(Alliance News) - Diversified Energy Co PLC on Wednesday said it has bought the well services and plugging assets and operations of Contractor Services Inc for an undisclosed amount.
The Alabama, US-based gas & oil production company said ConServ, which is a Appalachian plugging and well services provider located in West Virginia, represents its third acquisition of an Appalachian asset retirement operator during 2022.
Diversified Energy said ConServ will enhance its ability to retire more wells, scale the business up to drive further efficiencies, and provide additional third-party revenue to offset the company's own well retirement costs.
As part of the acquisition, Diversified noted that it will add the ConServ well services and plugging division to its existing Next LVL Energy asset retirement platform. Its plugging programme now includes 15 well plugging rigs, up 70% from the first quarter of 2022.
ConServ also adds three derrick rigs to Diversified's portfolio, which will help supplement the servicing and retiring of both deep vertical and unconventional wells.
"The acquisition significantly enhances the visibility by which Diversified will meet its stated commitment to retire at least 200 wells per year across the company's Appalachian footprint, well in excess of state minimum plugging requirements and with locally based internal equipment and crews," the company added.
Shares in Diversified were up 0.9% to 117.50 pence each in London on Wednesday morning.
By Sophie Rose; sophierose@alliancenews.com
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Diversified Energy (DEC)