Vanguard Natural Resources, LLC (VNR) (“Vanguard” or “the Company”) today announced that on June 29, 2012 it consummated the previously announced acquisition of natural gas and liquids assets from Antero Resources for an adjusted purchase price of $434.4 million, subject to customary final post-closing adjustments. The effective date of the acquisition is April 1, 2012.
Significant benefits expected from the acquisition:
- Immediately accretive to distributable cash flow;
- Proved reserves of approximately 420 Bcfe (58% proved developed and 82% natural gas);
- Reserve to production ratio of approximately 15 years;
- Current net production of approximately 76 MMcfe/d (91% natural gas) from 833 gross wells (134 producing wells to be operated by Vanguard in the Woodford Shale);
- Approximately 66,000 net acres in the Woodford Shale play and 5,300 net acres in the Fayetteville Shale play;
- Approximately 180 proved drilling locations with an average 22.5% working interest that are expected to generate superior returns even in a low gas price environment. We have also identified an additional 1,100 future proved drilling locations on acreage that is held by production that can be developed should natural gas prices return to the $4-$5 range; and
- Existing natural gas hedge book valued at approximately $100 million which we intend to restructure to cover 100% of expected proved production for the next five years at prices significantly higher than current market.
The Company funded this acquisition with borrowings under its existing reserve-based credit facility. As anticipated, Vanguard’s borrowing base was increased from $670 million to $975 million in connection with an interim borrowing base redetermination to include the properties from this acquisition. As of June 29, 2012 and pro forma for the borrowing base increase and financing for this acquisition, the Company has borrowings under its reserve-based credit facility of $734 million which leaves $241 million of undrawn capacity.
Updated 2012 production and financial results guidance will be included in the second quarter results press release which is expected to be issued on August 2, 2012.
Recommended Reading
Marketed: Mineral, Royalty Interests in Permian, Powder River Basins
2024-05-21 - A private seller has retained Detring Energy Advisors for the sale of its mineral and royalty interests in the Permian and Powder River basins.
Evolution Petroleum Sees Production Uplift from SCOOP/STACK Deals
2024-05-07 - Evolution Petroleum said the company added 300 gross undeveloped locations and more than a dozen DUCs.
Minerals Market Growing But Needs More Scale, Consolidation
2024-05-15 - The market value of public minerals and royalties companies has doubled since 2019—but the sector needs to grow even larger to attract generalist investors into the fray, experts say.
Marketed: Anschutz Three-well Opportunity in Powder River Basin
2024-06-25 - Anschutz Exploration Corp. has retained EnergyNet for the sale of three wells in the Powder River Basin.
Marketed: Gulfport Appalachia Utica Oil Opportunity
2024-05-22 - Gulfport Appalachia LLC has retained EnergyNet for the sale of three EOG operated Utica wells in Noble County, Ohio.