XTO Energy Acquires Producing Properties from Plains Exploration
XTO Energy has agreed to purchase producing properties from Plains Exploration & Production for $350 million, effective January 1, 2005. These properties further expand the Company's operations in its core Eastern Region of East Texas and northern Louisiana. XTO Energy's internal engineers estimate the proved reserves to be 175 billion cubic feet of gas equivalent (Bcfe), of which 75% are proved developed and 95% are attributable to natural gas. Development costs for the proved undeveloped reserves are estimated at $.90 - $1.20 per thousand cubic feet (Mcf). The acquisitions will initially add production of about 35 million cubic feet of natural gas per day (MMcf/d). As a result, the Company is increasing its production growth target in 2005 to 23-25%, up from 21-23%.
"This acquisition illustrates the ongoing momentum the XTO franchise has built in our core operating positions across the country. We stake our initial claim and then grow through drilling and additional purchases," stated Bob R. Simpson, Chairman and Chief Executive Officer. "These properties fit perfectly into our long-term development platform and further strengthen our position as a top producer in East Texas."
These premium producing properties expand XTO Energy's holdings in the Sabine Uplift and Cotton Valley trends. Significant fields include Carthage, Rosewood, White Oak/Glenwood, Beckville, East Henderson and Oak Hill. The predominant producing formations are the sand sequences of the Cotton Valley, Bossier, Travis Peak and Pettit zones. XTO will operate about 60% of the value of the acquired interests.
The transaction is scheduled to close on or before May 31, 2005. The
final closing price will reflect a net revenue adjustment from the effective
date, currently estimated at $20 - 25 million, typical closing and post-
closing adjustments and minor preferential purchase right elections.
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Company: Plains Exploration & Production more info
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