US.Energy is an independent energy company focused on the acquisition and development of oil and gas producing properties in the United States
.S. Energy Corp. (NASDAQCM: USEG) (“U.S. Energy” or the “Company”) today announced that the Company (through a wholly-owned subsidiary) has entered into a Purchase and Sale Agreement (the “Transaction”) to acquire operated producing assets (the “Properties”) located in Liberty County, Texas in an all-stock transaction.
Proved Developed Reserves estimated at approximately 242,300 barrels of oil.
PV-10 estimated at $1.2 million at current strip pricing.
680 net acres in Liberty County, Texas all held by production.
Properties average a 100% working interest and 86% net revenue interest.
Purchase price $250,000 in U.S. Energy restricted common stock.
“We are very pleased to announce our most recent acquisition agreement, which represents U.S. Energy’s third acquisition of 2020 and shows the continued execution of our stated strategy of seeking to consolidate assets that represent mature, positive cash flowing properties,” said Ryan Smith, Chief Executive Officer of U.S. Energy, who continued, “The Properties are being purchased at highly accretive levels by any transactional metric and at a meaningful discount to their estimated existing reserve value while adding long lived oil reserves and immediate free cash flow to the U.S. Energy portfolio. We believe the current challenges facing the industry will continue to produce compelling asset consolidation opportunities and U.S. Energy will remain focused on pursuing accretive transactions that we can successfully roll into our existing asset base while maintaining our low cost corporate structure and clean balance sheet.”
As of October 1, 2020, the Properties had total estimated Proved Developed Reserves of approximately 242,300 barrels of oil, comprised entirely of Proved Developed Producing and Proved Developed Non-Producing reserves, and had a present value of estimated future net revenues before income taxes discounted at 10% (“PV10”) value of approximately $1.2 million. The Properties are operated with a 100% working interest and 86% net revenue interest. The Properties also contain 680 net acres which are 100% held by production. All assets are located in Liberty County, Texas.
The consideration payable for the assets is expected to be $250,000 in U.S. Energy restricted common stock. The Transaction is expected to close in the fourth quarter of 2020, subject to the satisfaction of customary closing conditions.
Source: Company Press Release