Exterra will acquire all of the independent producer’s interest in one of the oldest producing fields in Texas. The company will acquire both solid producing reserves and a large proven undeveloped reserve portfolio.
This project is of very low risk due to a diversification of the portfolio with a large current producing component, a large work-over potential, deepening potential as well as new drilling potential, the company said.
One recent engineering study estimated these proven reserves to be well over several million barrels of oil. The company expects to close this transaction by the end of its current fiscal year, which is May 31, 2010.
Todd Royal, CEO of Exterra, said: “This acquisition is the type of anchor project that Exterra has been looking to acquire for the past twelve months. It is anticipated that we will be able to use our current existing line of credit to close this acquisition.”
