Plains Exploration & Production Co., Houston, (NYSE: PXP) plans to acquire all the interests in producing properties and midstream assets in Colorado from Denver-based Laramie Energy LLC for $900 million in cash and approximately $46 million in stock in a total deal valued at $946 million. The assets include more than 200 producing wells on 60,000 gross acres (55,000 net) and more than 3,000 additional poten- tial drilling locations in the Mesaverde section of the Piceance Basin. The assets also include a 25% interest in the Collbran Valley gathering system. Production is approximately 6,000 barrels of oil equivalent per day (97% gas). Proved reserves are approximately 64 million barrels equivalent and proved, probable and possible reserves are 359 million barrels. Plain chairman, president and chief executive James C. Flores says, “This transaction provides PXP a meaningful acreage position with substantial reserve- and production-growth opportunities. We have identified over 3,000 drilling locations each with an estimated ultimate recovery of nearly 1 billion cubic feet equivalent per well. With five drilling rigs operating, we expect to initially drill about 100 wells per year.” Plains will fund the deal with borrowings from its bank credit facility. Lehman Brothers Inc. is financial advisor to Plains, and Merrill Lynch Petrie Divestiture Advisors is financial advisor to Laramie. The transaction is expected to close during the second quarter.
Recommended Reading
Range Resources Holds Production Steady in 1Q 2024
2024-04-24 - NGLs are providing a boost for Range Resources as the company waits for natural gas demand to rebound.
Hess Midstream Increases Class A Distribution
2024-04-24 - Hess Midstream has increased its quarterly distribution per Class A share by approximately 45% since the first quarter of 2021.
Baker Hughes Awarded Saudi Pipeline Technology Contract
2024-04-23 - Baker Hughes will supply centrifugal compressors for Saudi Arabia’s new pipeline system, which aims to increase gas distribution across the kingdom and reduce carbon emissions
PrairieSky Adds $6.4MM in Mannville Royalty Interests, Reduces Debt
2024-04-23 - PrairieSky Royalty said the acquisition was funded with excess earnings from the CA$83 million (US$60.75 million) generated from operations.
Equitrans Midstream Announces Quarterly Dividends
2024-04-23 - Equitrans' dividends will be paid on May 15 to all applicable ETRN shareholders of record at the close of business on May 7.