American Eagle Energy Announces Closing of Acquisition and Purchase of Additional Acreage in Spyglass
March 31 2014 - 7:00AM
Marketwired
American Eagle Energy Announces Closing of Acquisition and Purchase
of Additional Acreage in Spyglass
DENVER, CO--(Marketwired -
March 31, 2014) - American Eagle Energy Corporation
(NYSEMKT: AMZG) ("American Eagle" or
the "Company") has closed the second part of the previously
announced acquisition in its Spyglass area in the Williston Basin
and has recently purchased additional acreage in its Spyglass area.
As of March 31, 2014, the Company holds approximately 45,600 net
acres in its Spyglass area with an average working interest of
approximately 68%.
Closed Acquisition from JV Partner
On March 27, 2014, American Eagle closed the second part of the
previously announced acquisition in its Spyglass area in the
Williston Basin in northwestern Divide County, North Dakota. For a
gross purchase price of $47 million, or $45.75 million in cash
after adjusting for positive purchase price adjustments, the
Company acquired approximately 8,244 net acres in Spyglass with
production of approximately 450 barrels of oil equivalent per day
("BOEPD") with proved reserves of approximately 2.3 million barrels
of equivalent ("BOE") and Pre-Tax PV-10 of approximately $55
million based on Company and Ryder Scott estimates. The acquisition
increased American Eagle working interests from approximately 44%
to 55% in its total Spyglass area and from approximately 51% to 60%
in its proved area of Spyglass.
The Company financed the acquisition with a portion of the
proceeds from its recent offering of 12,650,000 shares of common
stock with net proceeds of approximately $78 million that closed on
March 24, 2014.
Additional Acreage Acquisitions in Spyglass
American Eagle purchased an additional 7,764 net acres for total
purchase price of approximately $11.3 million. The majority of
these acquisitions closed late last week and certain on the ground
leasing acreage was acquired earlier in the first quarter ended
March 31, 2014.
The Company estimates, based on assumptions and estimates from
its 2013 year-end reserve report, the acquisition of the additional
7,764 net acres represents approximately $20 million of potential
Pre-Tax PV-10 proved reserves ("1P") and approximately $27 million
of potential Pre-Tax PV-10 probable reserves ("2P") for a total of
$47 million Pre-Tax PV-10 of 1P + 2P reserves. The majority of the
purchased acreage is undeveloped acreage in American Eagle's
western portion of Spyglass with approximately 14 BOEPD of existing
operated production. The additional acreage acquisitions increase
American Eagle's average working interest in its total Spyglass
area to approximately 68% and its average working interest in its
proved area of Spyglass to approximately 67%.
The Company financed the additional acreage acquisitions with a
portion of the proceeds from its recent common stock offering. A
portion of the estimated use of proceeds was designated for general
corporate purposes including working capital and additional
leasehold acquisitions. The additional acreage acquisitions were
within the designated budget.
Management Comments
Brad Colby, President and CEO of American Eagle, said, "The
acquisitions are a testament to our confidence in the Spyglass area
and the abilities of our land team to identify and quickly close
transactions at attractive prices. Over the last several months, we
have significantly increased the working interests in our Spyglass
area and believe this will provide tremendous upside potential to
shareholders as we develop wells and capture more of the attractive
well economics in Spyglass."
ABOUT AMERICAN EAGLE ENERGY CORPORATION
American Eagle Energy Corporation is an independent exploration
and production operator that is focused on acquiring acreage and
developing wells in the Williston Basin of North Dakota, targeting
the Bakken and Three Forks shale oil formations. The Company is
based in Denver, CO. More information about American Eagle can be
found at www.americaneagleenergy.com or by contacting investor
relations at 303-798-5235 or ir@amzgcorp.com. Company filings with
the Securities and Exchange Commission can be obtained free of
charge at the SEC's website at www.sec.gov.
SAFE HARBOR
This press release may contain forward-looking statements
regarding future events and the Company's future results that are
subject to the safe harbors created under the Securities Act of
1933 (the "Securities Act") and the Securities Exchange Act of 1934
(the "Exchange Act"). All statements other than statements of
historical facts included in this press release regarding the
Company's financial position, business strategy, plans and
objectives of management for future operations, industry
conditions, and indebtedness covenant compliance are
forward-looking statements. When used in this report,
forward-looking statements are generally accompanied by terms or
phrases such as "estimate," "project," "predict," "believe,"
"expect," "anticipate," "possible," "target," "plan," "intend,"
"seek," "goal," "will," "should," "may" or other words and similar
expressions that convey the uncertainty of future events or
outcomes. Items contemplating or making assumptions about,
actual or potential future sales, market size, collaborations, and
trends or operating results also constitute such forward-looking
statements.
Forward-looking statements involve inherent risks and
uncertainties and important factors (many of which are beyond the
Company's control) that could cause actual results to differ
materially from those set forth in the forward-looking statements,
including the amount we may invest, the location, and the scale of
the drilling projects in which we intend to participate; our
beliefs with respect to the potential value of drilling projects;
our beliefs with regard to the impact of environmental and other
regulations on our business; our beliefs with respect to the
strengths of our business model; our assumptions, beliefs, and
expectations with respect to future market conditions; our plans
for future capital expenditures; and our capital needs, the
adequacy of our capital resources, and potential sources of
capital.
The Company has based these forward-looking statements on its
current expectations and assumptions about future
events. While management considers these expectations and
assumptions to be reasonable, they are inherently subject to
significant business, economic, competitive, regulatory, and other
risks, contingencies, and uncertainties, most of which are
difficult to predict and many of which are beyond the Company's
control. The Company does not assume any obligations to update any
of these forward-looking statements.
CONTACT: Marty Beskow, CFA Vice President of Capital Markets and
Strategy American Eagle Energy Corporation 720-330-8378
ir@amzgcorp.com www.americaneagleenergy.com
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