Loudon Exploration to Sell South Texas Assets
|Thursday, September 30, 2004
Loudon Exploration and its affiliated partners have exclusively retained Energy Spectrum Advisors to solicit bids related to the proposed sale of certain operated oil and gas properties in South Texas. The Company is offering for sale their collective 75-100% working interest (63.7-75% NRI) and operating rights and control in the Encinitas and Rucias, N. Fields which are located in Brooks County, TX, about 90 miles southwest of Corpus Christi, TX. The assets represent a mix of Proved Producing reserves with significant Proved upside in various Frio and Vicksburg reservoirs.
Loudon's current net daily production from the Properties is 7.6 million cubic feet of natural gas per day and 176 barrels of condensate per day. Loudon has identified a sizeable inventory of remaining Proved recompletion and development projects that are estimated to substantially increase production and cash flow over the next several years.
LaRoche Petroleum Consultants, Ltd. (Dallas, TX) has prepared an independent evaluation of the Properties. LaRoche estimates Loudon's net remaining total Proved reserves to be approximately 14.1 billion cubic feet of natural gas and 129 thousand barrels of oil, with an average gross daily rate of 15.9 million cubic feet equivalent per day in 2005. The total Proved PV-10 of the properties based on the LaRoche estimates is $43.2 million, assuming a recent 4-year NYMEX strip.
ESA will be hosting a data room in Dallas beginning in late October. Loudon intends to close the transaction on or about December 16, 2004, with an effective date of November 1, 2004. Interested parties are requested to contact Charlie Lapeyre (214) 987-6123 or Kyle Miller (214) 987-6125 at ESA with inquiries.