Gastar closes Mid-Continent acquisition

Gastar Exploration Inc. (NYSE MKT: GST) has closed its acquisition of additional interests in its area of mutual interest (AMI) from its AMI co-participant, Husky Ventures Inc., and certain other parties. The acquisition is located within the STACK and Hunton Limestone formations, and includes working and net revenue interests in 103 gross (10.2 net) producing wells and approximately 15,700 net developed and undeveloped acres in Kingfisher and Garfield counties, Oklahoma. 

The purchase price of $42.1 million, with an effective date of July 1, was funded with borrowings under Gastar's revolving credit facility. Gastar also conveyed approximately 11,000 net non-core, nonproducing acres in Blaine and Major counties, Oklahoma, to the sellers. With the closing of the transaction, the AMI participation agreements with Gastar's AMI co-participant have been dissolved. As a part of the agreements underlying the acquisition, Gastar and Husky filed dismissals of a legal proceeding that Gastar had filed against Husky and a separate legal proceeding that Husky had filed against certain officers and directors of Gastar. 

Canaccord Genuity analyst Stephen Berman said, “GST is on the verge of becoming an almost pure Mid-Continent play with oily assets in some of the best emerging areas of Oklahoma. The company has had strong drilling results in the Hunton Limestone, and its first STACK well in the emerging Meramec play had a solid result. Monetization of the company's Marcellus and Utica shale assets in Appalachia, certain of which are on the market, would help enhance GST's financial position, with proceeds used to delever the balance sheet and/or be reinvested in the Mid-Con assets.”

Did You Like this Article? Get All the Energy Industry News Delivered to Your Inbox

Subscribe to an email newsletter today at no cost and receive the latest news and information.

 Subscribe Now

Whitepapers

The Time is Right for Optimum Reliability: Capital-Intensive Industries and Asset Performance Management

Imagine a plant that is no longer at risk of a random shutdown. Imagine not worrying about losing...

Going Digital: The New Normal in Oil & Gas

In this whitepaper you will learn how Keystone Engineering, ONGC, and Saipem are using software t...

Maximizing Operational Excellence

In a recent survey conducted by PennEnergy Research, 70% of surveyed energy industry professional...

Leveraging the Power of Information in the Energy Industry

Information Governance is about more than compliance. It’s about using your information to drive ...