Laramie Energy to buy Piceance basin assets

Piceance Energy LLC, doing business as Laramie Energy Co. and financially backed by Par Pacific Holdings Inc., has agreed to acquire certain properties in the Piceance basin of Colorado for $157.5 million. 

The assets comprise 89 MMcfed of existing production during November, 283 bcfe of proved developed producing reserves as of November, and more than 53,000 net operated acres and more than 18,000 net nonoperated acres.

Par Pacific says the assets’ estimated proved reserves total 541 bcfe; proved and probable reserves total 1.2 tcfe; and proved, probable, and possible reserves total 5 tcfe each as of November.

The acreage has 5,000 drilling locations, with more than 90% of operated acreage held by production. Pro forma for the deal, Laramie will have 140 MMcfed of production for the month of November.

The deal also includes 195 miles of gas gathering lines with 21,000 hp of owned compressors. A significant portion of the operations acquired is directly adjacent to existing Laramie operations with the potential for meaningful cost savings upon consolidation, Par Pacific notes. 

The deal is expected to close on or before Mar. 1, 2016. As part of the financing, Houston-based Par Pacific's ownership interest in Laramie is expected to increase from 32.4% to 42.3% as a result of its $55 million common equity investment. 

Piceance Energy in September entered into a joint venture with Wexpro Co., a subsidiary of Questar Corp., to develop gas in the basin (OGJ Online, Sept. 23, 2015).

The Piceance currently produces gas both from the Mesaverde tight gas sand formation, developed vertically; and from the Mancos shale formation, which is being developed both vertically and horizontally.

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


Shell Leverages Data to Transform from Reactive to Predictive Operations

This 6-page report describes how Shell engaged in a massive project with OSIsoft to transform the...

Selection, Use, Care and Maintenance of FR Clothing

For industries operating in an inherently dangerous environment, the importance of selecting the ...

Evolution or Revolution: IT / OT convergence means a world of possibilities

The oil and gas industry is experiencing a rapid paradigm shift in regards to digital transformat...

Predict, Prescribe, Profit: Creating a World that Doesn't Break Down

What are you doing to reduce unplanned downtime at your plant? Equipment breakdowns and process i...