Under the terms of the agreement, Kodiak shareholders will receive .177 of a share of Whiting stock for each share of Kodiak common stock they hold, which is the equivalent of $13.90 based on the Whiting’s 11 July 2014 price.
The transaction is expected to create the largest Bakken/Three Forks producer with over 107,000 barrels of oil equivalent per day of production in the first quarter of 2014, 855,000 combined net acres and an inventory of 3,460 net future drilling locations, Whiting Petroleum said in a statement.
Whiting chairman, chief executive officer and president James Volker said, "The addition of Kodiak’s complementary acreage position and substantial inventory of high return drilling locations will provide the opportunity to drive significant value growth for both Whiting and Kodiak shareholders through an acceleration in drilling and increase in operational efficiencies."
"The combined company’s shareholders will also participate in Whiting’s 175,000 gross (123,000 net) acre, oil-rich Redtail-Niobrara prospect in the NE DJ Basin, where production is rapidly growing," Volker added.
"We expect the combined entity to have an initial enterprise value of $17.8 billion, total 2014 production of 152 thousand barrels of oil equivalent per day, and proved reserves of 606 million barrels of oil equivalent (80% oil), providing a leading platform for future oil-driven growth."
Lynn A. Peterson, Chairman, President and Chief Executive Officer of Kodiak said, "We expect the combined company to have increased operational and financial flexibility that will allow for accelerated and efficient development of the assets of both companies."
