Pacific Energy Finalized Purchase of Alaska Oil and Gas Assets
Pacific Energy Resources has completed the acquisition of the Alaska oil and gas properties and operations of Forest Oil and Forest Alaska Holding. The Corporation has acquired 100% of the membership interests in Forest Alaska Operating, which owns the majority of the Alaska properties and operations, plus certain additional Alaska assets owned by Forest, including an interest in the Cook Inlet Pipe Line for US$400,000,000 plus the issuance of 10,000,000 shares of the Corporation's common stock and a seven year seller note to Forest with a net present value of approximately $30,000,000.
Acquisition financing was provided by the Company's current lending group. Energy Capital Solutions, LP served as the Corporation's financial advisor related to the acquisition including the delivery of a fairness opinion to the Corporation's Board of Directors, and acted as placement agent in arranging the financing to fund the acquisition.
The FAO assets include nine fields located in the Cook Inlet area, producing approximately 5,000 BOE/day net to the interests being acquired. In addition to the producing properties, the Forest assets to be acquired include nearly 1,000,000 net acres covering multiple exploration prospects; plus a 50% equity interest in the Cook Inlet Pipe Line Company
DeGolyer & MacNaughton, an independent consulting firm retained by the Corporation, estimated 26.06 million barrels equivalent (MMBOE) of net Proved Reserves (11.3 MMBOE of Proved Developed Producing, 2.6 MMBOE of Proved Developed Non-Producing and 12.22 MMBOE of Proved Undeveloped), 27.82 MMBOE net Probable reserves and 6.72 MMBOE of Possible reserves for a total of 60.59 MMBOE of Proved, Probable and Possible Reserves, under August 1st, 2007 Nymex strip prices.
"We are extremely pleased to have successfully completed this acquisition; it represents a tremendous opportunity for the Corporation and its shareholders. This package of assets is a direct extension of our business strategy; the established production, with long life reserves, generates strong predictable cash flow. The multiple infill drilling opportunities provide a low risk means to grow the Corporation production through redevelopment. Significant undeveloped acreage with multiple high quality exploration targets, provides large exploration upside," said Darren Katic the Corporation's president.
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Company: Pacific Energy Resources more info
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