Panhandle Oil and Gas Inc. (NYSE: PHX) has closed on the acquisition of certain Eagle Ford assets in La Salle and Frio counties for $80,400,000. This acquisition was funded by utilizing the company's bank credit facility. The deal was announced in May.
The assets were acquired from private sellers and include a 16% non-operated working interest in an 11,100 gross leasehold acres (1,775 net acres) block that is largely contiguous and entirely held by production, 63 producing wells (57 Eagle Ford, 5 Pearsall, and 1 Buda), one well being drilled and 109 undeveloped Eagle Ford locations. Three wells are in the completion phase. This property is being developed with a one drilling rig program by the operator, privately held Cheyenne Petroleum Co. Oklahoma City-based Cheyenne came in at No. 63 in the April OGFJ100P list of top privately-held companies by boe.
Production from the acquired assets, net to Panhandle's interest for May 2014, averaged 825 boe per day (80% oil). There were five new wells, which began production in May and were on line for a partial month.
In addition, the company reported that, on June 17, it increased its bank credit facility to $200 million with a current borrowing base set at $130 million. The terms and conditions of the credit facility remain materially unchanged, and the facility matures on November 30, 2018.