Gulfport Buys Utica Interests for $302MM
Gulfport Energy on Thursday announced its agreement to acquire additional working interests in the Utica Shale.
Gulfport previously announced that on Dec. 17, 2012 it entered into a definitive agreement to purchase approximately 30,000 net acres in the Utica Shale in Eastern Ohio for approximately $302 million. The parties have now amended that agreement to provide for Gulfport's acquisition of approximately 7,000 additional net acres for approximately $70 million, resulting in a total acquisition price of approximately $372 million. The transaction, which will increase Gulfport's leasehold interests in the Utica Shale to approximately 137,000 gross (106,000 net) acres, excludes 14 existing wells, along with certain acreage surrounding each well. The proposed transaction is expected to close prior to year-end. Gulfport will continue to serve as operator of its acreage in the Utica Shale. The transaction was approved by a special committee of Gulfport's Board of Directors, which engaged independent financial advisors and counsel to assist with its review. Gulfport intends to fund this acquisition with a portion of the net proceeds from its common stock offering that priced on Dec. 18, 2012. That offering is expected to close on December 24, 2012, subject to customary closing conditions.
After giving effect to the Utica acquisition described above, Gulfport currently expects 2013 production to be in the range 7.60 million to 7.90 million BOE. Capital expenditures for exploration and production activities during 2013 are estimated to be in the range of $415 million to $425 million, excluding potential capital expenditures relating to Grizzly.
For 2013, Gulfport projects lease operating expense to be in the range of $5.00 to $6.00 per BOE, general and administrative expense to be between $1.50 and $2.50 per BOE, production taxes to be between eight percent and nine percent of revenues, and depreciation, depletion and amortization expense to be in the range of $33.00 to $35.00 per BOE.
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