Endeavour International Corporation has entered into purchase and sale agreements with SM Energy Company and certain other minority owners to acquire the leasehold and producing interests held by SM Energy and its partners in the Marcellus shale in north central Pennsylvania, as well as a pipeline and related facilities for aggregate consideration of $110 million. The transaction provides Endeavour with significant production and reserve potential on acreage that is adjacent to the Company's existing Marcellus acreage and is readily available for development in one of the most economically attractive shale gas plays in the United States.
The assets include the following:
Approximately 50,000 net acres of leasehold with 100 percent operated working interests in McKean and Potter counties;
"This acquisition represents a significant step forward in the growth of our domestic onshore business in a play that offers some of the highest returns in the United States today," said William L. Transier, chairman, chief executive officer and president. "The acreage is located on trend with several major industry developments and complements our existing acreage position in Cameron County immediately to the south. Our development model indicates recoverable natural gas potential from 1.0 to 1.3 trillion cubic feet with more than 300 identified drilling locations on our McKean and Cameron County leasehold. As operator of these assets, including the gathering infrastructure, we have the opportunity to accelerate our development plans in an effort to realize the value of our investment while expanding our position in this three county area."
Operational and Financial Update
The Rowan Gorilla VII rig has arrived at the Bacchus field and has commenced drilling operations for the three planned development wells. The Bacchus development is located in the Central UK North Sea and Endeavour has a 30% working interest in the field.
Senior Term Loan
In support of the Company's growth plans, Cyan Partners and certain lenders under the Senior Term Loan have amended the terms of the Company's Senior Term Loan and agreed to expand the facility by $75 million. Endeavour intends to use this additional capital to accelerate its development activities throughout the Company, particularly its Greater Rochelle development and its expanded position in Pennsylvania following the Marcellus acquisition.
Most Popular Articles
From the Career Center
Jobs that may interest you