The Marcellus

In 2002, the US Geological Survey concluded that the exploitable gas resources in Pennsylvania amounted to only 2 tcf, and was too sparse to be profitable.  In 2005 a small independent company named Range Resources disagreed, and drilled a production well.  Two years later (2007), 3 wells were producing in this region. Many more (375) had permits for possible drilling.    At that time, a small independent oil and gas company, Marathon (size = 3.4% that of Exxon) contracted with Downey to study the basin. Based on a detailed study of the area, and his expertise in geophysics, engineering, and business, Downey recommended buying leases in the still relatively unknown “Marcellus”.  Based on these recommendation, Marathon leased 400 sq km, about 100,000 acres.  In addition to its fees, Downey (through the company he founded, Roxanna) obtained an ORRI (Over-Riding Royalty Interest) in all leases.  Subsequently partners were brought in. Triana (formerly Columbia Natural Gas).  Subsequently leasing costs went up 400x. Only in 2008 did the academic world and the large gas and oil companies become aware of the enormous value of this region.  Terry Englander (Penn State) announced to a shocked world that the Marcellus play included 500 tcf, 50 tcf of which he said was recoverable.  By 2013, about 5000 wells had been drilled, and the recoverable gas then estimated to be141 tcf.

Barnett Shale

In 2005, Downey and his team at Roxanna recognized the extension of the play into Johnson County prior to the area being highly explored. Roxanna purchased royalty interests in over 30,000 acres. The investment paid out in less than three years, and the area continues to hold some of the highest rate wells in the Barnett play.

In 2005, under contract to Shell, Marlan and Roxanna led the development of the Western Extension of the Barnett. Roxanna identified an opportunity to acquire over 55,000 acres in the western extension of the Barnett in an area previously thought to be sub-mature. Shell later sold its interest, and Roxanna holds overriding royalties in approximately 25 wells in this area.

Floyd/Neal Shale

The consulting organization that Downey founded, Roxanna Associates, developed a large play targeting the Floyd/Neal shale of Alabama and Mississippi for Shell. This shale was age-equivalent to the Barnett and thought to produce similar to the Barnett. Shell purchased over 30,000 acres in the play, and later sold its interest in the play for an undisclosed price.

Chainman Shale

Roxanna leased approximately 40,000 acres in the Chainman shale of Nevada in 2006 after identifying this shale as a potential gas shale resource play. Roxanna’s leases were one of the first leases acquired in the play, and targeted the thickest portion of the play. Roxanna purchased 10 year, 87.5% net revenue interest (NRI) leases and sold the leases to PetroHunt for cash and an ORRI on all existing and new leases acquired within a large area of mutual interest (AMI). PetroHunt has continued to lease and holds over 300,000 acres in the play. Numerous new leases were acquired within a large AMI. PetroHunt has continued to lease and holds over 300,000 acres in the play; they will be drilling this year the first significant wild cat on this acreage, purchased for the very low price of $40 per acre.

Woodford Shale Oil

Roxanna began searching for oil resource plays in 2009, and generated a play targeting the Woodford Shale in Oklahoma. The company picked up 3,500 acres in the play, and sold the play to Longfellow Energy, retaining a 10% WI and ORRI in a 150,000 acre AMI. Roxanna and Longfellow have jointly leased an additional 25,000 acres, they have drilled over 50 horizontal wells, and continue to run a three rig continuous drilling program.  In this area, the Mississippi Lime has recently become the exploration focus, and several wells have been permitted on this acreage. Numerous large operators have since become interested in the region, and obtained leases surrounding Roxanna’s position (at a significantly higher cost than was paid by Roxanna and Longfellow).

Meade Peak Shale

Roxanna identified this gas-rich source rock play in 2006, and partnered with Matador Resources to acquire over 140,000 acres at a cost of under $10 per acre. Bill Barrett Corp, Gary Williams Exploration and Fortuna (Talisman) later acquired large positions surrounding this acreage.

Eagle Ford

Downey’s early entry proposal into the Eagle Ford was rejected by the major oil and gas companies operating in Texas.  He then took the proposal to Matador, a small independent, to invest with EOG Resources in the early exploration.  Matador currently holds 60,000 acres, which were purchased at approximately $300 per acre.  Later Shell paid over $20,000 per acre in the Eagle Ford (and, ironically, not for the best acreage!).

New Albany Shale

The New Albany shale is an oil shale in the Illinois basin, still in the early exploration stage.  Roxanna for first entry paid between 50 and 100 dollars per acre for a 50,000-acre position; current prices exceed $1500 per acre.  Roxanna has drilled 3 vertical wells, and is awaiting clearance from the state to drill the first horizontal oil well in the state.


Roxanna is currently developing two new regions in the United States. As elsewhere, the approach is to go in early and cheap to obtain the plays that are most profitable.