ZaZa Energy Corp. (NASDAQ: ZAZA) and an affiliate of private-equity firm Quantum Energy Partners entered a purchase and sale agreement regarding acreage in East Texas, the company said Aug. 27.
The purchase and sale agreement includes a development agreement for Grimes, Houston, Madison, Trinity and Walker counties, ZaZa added.
ZaZa will receive about $17 million, in total consideration, of cash and the right to receive Quantum’s interest in the next 15 joint venture (JV) wells in the area, the company said.
Zaza assigned Quantum 6,000 net acres in undeveloped leases in the area, but the company holds its working interest in existing wells and also holds the right to participate in the 15 JV reserved wells, the company added.
The agreement gives ZaZa a total of about 30,000 net acres in the East Texas JV area and about 10,000 net acres in its area of focus in East Texas, the company said.
Quantum will provide ZaZa with general and administrative and cost reimbursements, the company noted.
“We are delighted to partner with Quantum, a world-class private-equity firm with an outstanding track record of investing in entrepreneurial management teams like ours. ZaZa has been meeting with Quantum for more than a year to lay the groundwork for this new relationship,” said Todd Brooks, ZaZa’s president and CEO.
“Throughout that time, Quantum has watched as ZaZa advanced its East Texas drilling program. Our new partnership validates the progress ZaZa has made, and we look forward to working with Quantum as we move forward with our East Texas acquisition and development plans,” he added.
Houston-based ZaZa Energy Corp. explores and produces domestic unconventional oil and natural gas.
Quantum Energy Partners is also based in Houston.
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