NiSource Rises on Planned Utica Drilling Venture: Chicago Mover
NiSource Inc. (NI) rose after the company said it plans to form a venture to drill for oil or natural gas in the Utica shale basin.
The shares increased 2.8 percent to $25.33 at the close in New York.
NiSource, based in Merrillville, Indiana, expects to announce a partnership within a month that “could include significant downstream infrastructure investment opportunities,” Robert Skaggs Jr., president and chief executive officer, told analysts during a quarterly earnings conference call today.
Indiana’s largest gas utility owner, NiSource holds mineral rights to between 100,000 and 200,000 acres in the Utica that could support production, Mike Banas, a company spokesman, said in an e-mail today.
Nisource’s venture partner would handle exploration and production, while the gas distributor would gather and transport the fuel to be processed, Fishman said. NiSource didn’t say whether the partnership plans to drill for oil or gas, but said that it involves a region of eastern Ohio where shale rock formations primarily hold oil.
NiSource expects to contribute 15,000 acres to the venture with the balance provided by its as-yet unnamed partner, Skaggs said.
Skaggs said NiSource is scouting opportunities in the gas liquids-rich portion of the Utica, including proposals to provide gathering services. The company also unveiled plans to expand two pipelines to connect the Marcellus shale region in Pennsylvania with northeastern and Gulf Coast markets by late 2014.
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