EOG Resources to acquire Encino-related gas and oil wells in Ohio
CARROLLTON − EOG Resources, a Houston-based energy company, has announced plans to acquire Encino Acquisition Partners and increase its Utica acreage to 1.1 million.
Encino Acquisition Partners, a joint venture of the Canada Pension Plan Investment Board (CPP Investments) and Houston-based Encino Energy, owns 675,000 acres in the Utica Shale, including oil and natural gas wells in Stark, Columbiana and Carroll counties.
It also has leases to operate in public lands, such as Valley Run Wildlife Area in Carroll County, Zepernick Wildlife Area in Columbiana County, Leesville Wildlife Area in Carroll County.
Encino previously had an office in Louisville that came with the purchase of Chesapeake Energy’s assets in 2018. During the pandemic, the company sold the five-story office building at 2321 Energy Drive and moved to a smaller regional office in the Carrollton area.
“When we established Encino Acquisition Partners with Encino Energy in 2017, we envisioned creating a company that would be a leader in acquiring U.S. oil and gas assets,” Bill Rogers, head of sustainable energies at CPP Investments, said in a prepared statement. “Since then, it has done just that, and we are pleased with EAP’s success and the strong returns this investment has delivered.”
A spokesman for the pension board declined to comment further.
“It is our understanding that the sale has not been finalized at this time,” Karina Cheung, ODNR spokesperson said in a statement.
Who is EOG Resources?
The investment board has 98% ownership of Encino Acquisition Partners. It and Encino Energy will fully exit the partnership for a full sale to EOG Resources.
The $5.6 billion transaction, which includes Encino’s debt, is expected to close in the second half of this year. EOG Resources will fund the acquisition with $2.1 billion of cash on hand and $3.5 billion of debt.
“This acquisition combines large, premier acreage positions in the Utica, creating a third foundational play for EOG alongside our Delaware Basin and Eagle Ford assets,” Ezra Y. Yacob, the company’s chairman and CEO, said in a prepared statement.
“Encino’s acreage improves the quality and depth of our Utica position, expanding EOG’s multi-basin portfolio to more than 12 billion barrels of oil equivalent net resource.”
Yacob added that the acquisition will “enhance the returns of our business and create long-term value for our shareholders.” The acquisition is expected to boost free cash flow and result in a 5% increase to its quarterly dividend.
Encino Energy describes itself as the largest oil producer and the second-largest natural gas producer in Ohio. EOG Resources calls itself one of the largest crude oil and natural gas exploration and production companies in the nation.
EOG Resources also has a lease agreement with the state to frack in the Keen Wildlife Area in Harrison County. It was unclear whether Encino’s agreements to frack in wildlife areas would automatically transfer to EOG Resources, and the Ohio Department of Natural Resources did not immediately have an answer.
Fracking, short for hydraulic fracturing, is a drilling process where water, sand and chemicals are injected into a well to fracture rock and extract natural gas and oil.
Fracking in Ohio’s parks
Cathy Becker, board president of Save Ohio Parks, said the practice turns fresh water resources into toxic waste and comes with the risk of fires, hazardous spills and other detrimental effects for people and wildlife. Earlier this month, ODNR told Encino Energy to halt operations in Noble County after an abnormal number of earthquakes occurred in the area.
“You put this right next to a park, and it’s not a matter of if but when that is going to happen,” Becker said.
“In Noble County, the company halted hydraulic fracturing operations on the wells at the Bears pad,” Cheung said in her statement.
Becker noted that Encino has started fracking at Valley Run and obtains water from Atwood Lake. Last year, the Muskingum Watershed Conservancy District limited water withdrawals for the oil and gas industry amid drought conditions.
Save Ohio Parks, which was formed in 2023 to oppose fracking on public lands, coordinated an online petition that collected more than 1,300 signatures in opposition to the Canadian pension board’s investment in fracking. The group’s request to meet with the board in September 2024 received no response.
Becker said the organization hasn’t engaged with EOG Resources yet but expects to, although she thinks the only thing that will change is the company they’re dealing with.
“It’s just very concerning to see all our freshwater resources used in this way for this industry, and especially to frack our parks and wildlife areas that we believe should be protected,” she said.
Calls seeking additional comments from EOG Resources’ media representative were not returned.
Reach Kelly at 330-580-8323 or kelly.byer@cantonrep.com
