In the first transaction in the Gulf of Mexico since the oil spill in April and the subsequent drilling moratorium, Matt McCarroll’s Dynamic Offshore Resources LLC, Houston, has acquired properties on the Gulf shelf from privately held Samson Investment Co., Tulsa, Okla., for an undisclosed price.
The assets include 22,000 net acres in 16 federal and state blocks involving eight fields, the most prominent being a 100% interest in Vermillion Block 272 and a 50% interest in High Island Block 52. Current net production from the properties is approximately 4,500 BOE per day (60% oil). Dynamic will operate more than 67% of the acquired reserves.
The acquisition includes 32 active wells, 36 inactive wells, six platforms and two caissons in 30 to 175 feet of water.
The assets were marketed by BMO Capital Markets and included 27 federal and state blocks and 38,248 net acres (61% held by production; 74% operated). Total proved reserves in the divestment package were 6 million BOE (3.18 million barrels of oil; 16.8 million cu. ft. of gas), with 6.9 million bbl. equivalent proved, probable and possible. Net average cash flow for fourth-quarter 2009 was $7 million per month.
The divestment represented a complete exit of the region for Samson.
Dynamic Offshore was formed in January 2008 with a $450-million equity contribution from Riverstone Holdings LLC. In October, Dynamic acquired Gulf of Mexico-focused Beryl Oil and Gas LP, Houston.
Taqa North Ltd., a subsidiary of UAE-based Abu Dhabi National Energy Co. PJSC, or Taqa, will purchase certain noncore gas properties from Canadian E&P company Suncor Energy Inc., Calgary, (NYSE, Toronto: SU) for C$285 million.
The acquisition includes the Bearberry and Ricinus assets in west-central Alberta, and production of approximately 6,100 BOE per day.
The liquids-rich interests are near Taqa’s existing core area in west-central Alberta.
Suncor is continuing to divest certain noncore assets and has so far reached agreements totaling approximately $2.4 billion. Announced sales include oil and gas interests in the Rockies, in Western Canada, in The Netherlands and in Trinidad and Tobago.
The deal is expected to close during third-quarter 2010.
Patterson-UTI Energy (Nasdaq: PTEN) plans to acquire the pressure-pumping and electric wireline businesses of Key Energy Services Inc., Houston, for approximately $256.7 million in cash, expanding its pressure-pumping presence in the Barnett shale, Eagle Ford shale and Permian Basin and bringing its associated horsepower to 419,500.
The acquired pressure-pumping equipment consists of 214,400 horsepower, including 184,400 of fracturing horsepower and 30,000 horsepower used in cementing, acidizing and nitrogen stimulation. The acquired wireline business includes 26 wireline units that operate in the same areas as the acquired pressure-pumping assets, including the Bakken and Marcellus shales.
Key will retain its remaining production services businesses, including its coiled tubing operations—a primary focus area of the company’s well-intervention growth strategy.
The deal is expected to close by September. Patterson-UTI will pay $237.7 million at closing. Additionally, Patterson-UTI has entered an additional credit agreement with a borrowing base of up to $250 million to fund the acquisition through October 30. Key anticipates recording a pre-tax gain of approximately $160 million.
Tudor, Pickering, Holt & Co. Securities is advisor to Key.
Unable to secure funds for the previously announced deal, Denver-based Opon International LLC has terminated discussions with independent E&P company Delta Petroleum Corp., Denver, (Nasdaq: DPTR) to acquire a 37.5% nonoperated working interest in assets in Colorado’s Piceance Basin for $400 million.
The transaction involved a joint-venture agreement to develop Delta’s operated Vega area assets. Delta had planned to apply $225 million of the consideration toward the Vega development, debt and general purposes. The company had also agreed to issue to Opon warrants to purchase 13.3 million shares of Delta common stock at $1.50 per share and 5.7 million shares at $3.50 per share.
Delta intends to continue the development of its primary asset in the Piceance Basin to bolster its proved reserves and will also pursue alternatives to enhance shareholder value.
Morgan Stanley and Evercore Partners were financial advisors to Delta. Davis Graham & Stubbs LLP was legal advisor. Deutsche Bank Securities Inc. was financial advisor to Opon and Hogan & Hartson LLP was legal advisor.
Houston MLP Linn Energy LLC (Nasdaq: LINE) is adding to its Permian Basin position targeting the Wolfberry trend with a $90-million acquisition from an undisclosed seller.
The assets include some 950 BOE per day and proved reserves of 7 million BOE (78% oil). The assets have a reserve life of 19 years and the acquisition involves more than 50 proved infill drilling locations.
Linn plans to finance the deal with cash flow and its revolving credit facility. It is expected to close by Aug. 16.
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