US oil and gas company Dune Energy has signed an agreement to acquire a portfolio of privately owned oil and gas yielding properties in North Texas for $56 million.
Dune has signed a definitive Asset Purchase and Sale Agreement with Voyager Partners to acquire its 95% interest in producing and non-producing natural gas and oil properties located in the Barnett Shale play in the North Texas Fort Worth Basin.
The purchase price for the transaction is $56 million, subject to reduction in certain instances. The acquisition is scheduled to be completed on or before June 30, 2005.
Dune is in the process of completing its financing for the acquisition, which will include Standard Bank lending up to $50 million with the remainder of the purchase price and funding for a drilling program to be raised through Dune’s issuance of a combination of subordinated debt and equity.
It is estimated by Dune that there is in excess of 100 drilling locations on the Barnett Shale Properties. A reserve report as of December 31, 2004 indicated that there are approximately 27 Bcfe of net proved reserves underlying the properties. Furthermore, Voyager is expected to add as much as an additional 18 Bcfe in proved reserves to the assets being acquired, bringing the total to 45 Bcfe.
Dune expects to commence an aggressive, high impact, low risk extensional drilling program upon closing, whereby it is anticipated that it will drill 12 vertical wells by year-end 2005, 24 vertical wells during 2006, and numerous horizontal wells commencing late 2005.