QEP Resources to acquire oil properties in the Permian Basin

Published Dec 11, 2013
QEP Resources Inc.

QEP Resources Inc., announced that its wholly owned subsidiary, QEP Energy Company, has entered into a definitive agreement to acquire oil and gas properties in the Permian Basin for an aggregate purchase price of approximately $950 million (the 'Acquisition'). The properties, which are located in the Midland sub-basin, primarily in Martin and Andrews counties in west Texas, will diversify the Company's exploration and production footprint, and advance QEP's objective to create long-term shareholder value through the continued emphasis on high-margin crude oil and natural gas liquids production. The Company's Board of Directors was unanimous in its approval of the Acquisition.

Acquisition Highlights:

◾ Current net production of approximately 6,700 barrels of oil equivalent per day (Boepd), of which approximately 68% is crude oil ◾ Net proved reserves based on internal estimates of approximately 47 million barrels of oil equivalent (MMBoe) ◾ Total estimated net recoverable resources of up to 300 MMBoe ◾ Nine potential horizontal development targets over a 3,000 foot vertical section ◾ 26,519 net acres with an average working interest of 94% and a 75% net revenue interest ◾ 264 vertical producing wells with nearby horizontal activity by industry peers ◾ Potential for over 200 vertical and up to 775 horizontal drilling locations ◾ Attractive valuation at less than 4.0x estimated 2015 Adjusted EBITDA ◾ Combined with anticipated asset sales, significantly transforms QEP's asset base towards oil- and liquids-weighted growth

Tags: QEP Resources Inc.


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