* To buy assets from a private company for $400 mln
* Deal to add 80,000 net acres in Marcellus
* Transaction to close by late February
* Shares up 3 percent in pre-market trade (Adds background, share movement)
Dec 21 - Ultra Petroleum Corp (UPL.N) said it would pay about $400 million to an unnamed private company to buy a stake in the burgeoning U.S. Marcellus Shale region, the latest oil and natural gas explorer to expand its footprint in the area.
Shares of the company were up 3 percent from Friday's close at $52.59 before the bell on Monday.
Ultra Petroleum's move follows U.S. energy giant Exxon Mobil's (XOM.N) bid to buy XTO Energy (XTO.N) and Range Resources Corp's (RRC.N) completion of the third phase of its natural gas processing infrastructure expansion program at the Marcellus Shale last week.
The Marcellus Shale, located in parts of Pennsylvania, New York and West Virginia, is said to contain enough natural gas trapped in rock to meet domestic needs for a decade or more.
However, drilling there has drawn ire from residents of northeastern Pennsylvania who accuse the natural-gas drilling companies of contaminating water wells with toxic chemicals used in hydraulic fracturing.
In November, Cabot Oil & Gas Corp (COG.N) was accused of violating state environmental laws by allowing drilling chemicals to escape from gas wells. [ID:nN20227173]
On Thursday, Exxon Mobil said it could pull out of its $30 billion acquisition of XTO Energy if U.S lawmakers passed legislation on a controversial drilling technique used to tap oil and gas fields. [ID:nSGE5BG05Q]
On the other hand, the demand for gas, which burns much cleaner than either oil or coal, is expected to increase steadily worldwide as nations struggle to control emissions that contribute to pollution. [ID:nN16179072]
Ultra Petroleum will hold about 250,000 net acres in Marcellus following Monday's acquisition of 80,000 net acres, with the potential for 1,800 net drilling locations.
With this acquisition, we believe that our net recovered resource in the Marcellus alone will exceed 8.5 trillion cubic feet equivalent (Tcfe), an increase of 3.5 Tcfe from current estimates, Chief Executive Michael Watford said in a statement.
U.S. natural gas reserves are up by a third since 2006, thanks to increases in unconventional gas development.
Ultra Petroleum said it expects the deal to close by late February. (Reporting by Arundhati Ramanathan in Bangalore, Editing by Dinesh Nair)