Goodrich Petroleum Corp. has entered into a definitive agreement to purchase a 66.7% working interest in producing assets and approximately 277,000 gross acres in the Tuscaloosa Marine Shale (TMS) trend for $26.7 million, with an effective date of March 1, 2013, subject to customary closing adjustments. The remaining 33.3% working-interest owner in the producing assets and leasehold has elected to retain its interest and participate with the company in developing the assets. The acquisition is subject to customary due diligence and is expected to close on or before August 22, 2013.
The gross oil production associated with the properties averaged approximately 750 barrels of oil per day for March 2013. At closing, the company will own approximately 320,000 net acres in the TMS when combined with its current position. Goodrich will prioritize the acreage with the ultimate number of retained acreage to be based on geologic location, timing and amount of lease extension payments, and future rate of development of the play.
Goodrich plans to fund the acquisition with its senior credit facility, which, along with available cash, had approximately $190 million of available liquidity pro forma as of March 31. Upon closing of the transaction, the company's borrowing base will increase by $18 million to $243 million.