Oh My Sweet Atlas

At the Master Limited Partnership Investor Conference in NY this morning, Atlas President & COO, Richard Weber, discussed the "Sweet Spot" position his company has in the Marcellus shale in southwestern Pennsylvania. The fundamental reason is that the shale in the area is characterized by a very desirable .6 pressure gradient which is providing the verticals that they've completed with the strongest recovery numbers in the entire play. He also noted that coincident with that "overpressure" is a greater degree of natural fracturing. Atlas, a long time area producer with 242,000 acres in the four county area is also very much in the sweet spot by having acquired those leases well before anyone had even heard the name Marcellus (and even a few print jocks in the area still can't spell it). With 60 verticals under their belt, Weber said their experience gives them a very good understanding of the acreage and clearly delineates their position. Add it all up and you get 4-6 Tcfe of proven, recoverable reserves.

Tactically speaking, Weber reiterated from the last conference call that the 1600 miles of 8" & 12" gathering systems they have built over the last several years are exactly the type one would build for a Marcellus program. They are scalable and tied in to a 6.5 Bcfd Texas Eastern line which runs through the heart of the region.

Is Weber alone in his thinking? I hadn't heard this before but he also said that over the last few weeks, they've met with Tennessee, National Fuel, Dominion, and Equitable; all of whom want to build more high pressure transmission capacity in the area.

Full Audio at http://phx.corporate-ir.net/phoenix.zhtml?c=202140&p=irol-EventDetails&EventId=1857002