How Terry built the fortune
Terry Pegula is a petroleum engineer who turned a small drilling business into one of the most successful early bets on the Marcellus Shale. He founded East Resources in 1983 with a few thousand dollars borrowed from family and friends and spent the next two decades drilling conventional gas wells in Pennsylvania, New York and neighbouring states, steadily building up acreage.
That acreage turned out to sit on top of one of the largest natural gas formations in the world. When horizontal drilling and hydraulic fracturing made the Marcellus Shale commercially attractive in the late 2000s, East Resources held a large and well positioned land position. In 2010 Pegula sold the company's Appalachian assets to Royal Dutch Shell for about 4.7 billion dollars. Because he had kept a large ownership share through the years, the sale turned him into one of the wealthiest people in American energy almost overnight.
Pegula did not leave the industry after the sale. He kept other oil and gas interests, including properties in the Rocky Mountain region, and continued to invest in energy, but his public profile shifted almost entirely toward professional sports.
The size of the Shell deal reflected how quickly the market for Appalachian gas acreage had changed. Only a few years earlier, much of the land East Resources held had been seen as marginal, suitable for modest shallow wells. Once operators showed that long horizontal wells could produce large volumes from the Marcellus, large energy companies competed to secure positions, and Pegula's patient accumulation of leases paid off at the top of that wave of interest.
Companies and holdings
Pegula's holdings now centre on sports and entertainment in western New York. With his wife Kim he owns Pegula Sports and Entertainment, which includes:
- the Buffalo Sabres of the National Hockey League, bought in 2011
- the Buffalo Bills of the National Football League, bought in 2014
- the Rochester Americans minor league hockey team
- arenas, a hotel and related businesses in downtown Buffalo
The Bills purchase, completed after the death of founding owner Ralph Wilson, was one of the highest prices ever paid for an NFL team at the time. A new stadium for the Bills in Orchard Park, funded partly by the Pegulas and partly by state and county money, is under construction to replace the old one. Pegula also backed East Resources Acquisition Company, a blank-check company listed in 2020.
Pegula Sports and Entertainment is run as an integrated group, with Kim Pegula long playing a senior executive role across the teams and related businesses. Their ownership has turned the family into one of the most influential private investors in Buffalo, where the downtown arena district and the new stadium are major civic projects.
Early life and career
Pegula was born in 1951 in Carbondale, Pennsylvania, a coal country town in the northeast of the state. His father worked in the mines. He studied petroleum and natural gas engineering at Penn State, graduating in 1973, and then worked as a drilling engineer before setting up his own company.
The early years of East Resources were lean, and Pegula has described doing much of the engineering and land work himself. The company grew by acquiring leases and wells that larger producers overlooked, a strategy that later left it with exactly the kind of acreage the shale boom rewarded. His long-term familiarity with Appalachian geology is often cited as the reason he was positioned to benefit when technology changed the economics of the region.
Philanthropy and public life
Pegula's best known gift went to his alma mater. In 2010 he pledged a large donation to Penn State to build an ice arena and to elevate the university's hockey program to the top level of college competition; Pegula Ice Arena opened in 2013, and the total gift later grew beyond the original pledge. He and Kim have also supported causes in Buffalo, including youth hockey and community programs, and have invested heavily in the redevelopment of the city's waterfront area around their arena.
As owner of two major league teams in a passionate sports city, Pegula is a highly visible public figure, though he gives relatively few interviews. His daughter Jessica Pegula is a professional tennis player, which has given the family additional public attention in recent years.