Delta Petroleum to Acquire Alpine Resources Proved Reserves
|Wednesday, June 16, 2004
Delta Petroleum has agreed to purchase all of the proved reserves owned by Alpine Resources, Inc. Alpine is represented in the transaction by Petroleum Place Energy Advisors. The effective date of the transaction is June 1, 2004, and it is expected to close on or before June 30, 2004. Specific terms of the transaction were not disclosed, but Delta estimates that it is paying approximately $1.40 per MCF equivalent (MCFE) for Alpine's proved reserves.
Alpine's properties currently produce approximately 20 million cubic feet of gas-equivalents (MMCFE) per day, and Alpine is the operator of properties that account for approximately 95% of its proved reserves. Delta estimates that Alpine's total proved reserves exceed 90 billion cubic feet of gas- equivalents (BCFE), with total reserves* in excess of 140 BCFE. Approximately 50% of current daily production is comprised of oil and 50% of natural gas, with oil representing approximately 55% of total proved reserves. Delta is in the process of completing its due diligence review of the properties and finalizing its financing arrangements for the transaction. Financing arrangements are currently expected to include an increase in bank debt and possible sales of non-core properties. Other alternatives are also being explored.
"We are very pleased to announce this agreement with Alpine Resources, which upon completion will increase Delta's daily production by approximately 65%," stated Roger Parker, President and Chief Executive Officer of Delta Petroleum Corporation. "There is significant undeveloped potential in the properties, including 37 'behind pipe' and 65 proved undeveloped opportunities. Additional probable locations have also been identified. We expect to begin developing the asset in the near future and believe it is possible to increase daily output from the Alpine properties by 25% or more in the upcoming fiscal year."
Delta Petroleum Corporation is an independent oil and gas exploration and development Company based in Denver, Colorado. The Company has producing properties in 15 states and interests in one producing federal unit and four undeveloped units located in federal waters offshore California near Santa Barbara.