Abraxas Announces Acquisition of 2,008 Net Wolfcamp/Bone Spring Acres
May 23 2017 - 4:15PM
Business Wire
Abraxas Petroleum Corporation (“Abraxas” or the “Company”)
(NASDAQ:AXAS) today announced the signing of a definitive agreement
to acquire 2,008 net acres and 33 Boepd in Ward County, Texas
prospective for the Wolfcamp/Bone Spring. Highlights include:
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Map of Abraxas’ updated acreage position.
(Graphic: Business Wire)
- Definitive agreement signed to
acquire 2,008 net acres and 33 Boepd (91% natural gas) in Ward
County prospective for the Bone Spring and Wolfcamp for $22.2
million
- Up to four identified zones across
the Third Bone Spring and Wolfcamp
- Acquisition consists of interests in
three incremental operated units, four non-operated units as well
as interests in three existing Abraxas operated units
- Adds 32 gross, 25 net operated
potential locations and 48 gross, 8 net non-operated potential
locations not including increased working interests in existing
operated units
Ward County Acquisition
In Ward County, Texas Abraxas recently signed a definitive
agreement to acquire 33 Boepd and 2,008 net mineral acres
prospective for the Bone Spring and Wolfcamp formations for $22.2
million. The acquisition consists of approximately 1,888 net acres
held by production and 120 net leasehold acres covered by a
three-year primary term lease. The acreage purchased consists of
two operated units, four non-operated units and additional
interests in three existing Abraxas operated units on trend and
adjoining the Company’s existing acreage position. The acreage is
prospective for up to four zones across the Wolfcamp and Third Bone
Spring, providing an additional 80 gross potential locations to
Abraxas’ inventory (not including increased working interests in
existing operated units). Abraxas plans to fund the acquisition
entirely on the Company’s line of credit with an anticipated
closing date in June 2017. Abraxas capital budget of $110 million
remains unchanged. Included is a map of Abraxas’ updated acreage
position.
Bob Watson, President and CEO of Abraxas, commented, “During our
January 2017 equity raise, our stated corporate goals were to add
Wolfcamp/Bone Spring acres in the Delaware Basin at a reasonable
cost, continue to derisk our Delaware Basin acreage position, build
our production base to a critical mass by year end and maintain our
best in class balance sheet. We are pleased to announce that we
remain on track to achieve all of these goals.
“This Delaware Basin acquisition fits seamlessly within our
existing acreage footprint and increases our exposure to the
Delaware Basin Bone Spring/Wolfcamp play by approximately 35% to
7,757 (1) net acres. Importantly this was done at a favorable price
of just over $10,000/acre. We continue to evaluate similar bolt on
opportunities to further expand our Delaware Basin footprint.“
(1) Includes 480 net acres on Abraxas’ Howe
lease which is currently subject to a title dispute. Abraxas does
not have any reserves or planned 2017 capital expenditures relating
to the acreage that is subject to this title dispute.
Abraxas Petroleum Corporation is a San Antonio based crude oil
and natural gas exploration and production company with operations
across the Rocky Mountain, Permian Basin and South Texas regions of
the United States.
Safe Harbor for forward-looking statements: Statements in this
release looking forward in time involve known and unknown risks and
uncertainties, which may cause Abraxas’ actual results in future
periods to be materially different from any future performance
suggested in this release. Such factors may include, but may not be
necessarily limited to, changes in the prices received by Abraxas
for crude oil and natural gas. In addition, Abraxas’ future crude
oil and natural gas production is highly dependent upon Abraxas’
level of success in acquiring or finding additional reserves.
Further, Abraxas operates in an industry sector where the value of
securities is highly volatile and may be influenced by economic and
other factors beyond Abraxas’ control. In the context of
forward-looking information provided for in this release, reference
is made to the discussion of risk factors detailed in Abraxas’
filings with the Securities and Exchange Commission during the past
12 months.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170523006446/en/
Abraxas Petroleum CorporationGeoffrey King, 210-490-4788Vice
President – Chief Financial
Officergking@abraxaspetroleum.comwww.abraxaspetroleum.com
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