2008-10-21-2008-05-05-2008-05-30

Acquired producing wells, acreage, facilities in Flat Rock Field in Uintah Basin, Uintah Co., UT, gaining 115 Bcfe proved, 19 MMcfe/d net.

Whiting Petroleum Corp., Denver, (NYSE: WLL) has closed its acquisition of interests in producing gas wells, development acreage and gas-gathering facilities in Flat Rock Field in the Uintah Basin in Uintah County, Utah, from Chicago Energy Associates LLC for $365 million. Estimated net production for March was 19 million cubic feet of gas equivalent per day. Whiting estimates proved reserves to be 115.2 billion cubic feet equivalent (98% gas; 22% proved developed producing; 78% proved undeveloped). The assets include interest in 22,029 gross acres (11,534 net) with seven wells producing from the Entrada sandstone formation at a depth of 11,500 feet, as well as 24 wells producing from shallower Wasatch and Dakota formations. Production from the wells completed in the Entrada formation makes up 97% of the net daily production. Upside includes approximately 59 additional well locations, of which Whiting expects to operate 15 while 44 are expected to be operated by another experienced area operator. Gas-gathering assets in the acquisition include 44 miles of lines, compression and processing facilities which deliver gas to the Questar Mainline 40 interstate pipeline. Whiting is allocating $35 million of the purchase price to the gas-gathering facilities. Based on the $330-million cost for proved reserves, the company values the deal at $2.86 per thousand cubic foot equivalent. Approximately 83% of the current net daily production will be operated by Whiting. Whiting will finance the acquisition with borrowings under its existing bank credit facility. Following the recent $220-million debt retirement with proceeds of the Whiting USA Trust I, Whiting expects its debt-to-capitalization to be approximately 41% after closing. Whiting president and chief executive James J. Volker says, "We believe this is an excellent acquisition for Whiting and our shareholders in light of the $2.86 per Mcfe acquisition cost and the significant upside potential for reserve additions at Flat Rock Field. We also expect the continued development planned for Flat Rock Field to increase our net production from the field by approximately 70% in 2009 and to double the current rate in 2010." The effective date is Jan. 1. Merrill Lynch Petrie Divestiture Advisors was advisor to Chicago Energy. Whiting operates primarily in the Permian Basin, Rocky mountains, Midcontinent, Gulf Coast and Michigan regions.