Attached files
| file | filename |
|---|---|
| 8-K - CURRENT REPORT - Harvest Oil & Gas Corp. | v173456_8k.htm |
| EX-2.1 - PURCHASE AND SALE AGREEMENT - Harvest Oil & Gas Corp. | v173456_ex2-1.htm |
EV
Energy Partners to Acquire Appalachian Basin Oil and Gas Properties
HOUSTON,
Feb 8, 2010 (MARKETWIRE via COMTEX News Network) — EV Energy Partners, L.P.
(Nasdaq:EVEP) today announced it, along with certain institutional partnerships
managed by EnerVest, Ltd., has signed an agreement to acquire oil and natural
gas properties in the Appalachian Basin from Range Resources Corporation
(NYSE:RRC). EVEP will acquire a 46.15 percent interest in these assets for
$151.8 million.
The
acquisition, which has been approved by the Board of Directors, is expected to
close by the end of March 2010 and is subject to customary closing conditions
and purchase price adjustments.
The
acquisition is comprised of wells primarily producing from the Clinton and
Medina formations, with substantially all of the proved reserves and production
in Ohio. In addition, there is significant upside potential for
drilling in the Knox group formation, where EnerVest has extensive drilling
experience.
The
properties, and EVEP's share of reserves and production, include:
- 3,306
active wells (3,018 operated)
-
Estimated proved reserves as of Jan 1, 2010, net to EVEP, (based on recent strip
prices) of approximately 78.8 BCFE plus currently estimated probable and
possible reserves (most of which are possible), primarily in the Knox group
formation, of approximately 19.7 BCFE.
- 75
percent proved developed producing (58.7 BCFE)
- 70
percent natural gas and 30 percent crude oil
- Premium
natural gas pricing due to BTU content and location
- Current
daily production net to EVEP's interest of approximately 11.3 MMCFE
- 2010
Reserves-to-production ratio of 20 years (15 years for proved developed
producing)
-
Approximately 465,000 gross acres (193,000 net to EVEP’s interest), with over 90
percent held by production
- 388
currently identified proved undeveloped drilling locations, primarily in the
Clinton and Medina formations
-
Significant Knox group formation potential
John B.
Walker, Chairman and CEO, said, "This acquisition is our second in the
Appalachian Basin within the past six months. It provides EVEP with
additional long-life base production and development drilling opportunities in
an area where we have a sizeable asset position and substantial
experience. In addition, it provides us with a significant
opportunity for future production growth through drilling in the Knox group
formation, a play where EnerVest has had drilling success over the past six
years.”
For 2010
from the date of closing, EVEP expects the following for the properties to be
acquired:
|
Net
Daily Production:
|
||||
|
Natural
gas (Mcf)
|
7,300 - 7,900 | |||
|
Crude
oil (Bbls)
|
520 - 560 | |||
|
Total
(Mcfe)
|
10,420 - 11,260 | |||
|
Price
Differentials vs. NYMEX:
|
||||
|
Natural
gas (% of NYMEX Natural gas)
|
106% - 114 | % | ||
|
Crude
oil (% of NYMEX Crude Oil)
|
85% - 94 | % | ||
|
Lease
operating expenses ($/Mcfe)
|
$ | 1.30 - $1.45 | ||
|
Production
and other taxes (% revenues)
|
0.8% - 1.2 | % | ||
|
Incremental
monthly general & administrative expense ($thous)
|
80 - 110 | |||
In
conjunction with the acquisition, and consistent with its strategy of hedging a
significant percentage of its production, EVEP intends to enter into
arrangements to hedge a substantial portion of the acquired production volumes
at or prior to closing.
In
addition, since the Partnership’s third quarter 2009 earnings press release
dated November 9, 2009, EVEP has entered into the following additional commodity
price hedges for its existing production:
|
Swap
|
Swap
|
Collar
|
Collar
|
Collar
|
||||||||||||||||
|
Volume
|
Price
|
Volume
|
Floor
|
Ceiling
|
||||||||||||||||
|
Mmbtu
|
Mmbtu
|
|||||||||||||||||||
|
Natural
Gas:
|
||||||||||||||||||||
|
NYMEX
|
||||||||||||||||||||
|
1Q
2010
|
378,000 | $ | 5.710 | |||||||||||||||||
|
2Q
2010
|
291,200 | $ | 5.695 | |||||||||||||||||
|
3Q
2010
|
202,400 | $ | 5.860 | |||||||||||||||||
|
4Q
2010
|
110,400 | $ | 6.335 | |||||||||||||||||
|
2010
|
||||||||||||||||||||
|
Columbia
Appalachia
|
110,230 | $ | 5.745 | |||||||||||||||||
|
Dominion
Appalachia
|
393,470 | $ | 5.795 | |||||||||||||||||
|
2011
|
||||||||||||||||||||
|
NYMEX
|
440,555 | $ | 5.850 | $ | 7.550 | |||||||||||||||
|
Gas
Basis Differentials:
|
||||||||||||||||||||
|
2010
|
||||||||||||||||||||
|
El
Paso Permian
|
365,000 | $ | -0.275 | |||||||||||||||||
|
Panhandle
TX-OK
|
730,000 | $ | -0.300 | |||||||||||||||||
|
El
Paso San Juan
|
1,642,500 | $ | -0.340 | |||||||||||||||||
|
2011
|
||||||||||||||||||||
|
Dominion
Appalachia
|
346,020 | $ | 0.198 | |||||||||||||||||
|
Columbia
Appalachia
|
94,535 | $ | 0.150 | |||||||||||||||||
EV
Energy Partners, L.P., is a master limited partnership engaged in acquiring,
producing and developing oil and natural gas properties. More information about
EVEP is available on the internet at www.evenergypartners.com.
(code #:
EVEP/G)
This
press release may include "forward-looking statements" as defined by the
Securities and Exchange Commission. All statements, other than statements of
historical facts, included in this press release that address activities, events
or developments that the partnership expects, believes or anticipates will or
may occur in the future are forward-looking statements. These statements are
based on certain assumptions made by the partnership based on its experience and
perception of historical trends, current conditions, expected future
developments and other factors it believes are appropriate in the circumstances.
Such statements are subject to a number of assumptions, risks and uncertainties,
many of which are beyond the control of the partnership, which may cause our
actual results to differ materially from those implied or expressed by the
forward-looking statements. These include risks relating to financial
performance and results, availability of sufficient cash flow to pay
distributions and execute our business plan, prices and demand for natural gas
and oil, our ability to replace reserves and efficiently develop our current
reserves and other important factors that could cause actual results to differ
materially from those projected as described in the Company's reports filed with
the Securities and Exchange Commission available from us at www.evenergypartners.com
or from the Securities and Exchange Commission at www.sec.gov. In
filings with the SEC, we are required to report proved reserves as defined in
Regulation S-X under the Securities Act. In general, Regulation S-X
requires that in calculating proved reserves we use the unweighted average of
the price of crude oil and natural gas on the first day of each month for the
twelve months prior to the date of the report, without
escalation. The reserves described above in this press release were
calculated using forward strip prices. The estimated net proved
reserves attributable to the properties being acquired by the partnership using
the unweighted average prices for 2009 of $3.866 per MMBTU of natural gas and
$61.18 per barrel of crude oil as required by Regulation S-X are 73.5 BCFE, and
the estimated net probable and possible reserves (most of which are possible)
are 19.1 BCFE.
SOURCE:
EV Energy Partners, L.P.
EV Energy
Partners, L.P.
Michael
E. Mercer, 713-651-1144
Web site:
http://www.evenergypartners.com