production companies have abandoned in favour of higher-yield operations.
Acquisitions are crucial to DEC’s strategy, ensuring a steady inventory of low-risk, low-cost, long-life assets. This approach has driven the company’s success, allowing it to maximise the extraction of hydrocarbons from these wells. Following its successful ventures in Appalachia and further south, DEC recently secured a conditional purchase and sales agreement with Crescent Pass Energy for $106 million in East Texas. This acquisition includes 170,000 acres, 827 wells, and a production capacity of 38 MMCFD, with an annual decline rate of 9%.
DEC’s innovative strategy continues to prove its worth in the competitive energy market, reaffirming its position as a leading player in the conventional gas sector.
Diversified Energy Company plc (LON:DEC) is an independent energy company engaged in the production, marketing, transportation and retirement of primarily natural gas and natural gas liquids related to its U.S. onshore upstream and midstream assets.
