Turned out to be a record after all.

The U.S. market witnessed $12.3 billion in joint venture announcements in 2011, topping the $10.6 billion in announced value for 2010.

To date, joint venture arrangements have totaled $36 billion between 2006 and year-end 2011. The year 2011 contributed one-third of the value among joint venture transactions that have announced dollar figures to date, while the last two years account for two-thirds of announced value in post 2006 deals.

The fourth quarter of 2011 produced the second highest dollar volume to date in joint ventures at $4.4 billion, just shy of the of the $4.6 billion recorded during the second quarter of 2010 when a flurry of joint ventures divvied up the Marcellus and Eagle Ford shales.

It is, therefore, hard to argue that the joint venture movement is winding down.

Indeed, 2012 began with a sizeable $2.2-billion joint venture between Sinopec and Devon Energy Corp. covering five U.S. shale basins, which brings the running total in U.S. JVs to $38.8 billion.

Do we hear $40?

It's likely within the next couple quarters since additional JVs are in the works in several basins, including the Barnett, Marcellus, and Niobrara shales, and in the Granite Wash and Mississippi Lime in the Midcontinent.

Take Me Home, Country Roads

Appalachia remains king of the JV movement with a 44% share of the dollar volume in deals with an announced value. The region accounts for $16.2 billion in announced joint ventures since 2006 with the focus on the Marcellus shale. In fact, the Marcellus shale has witnessed a joint venture announcement in 11 of the last 12 quarters, totaling $12.2 billion in aggregate. The Marcellus had a notable run during the third quarter as CONSOL executed a $3.4-billion arrangement with Noble Energy to develop Marcellus holdings in West Virginia and central Pennsylvania. However, the Utica shale carried Appalachian momentum during the second half of the year with $4.98 billion in announced transactions, including CONSOL/Hess and Chesapeake/Total.

Joint ventures will underwrite substantial drilling in Appalachia through 2015 based on the most recent deals. In all, drilling carries, at $10.9 billion, represent 68% of the value in Appalachian joint ventures. There have been a lot of rigs turning to the right during the last three years, thanks to joint ventures. There are going to be a lot of rigs turning to the right in Appalachia during the next three years, thanks to joint ventures.

The Eagle Ford is a distant second regionally with $7.1 billion in JVs since 2006 and no real movement since the first quarter of 2011 when Anadarko inked a $1.55-billion JV with Korea National Oil Company.

Otherwise the Haynesville shale is third regionally since 2006 with $4.8 billion in announced transactions—but no transactions since the second quarter 2009. Indeed, JV funding of drilling in the Haynesville may be winding down as acreage capture programs have been completed. Chesapeake Energy Corp., as an example, reduced its rig count in the Haynesville by 10 units in the fourth quarter of 2011 and transferred several of those rigs to the Eagle Ford shale, where the company is involved in a $2.16-billion JV with CNOOC.

Joint ventures were executed during 2011 in the Bakken shale and the Permian Basin, but dollar volumes were not announced for the transactions. Even so, those deals have not generated the volume of funding witnessed in Appalachia or the Eagle Ford.

A secondary headline for 2011 involves the diffusion of JVs into new basins. The Utica shale and the Mississippi Lime were new entrants to the JV arena in the second half of 2011. Together, both plays accounted for $4.98 billion in announced dollar value, or 40% of total value for 2011.

Deal structure in 2011 reflects overall trends in joint venture agreements with more than two-thirds of dollar volume to be supplied as drilling carries to the selling partner. That brought an $8.4-billion commitment to the drill bit during the next three years, though some deals have tied field expenditures to natural gas prices, which are currently low enough to postpone drilling plans in those arrangements.

European IOCs Lead Joint Venture Push

European majors still lead the way among joint venture participants. The trend was punctuated via Repsol's $1-billion arrangement with SandRidge Energy Corp. in the Mississippi Lime in December, and Total's $2.1-billion Utica shale venture with Chesapeake. In all, European majors account for $14.3 billion in announced transaction value for joint ventures, or 39% of JV dollar volume in the U.S. onshore market since 2006.

The Top Two buyers in the onshore JV movement are Total and Statoil, which have committed a combined $9.3 billion to U.S. shale development since 2008. Total has been an infrequent participant in the U.S. JV market. The firm is one of the few joint-venture investors in the Barnett shale through its $2.25-billion deal with Chesapeake on the second to last day of 2009. Total also entered a smaller JV with IDT Corp. in the first quarter 2009 to develop shale oil in Colorado.

Statoil remains the most aggressive European major in the U.S onshore sector outside of supermajors like Shell. In addition to $4.8 billion in JVs stretching from the Marcellus (with Chesapeake) to the Eagle Ford (with Talisman), Statoil also anted up $4.4 billion in the fourth quarter 2011 to acquire Bakken shale player Brigham Exploration Co. That brings Statoil's known investment in U.S. onshore properties to $9.3 billion. Clearly Statoil believes in the North American unconventional marketplace whether the target is dry gas in Appalachia or oil in the Bakken shale.

Chesapeake, CONSOL Lead JV Pack in 2011

Noble Energy Inc. topped all buyers in 2011 with a single $3.4-billion joint venture investment with CONSOL Energy to develop CONSOL's Marcellus properties in West Virginia and central Pennsylvania. Total's Utica shale joint venture with Chesapeake, at $2.14 billion, was second, with Repsol YPF SA a close third at $1.77 billion, including the SandRidge JV in the Mississippi Lime, and a $768-million JV with Armstrong Oil & Gas on the Alaskan North Slope.

When it comes to sellers in the joint venture movement, there is Chesapeake and there is everyone else. The Oklahoma City firm generated $4.6 billion in joint venture sales in 2011, bringing its total to date to $17.6 billion. That's a 48% share (not including the January 2012 Devon/Sinopec JV).

CONSOL was a close second behind Chesapeake in 2011 (and second overall since 2006) with $3.99 billion in joint venture arrangements with Noble Energy and Hess Corporation for its Marcellus/Utica holdings in Appalachia. Afterwards, totals drop quickly to $2.9 billion for Anadarko Petroleum Corp., including $1.55 billion in 2011 on the basis of the Eagle Ford JV with KNOC, followed by EXCO Resources at $2.25 billion. EXCO has not executed a joint venture since May 2010 when the company teamed up with British Gas in a $950-million Marcellus shale development effort.