Based on internal reservoir engineering estimates, CWEI believes that through these two transactions it has acquired approximately 187 Bcfe of proved reserves for $1.04 per Mcfe. Substantially all of Southwest's assets are located in the Permian Basin. The acquisitions were funded with a new financing package provided by Bank One N.A. and the Company has executed agreements for the sale of approximately $32 million of Common Stock in a private placement, which net of normal transaction costs will be used to partially repay debt. The common stock private placement will close on Tuesday, May 25th.
Clayton W. Williams Jr., President and CEO, commented, "We are very excited about this acquisition. It increases our reserves by 150%, doubles our reserve life and provides significant exploitation drilling opportunities."
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