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Gulfport Energy buys up more of Utica Shale

OKLAHOMA CITY (AP) -- Gulfport Energy Corp. is adding to its property in the Utica Shale, which is believed to hold enormous reserves of natural gas and oil.

The oil and gas producer said Monday that it will buy about 22,000 acres in the Utica Shale in eastern Ohio for about $220 million from Windsor Ohio, an affiliate of investment firm Wexford Capital. It's paying for the deal with help from a stock offering of 7.8 million shares, also launched Monday.

In December Gulfport acquired 37,000 acres from Windsor Ohio. The new deal, expected to close before the end of the month, would bring Gulfport's interest in the Utica Shale to about 128,000 acres.

The Utica lies beneath the Marcellus Shale, where energy companies have drilled thousands of unconventional gas wells in recent years. The Marcellus is considered to be one of the richest natural gas reserves in the world. Drillers are just beginning to tap into the deeper Utica.

Gulfport estimated that it would produce 21,370 to 22,192 barrels of oil equivalent per day, including the acquisition, this year.

Gulfport, which is based in Oklahoma City, focuses on energy properties along Louisiana's Gulf of Mexico coast. It has also acquired property in Colorado as well as the Utica.

Shares of Gulfport fell $1.22, or 3 percent, to $40.07 in premarket trading. A company's stock will often decline on plans to sell stock, because that weakens the value of existing shareholders' stakes.

The banks managing the Gulfport stock offering may buy another 1.2 million shares in the deal. If all 8.9 million shares are sold, it could increase the company's stock outstanding by 13 percent.