Black Ridge Oil & Gas Announces Acquisition of Williston Basin Assets for $20.5 Million
Nov 20, 2013 Source Pr Newswire
MINNETONKA, Minn., Nov. 20, 2013 /PRNewswire/ -- Black Ridge Oil & Gas, Inc. (the "Company") (OTCQB: ANFC), a well-positioned exploration and production (E&P) company focused on non-operated Bakken and Three Forks properties, today announced that it has signed a definitive purchase and sale agreement ("PSA") with a private party to acquire certain producing oil and gas wells and development acreage in the Williston Basin for $20.5 million, subject to certain purchase price adjustments as defined in the PSA.
Transaction Details:
Acquired net production of approximately 165 barrel of oil equivalents per day ("BOE/d"), based on internal operating reports, representing a 53% increase over Black Ridge's third quarter average of 308 BOE/d
Acquired proved reserves of 1.9 million barrel of oil equivalents ("MMBOE") representing a 79% increase over the Company's year-end 2012 proved reserves of 2.4 MMBOE *
Total PV10 of the acquired proved reserves equals $37.2 million with proved developed producing representing 34%, or $12.7 million, and proved undeveloped reserves (PUD) of $24.5 million.*
Properties currently operated by Burlington Resources Oil and Gas Company LP., Marathon Oil Company and Hunt Oil Company.
Approximately 2,046 net acres acquired at an 87.5% net revenue interest (NRI).
741 net acres located in northern Dunn County, North Dakota are held by production.
1,305 net acres located in Golden Valley County, ND are currently undeveloped with lease expirations in 2019.
*Note, reserve values of acquired assets are based on internal estimates.
Black Ridge expects the acquisition to close on or before December 13, 2013 with an effective date of October 1, 2013. The agreement is subject to customary due diligence and adjustments to be calculated as of the closing date.
Ken DeCubellis, Black Ridge's Chief Executive Officer, said: "This transaction demonstrates management's ability to utilize our platform to aggregate high return, quality assets in the heart of the Bakken / Three Forks development fairway to grow our drilling inventory, production and proved reserves in a meaningful way.? While the immediate increase in production and cash flow are a benefit to the Company, the real long term value of this acquisition is in the high return development projects and drilling inventory."
Financing the Acquisition
Black Ridge will finance the acquisition with availability from our senior secured credit facility with Cadence Bank, N.A., our second lien credit facility with Chambers Energy Management, L.P., and cash on hand. ?In conjunction with the closing of the transaction, Cadence has agreed to increase the Company's borrowing base from $7.0 million to $18.0 million. ?The Cadence borrowing base is subject to periodic redeterminations based on changes to the Company's reserve base.? The Company expects the availability under both facilities to grow as it continues to acquire and develop new, high value leaseholds in the heart of the Bakken and Three Forks development fairway.? As of November 20, 2013, the Company had not drawn from the Cadence facility and had an additional $10.0 million of availability under its Chambers facility.
