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Rady, Warren’s Appalachia-Focused Antero IPO Set To Price Thursday

New public, oily Athlon Energy’s shares have soared; gassier Jones Energy’s stock has pushed through initial softness.

Paul Rady and Glen Warren are set to price their IPO of some 30 million shares Thursday evening of their Marcellus- and Utica-focused Antero Resources Corp. The pricing is expected to be at between $38 and $42 a share, raising some $1.2 billion.

The fund-raise is toward paying bank debt and further surfacing the company’s roughly 26.1 trillion cubic feet equivalent (Tcfe) of gas, gas-liquids and oil reserves. Proved reserves are some 4.9 Tcfe, 21% proved developed and 75% natural gas. First-quarter 2013 production averaged 383 million cubic feet equivalent per day. It also owns and operates gathering pipelines and four gas-compression stations. Assets are $4.8 billion; liabilities, $3.1 billion.

Rady, who is chairman and chief executive, and Warren, president and chief financial officer, founded the Denver-based shale player in 2002 after selling their three-year-old Pennaco Energy Inc.’s gassy Rockies-focused portfolio to Marathon Oil Corp. for $500 million in cash in 2001. In 2005, they sold their then-two-year-old Antero’s Barnett-shale holdings for more than $1 billion in cash and stock to XTO Energy Inc., now a business unit of ExxonMobil Corp.

Currently, Antero holds some 317,000 net acres in the Marcellus play and some 94,000 net that are prospective for production from the Utica. “In addition, we estimate that approximately 194,000 net acres of our Marcellus-shale leasehold are prospective for the slightly shallower, upper-Devonian shale,” the company reported in its S-1.

Shares are to begin trading Friday morning on the NYSE as AR.

Update: Athlon Energy Had Them At “Wolfcamp”

Shares of newly public, oily Athlon Energy Inc. (NYSE: ATHL) bolted in their first day of trading Aug. 2 to $27.56, opening at $26, after pricing the evening before at $20. The Permian Basin-focused E&P had gotten a pre-pricing lift during the week by Energen Corp.’s news that a Reeves County, Texas, well, E.J. Brady 56-1 1H, came on with 1,798 barrels of oil equivalent, 27% oil, from the upper portion of the Wolfcamp formation. Also, it reported, a well in Winkler County came on with 1,000 equivalent, 74% oil; in Ward County, one with 1,200 equivalent, 61% oil; in Glasscock County, one with 861 equivalent, 60% oil.

Also that week, Pioneer Natural Resources Co. reported a Midland County well in Wolfcamp B came on with 1,700 barrels equivalent, 74% oil. Another, the six-month-old DL Hutt C 1H, had already made 140,000 barrels equivalent, it added. In a trial of the Wolfcamp’s A bench, its DL Hutt C 2H came on with 1,712 barrels equivalent, also 74% oil, from a roughly 7,400-foot lateral with 30 frac stages.

With an overallotment upon over-subscription of the Athlon shares, 15.8 million were sold. Oil was about $107 at the time. The shares were $31.97 at the close Friday; oil, about $104.

Founded in August 2010 by Bob Reeves and other former leaders at Encore Acquisition Co., the company has some 86 million barrels equivalent of proved reserves, 58% oil, entirely in the Permian Basin.

Update: Jones Energy Pushes Through Soft Start

Jonny Jones and the team at Anadarko- and Arkoma-focused Jones Energy Inc. (NYSE: JONE) raised some $188 million on July 23 in its pricing of 12.5 million IPO shares. A gassier E&P, the shares were $16.32 at the close Friday after trading below pricing in the first six weeks of trading.

Jones, who is CEO, founded the Austin, Texas-based company in 1988. It currently has some 85 million barrels equivalent of proved reserves—roughly 55% oil and gas liquids—and interest in 720 wells, producing 15,800 barrels equivalent a day net to Jones from Cleveland, Granite Wash, Tonkawa, Marmaton and Woodford.

–Nissa Darbonne, Editor-at-Large, Oil and Gas Investor, OilandGasInvestor.com, Oil and Gas Investor This Week, A&D Watch, A-Dcenter.comUGcenter.com. Contact Nissa at ndarbonne@hartenergy.com.


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