FORT WORTH, Texas, July 28, 2015 /PRNewswire/ -- Lonestar Resources,
Ltd. (OTCQX:LNREF, ASX:LNR) is pleased to announce the closing of a
$100 million Joint Development
Agreement ("JDA") with IOG Capital, L.P. The Agreement
provides incremental non-recourse capital for Lonestar to drill
wells in its focus area of the Eagle Ford Shale play.
Lonestar's agreement with IOG Capital makes available a maximum
of $100 million in funds to be used
in drilling incremental Eagle Ford Shale wells. The Joint
Development Agreement, which calls for IOG to participate as a
non-operated working interest owner, states that the funds can be
deployed towards the drilling and completion of Eagle Ford Shale
wells which meet the collective return criteria of Lonestar and
IOG. The JDA calls for IOG to contribute up to 90% of the
initial capital for wells drilled in the program, with Lonestar
contributing the remainder of well costs. After IOG achieves
a specified return, Lonestar's working interest would increase to
90%.
Lonestar's Chief Executive Officer and Managing Director,
Frank D. Bracken, III, commented,
"Our deal with IOG Capital is tailor-made for Lonestar's strategy
in the current market- it makes sense to pursue additional growth
opportunities in the current market, but do so in a manner that is
consistent with Lonestar's philosophy of maintaining balance sheet
flexibility. First and foremost, this Agreement will allow
Lonestar to more aggressively pursue additional farm-in
opportunities without materially augmenting our capital budget.
Farm-ins have been a principal source of leasehold and
reserve growth for Lonestar in 2015, and we see that trend
continuing."
Bracken added, "The Joint Development Agreement will also allow
Lonestar to spread its drilling capital over a larger number of
wells, which should have positive benefits in terms of scale, as
well as enlarge the number and size of acquisitions the Company can
prosecute, which makes sense for a company our size."
About IOG Capital, L.P.
IOG Capital, L.P. is an energy-focused private investment firm
partnered with Fortress Investments and Metalmark Capital, with
over $700 million in deployable
capital. Founded in 2014 by former Chesapeake Energy
Corporation (NYSE: CHK) Chief Financial Officer, Marc Rowland, the firm seeks to provide funding
solutions to development oriented oil and gas projects located
onshore in the United States
through joint ventures and non-operated asset level investment.
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SOURCE Lonestar Resources, Ltd.