Petrohawk Energy Acquires Acreage in Core Areas

Petrohawk Energy has entered into a definitive agreement to purchase an undisclosed private company for $53 million in cash. This privately negotiated transaction includes estimated proved reserves of 28 Bcfe. The agreement has an economic effective date of January 1, 2005.

The properties to be acquired are located in South Louisiana and South Texas. Additional transaction highlights include the following estimates:

  • 5.0 Mmcfe of production per day

  • 46% natural gas
  • 47% proved developed

  • 97% operated

  • 15 year reserves-to-production ratio

  • Probable and possible reserves of over 100 Bcfe

  • Major properties in the asset base include interests in a multi-pay field in South Louisiana, with 16 Bcfe of estimated proved reserves, 1,018 gross acres and nine PUD locations. In South Texas, significant properties include interests in a multi-pay Frio sand field with 7 Bcfe of estimated proved reserves, 4,230 gross acres and fifteen PUD locations. The acquisition also includes 3-D seismic data covering all major properties. Petrohawk plans an aggressive drilling program on the properties in 2005 and increased its previously announced 2005 capital program from $60 million to $70 million.

    The transaction is expected to close by February 28, 2005 and is subject to customary closing adjustments and conditions. Petrohawk expects to finance the transaction through its existing credit facility.