"The closing of this transaction culminates more than a year's worth of focus and diligence from our team at XTO. As often highlighted, our proficiency in acquiring the right assets -- those with long-lived producing histories, strong margins and expansive upsides -- is the foundation for ongoing value creation for our shareholders," stated Bob R. Simpson, Chairman and Chief Executive Officer. "This watershed event sets the stage for years of continued profitable growth from the energy company that has always been a growth company."
"This acquisition offers the opportunity to apply our exploitation skills to high-quality properties which need capital and dedicated expertise," noted Steffen E. Palko, Vice Chairman and President. "We anticipate a smooth transition of operations into our districts and the immediate work agenda will entail field optimizations. With the Company's current production growth goal of 28% to 30% this year and 18% to 20% in 2005, we can patiently integrate new drilling inventory into our long-term plans for double-digit organic growth."
The closing price of $912 million includes adjustments for net revenues from the January 1, 2004 effective date, preferential purchase right elections and other typical closing effects. A deposit of $110 million was paid toward this purchase price in May 2004. Post-closing adjustments regarding outstanding preferential purchase rights, final net revenues, volume balancing and income tax effects will be made within twelve months. The purchase was funded through existing bank credit facilities and the sale of common stock in May 2004.
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