Isramco to Acquire U.S. Oil and Gas Properties
Isramco, Inc. said Friday that it has signed an agreement with Five States Energy Company, LLC, an unaffiliated U.S. company, located in Dallas, Texas, to acquire certain oil and gas properties in Texas and New Mexico for $100 million.
The properties to be purchased include approximately 660 producing oil and gas wells. Net income from the properties in the first seven months of 2006 was approximately $11 million.
Isramco has received engineering estimates indicating that its share of the proved developed reserves would be approximately 2 million barrels of oil, 28 billion cubic feet of gas and 1.6 million barrels of by-products of natural gas.
Isramco intends to self-finance up to 15% of the purchase price and to finance the balance through loans.
The terms of the transaction include a deposit of $3 million paid by Isramco to the Seller. The remainder of the acquisition cost will be paid by Isramco at closing, which is currently scheduled for January 20, 2007. Closing is subject to certain conditions, including continuing due diligence by Isramco. If the transaction does not close for reasons not connected to the seller, the seller is entitled to keep the deposit.
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