Stone Energy Makes Acquisition in Williston Basin
|Tuesday, December 28, 2004
Stone Energy has signed a purchase and sale agreement to acquire approximately 35,000 net exploration acres in the Williston Basin of North Dakota and Montana from a small independent company effective January 1, 2005. The acquisition cost of approximately $85 million is expected to be funded with borrowings under Stone's bank credit facility pending final closing, which is expected in February 2005.
"This acquisition represents another significant step in efforts to diversify our asset base," stated David H. Welch, president and chief executive officer. "Combined with our recent acreage acquisition in Utah, we have created several growth opportunities for exploration and development in the Rocky Mountain region."
The acquisition includes proved reserves and a minimal amount of oil production. Approximately 85% of the purchase price is expected to be allocated to unevaluated acreage. Much of this acreage is located within the Bakken formation fairway with attractive stacked-pay potential. Stone expects to begin exploring the acreage with a multi-well drilling program beginning in 2005.