If you try to create a formula on a "Long Text Area" field, salesforce does not support this.
One workaround is to create a new field and another workflow to perform a "field update" on this:
Step 1) Create a new field with data type of "Text Area (Long)"
Step 2) Create a workflow with the following settings:
Evaluation Criteria -> select "Every time a record is created or edited"
Rule Criteria -> select "Formula evaluates to true" and type "true"
Step 3) Select "Add Workflow Action" -> "New Field Update"
Step 4) Select the newly created field as the "Field To Update" and select "Use a formula to set the new value" under "Specify New Field Value"
Step 5) You can now enter in a formula that reference other "Long Text Area" fields. The results will be posted to the new field of type "Long Text Area".
Reasons Behind This Solution
Basically this allows complex logics, ie perform formula calculations on a long text field, to be offloaded to a workflow which runs on the background. As a normal formula needs to be calculated very often and can slow down the page on each load/save, shifting the calculations to workflow helps salesforce lower the CPU usage.