NOG Announces the Exercise of Option to Purchase Additional Uinta Basin Assets
August 07 2024 - 6:00AM
Business Wire
HIGHLIGHTS
- NOG and SM Energy Company (“SM”) exercised option to jointly
acquire additional Uinta Basin assets adjacent to the XCL
Resources, LLC asset acquisition, which were previously owned by
Altamont Energy LLC (the “Altamont Assets”)
- NOG to acquire a 20% undivided stake in the Altamont Assets
(the “Acquired Assets”) for an unadjusted purchase price of $17.5
million in cash (all data below is net to NOG)
- Expands Uinta footprint by ~6,500 net acres, located primarily
in Duchesne and Uintah Counties, UT
- Transaction to close simultaneously with the close of the XCL
asset acquisition
- NOG’s total Uinta net acreage to increase to ~15,800 with ~116
net underwritten undeveloped locations and additional exploration
upside potential
- Altamont purchase to be funded by cash flow from operations,
cash on hand and borrowings under NOG’s Senior Secured Revolving
Credit Facility
Northern Oil and Gas, Inc. (NYSE: NOG) (the “Company” or “NOG”)
today announced that it has exercised its option to acquire a 20%
undivided stake in the Altamont Assets in partnership with SM for a
purchase price, net to NOG, of $17.5 million in cash, subject to
customary closing adjustments.
The Acquired Assets are located primarily in Uintah and Duchesne
Counties, Utah and include approximately 6,500 net acres. NOG’s
initial estimates are for approximately 18 net undeveloped
locations on the properties and ~250 Boe per day of expected
production. Altamont was previously under contract with XCL
Resources and was offered to NOG and SM under a right of first
refusal in connection with the XCL asset acquisition.
Upon closing and transition of services, the operator of
substantially all of the assets will be SM, with NOG participating
in development pursuant to cooperation and joint development
agreements entered into in connection with the XCL asset
acquisition.
NOG expects to close the transaction simultaneously with the
closing of the XCL asset acquisition in early Q4 2024. The
obligations of the parties to complete the transactions
contemplated by the acquisition agreement are subject to the
satisfaction or waiver of customary closing conditions.
MANAGEMENT COMMENTS
“We are excited to execute the option to purchase
additional Uinta assets under our Area of Mutual Interest agreement
with SM. The Altamont Assets increase our Uinta footprint
substantially and are a testament to the benefits of the joint
venture structures we have pursued in recent years,” commented Nick
O’Grady, NOG’s Chief Executive Officer. “This transaction grows our
estimated Uinta inventory by nearly 20% and given the 70% increase
in acreage, provides significant future exploration potential for a
minimal cash outlay.”
ADVISORS
RBC Capital Markets served as financial advisor to NOG for the
XCL and Altamont acquisitions.
Kirkland & Ellis LLP is serving as legal counsel to NOG.
ABOUT NOG
NOG is a real asset company with a primary strategy of acquiring
and investing in non-operated minority working and mineral
interests in the premier hydrocarbon producing basins within the
contiguous United States. More information about NOG can be found
at www.noginc.com.
SAFE HARBOR
This press release contains forward-looking statements regarding
future events and 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 release regarding NOG’s financial position, common stock
dividends, business strategy, plans and objectives of management
for future operations, industry conditions, capital expenditures,
production, cash flow, hedging and other matters are
forward-looking statements. When used in this release,
forward-looking statements are generally accompanied by terms or
phrases such as “estimate,” “guidance,” “project,” “predict,”
“believe,” “expect,” “continue,” “anticipate,” “target,” “could,”
“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, production, drilling locations,
capital expenditures, 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
NOG’s control) that could cause actual results to differ materially
from those set forth in the forward-looking statements, including
the following: changes in crude oil and natural gas prices; the
pace of drilling and completions activity on NOG's properties and
properties pending acquisition; infrastructure constraints and
related factors affecting NOG’s properties; cost inflation or
supply chain disruptions; ongoing legal disputes over and potential
shutdown of the Dakota Access Pipeline; NOG’s ability to acquire
additional development opportunities, potential or pending
acquisition transactions (including the transactions described
herein), the projected capital efficiency savings and other
operating efficiencies and synergies resulting from NOG’s
acquisition transactions, integration and benefits of property
acquisitions, or the effects of such acquisitions on NOG’s cash
position and levels of indebtedness; changes in NOG's reserves
estimates or the value thereof; disruption to NOG’s business due to
acquisitions and other significant transactions; general economic
or industry conditions, nationally and/or in the communities in
which NOG conducts business; changes in the interest rate
environment, legislation or regulatory requirements, conditions of
the securities markets; increasing attention to environmental,
social and governance matters; NOG's ability to consummate any
pending acquisition transactions (including the transactions
described herein); other risks and uncertainties related to the
closing of pending acquisition transactions (including the
transactions described herein); NOG's ability to raise or access
capital; cyber incidents; changes in accounting principles,
policies or guidelines; events beyond NOG’s control, including a
global or domestic health crisis, acts of terrorism, political or
economic instability or armed conflict in oil and gas producing
regions or elsewhere; and other economic, competitive,
governmental, regulatory and technical factors affecting NOG's
operations, products and prices.
NOG 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 NOG's control. Accordingly, results actually
achieved may differ materially from expected results described in
these statements. Forward-looking statements speak only as of the
date they are made. NOG does not undertake, and specifically
disclaims, any duty to update or revise any forward-looking
statements to reflect events or circumstances after the date of
such statements, except as may be required by applicable law or
regulation.
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version on businesswire.com: https://www.businesswire.com/news/home/20240807540111/en/
Evelyn Leon Infurna Vice President of Investor Relations (952)
476-9800 ir@northernoil.com
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