DOVER -- Red Hill Development announces that it has entered into a joint venture with American Energy-Utica, LLC ("AEU") for the development of a portion of Red Hill's Utica Shale acreage located in Eastern Guernsey and Western Harrison County.
Red Hill Development was founded in 1975 by the Kimble family of Dover with various family members playing key roles in management of the company over the years. Red Hill continues to be operated by the Kimble family today producing aver 600 shallow and deep wells on its leaseholds located primarily in Tuscarowas, Coshocton, Harrison, and Guernsey counties of Ohio.
American Energy-Utica, LLC is an affiliate of American Energy Partners, LP, which is a private campany formed by former Chesopeoke Energy CEO Aubrey McClendon. McClendon recently mode headlines relative to his raising in excess of $1.6 billion dollars to fund Utica Shale development.
"The joint venture will enhance our ability to fully and expeditiously develop our acreage in Harrison and Guernsey Counties while we continue to explore opportunities for development of our additional holdings in the region," said Keith B. Kimble, manager of RHDK Oil & Gas, LLC dba Red Hill Development. "We've spent a great deal of time and energy studying the Utica Shale and the best available technologies to use in order to effectively develop the Utica. We have a lot of history drilling through the Utica and know it can be challenging and will require
tremendous amount of capital.
The family has explored all options so that we could provide the best opportunity for expeditious, safe and productive development of our leases."
Red Hill Development spent the last few years working with various banks and private equity groups to finance drilling operations, and negotiating with midstream companies for transportation and processing options.
According to Kimble, "After all of our due diligence the best fit for rapid, safe and productive development was a joint venture relationship.
Aubrey's ability to raise money for development, and his experience in horizontal drilling in general and the Utica Shale in particular, were a perfect fit for Red Hill Development."
The AEU-Red Hill Joint Venture plans to begin immediately applying for Utica well permits and commencing construction on well sites as early as October of this year, with the first well to be spud before the end of 2013.
Plans for additional drilling activity are being developed for 2014 through 2016.
As a co-venturer, Red Hill Development will maintain a significant ownership position in its Utica leaseholds included in the Joint Venture, and will be involved in future investment and drilling operations alongside AEU.