Aurora Oil To Beef Up Presence In Eagle Ford Project

To buy additional 6% nonop WI of 1,440 net acres in Sugarloaf area targeting S TX Eagle Ford shale in Sugarkane Field.

Aurora Oil & Gas Ltd., Perth, (Australia: AUT) plans to acquire an additional 6% nonoperated working interest in the Sugarloaf area of mutual interest targeting the Eagle Ford shale in South Texas from an undisclosed seller for US$95 million in cash.

The Sugarloaf project is within Sugarkane Field and the acquisition will provide approximately 1,440 additional net acres, resulting in Aurora's net acreage in the field increasing by approximately 9% to more than 17,800 net acres. Aurora’s working interest will increase from 15.8% to 21.8%.

The additional acreage is operated by Marathon Oil EF LLC. Aurora will fund the deal from cash on hand and existing credit facilities.

The purchase follows Aurora's recently announced A$107-million on-market unconditional takeover offer for Eureka Energy Ltd. which holds approximately 1,521 net acres in the same Sugarloaf AMI through a 6.25% nonoperated working interest in the AMI.

Aurora executive chairman and chief executive Jon Stewart says, “This acquisition builds Aurora's already strong presence in the Sugarkane Field, growing our portfolio of Eagle Ford interests within our key focus area and in line with our stated strategy. It also further aligns our interests with Marathon, the operator of the Sugarkane Field. This is one of a growing number of opportunities we see within our key focus area where acreage holders are willing to realize clear and certain value for interests that require access to additional capital. Aurora is fortunate to have a strong and conservatively geared balance sheet to fund its continued participation in the development of the Sugarkane Field.”

The acquisition is expected to close by June 29.