Contango Announces Signing of Agreement to Acquire Assets of White Star Petroleum LLC
The asset purchase agreement provides that Contango will acquire approximately 15 Mboe/d of production, approximately 20 Mmboe of PDP reserves as of the
|District||Net Acres (Approx)||Operated Wells||Non-Operated Wells|
White Star’s production is liquids weighted at 63% oil and NGLs, and the acreage is 80% held-by-production. Approximately 65% of the wells are operated by White Star and are mature fields with strong cash flow and significant development potential from PDNP and PUD opportunities. The White Star assets also include integrated gathering and saltwater disposal systems, which reduces lease operating expenses and adds third party cash flow.
The transaction is expected to close in the fourth quarter of 2019, and the effective date of the transaction will be
The closing of the transaction is subject to customary conditions, due diligence, confirmation of title, finalization of documentation, and entry of the bankruptcy court order approving the sale; however, closing is not conditioned upon satisfaction of any financing contingency.
Approximately 35% of Contango’s equity is owned by
Contango Oil &
Forward-Looking Statements and Cautionary Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on Contango’s current expectations and includes statements regarding the timing and completion of the closing of the acquisition, the benefits of the pending acquisition, the development potential of the White Star assets, expected production, cash flows and reserves from the White Star assets, the total consideration to be paid at the closing of the acquisition, the Company’s drilling program and capital expenditures, future results of operations, strategic initiatives, the quality and nature of the White Star properties, acquisition efforts and results, and other expectations, beliefs, plans, objectives, assumptions, strategies, future events or performance. Words and phrases used to identify our forward-looking statements include terms such as "expects", "anticipates", “believes”, "plans", "estimates", "potential", "intends", or words and phrases stating that certain actions, events or results "may", "will", "should", or "could" be taken, occur or be achieved. Statements concerning oil and gas reserves also may be deemed to be forward looking statements in that they reflect estimates based on certain assumptions that the resources involved can be economically exploited. Forward-looking statements are based on current expectations, estimates and projections that involve a number of risks and uncertainties, which could cause actual results to differ materially from those, reflected in the statements. These risks include, but are not limited to: risks associated with a pending acquisition (for example, obtaining acceptable financing, satisfaction of conditions to closing, inability to realize the expected benefits, reliance on information provided by seller, verification or revision of such information regarding the assets, results of diligence, changes in ownership of the target assets, relationships with customers and serve providers, and obtaining required judicial, government and regulatory approvals); the risks of the oil and gas industry (for example, operational risks in exploring for, developing and producing crude oil and natural gas; risks and uncertainties involving geology of oil and gas deposits; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to future production, costs and expenses; potential delays or changes in plans with respect to exploration or development projects or capital expenditures; health, safety and environmental risks and risks related to weather); uncertainties as to the availability and cost of financing; fluctuations in oil and gas prices; ability of our management team to execute its plans or to meet its goals; and the other factors discussed under the “Risk Factors” heading in our annual report on Form 10-K for the year ended
|Contango Oil & Gas Company|
|E. Joseph Grady – 713-236-7400||Sergio Castro – 713-236-7400|
|Senior Vice President and Chief Financial Officer||Vice President and Treasurer|
Source: Contango Oil & Gas