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Storm Cat Energy Corporation to Acquire Powder River Basin Properties; Acquisition Immediately Accretive to Reserves, Production and Gathering Assets
Storm Cat Energy Corporation to Acquire Powder River Basin Properties; Acquisition Immediately Accretive to Reserves, Production and Gathering Assets.
About this update from Sama Resources Inc.
[{"type":"text","content":"\n\n\n\n\nCALGARY, Alberta and DENVER, July 18 /CNW/ -- Storm Cat\nEnergy Corporation (Amex: SCU; Toronto: SME) today announced that it has\nsigned a Definitive Purchase and Sale Agreement (PSA) with Bill Barrett\nCorporation (NYSE: BBG) to acquire approximately 25,200 gross acres (17,000\nnet acres) in the Powder River Basin coalbed methane (CBM) play in Campbell\nCounty, Wyoming for approximately US$30.65 million. The properties are\nlocated in and around Storm Cat's core Powder River operating area allowing\nthe Company to further capitalize on economies of scale and operating\nefficiencies. The acreage is approximately 81% undeveloped, over 90% of which\nis located on U.S. federal lands.\nWith this transaction, Storm Cat is acquiring approximately 10.2 billion\ncubic feet (Bcf) of proved reserves, 9.6 Bcf of probable reserves and 7.8 Bcf\nof possible reserves. Storm Cat's reserve quantity estimations were evaluated\nby Netherland Sewell & Associates (NSAI), a Dallas-based, independent\nreservoir engineering firm. Production from the acquired properties is\napproximately 6.6 million cubic feet per day (MMcf/d), (approximately\n3.0 MMcf/d net), of natural gas from 64 producing CBM wells, 46 of which will\nbe operated by Storm Cat.\nPro forma for the acquisition, Storm Cat will have approximately 19.8 Bcf\nof proved reserves, 13.8 Bcf of probable reserves and 7.9 Bcf of possible\nreserves as audited by NSAI. Gross production will be approximately\n11.6 MMcf/d (approximately 6.2 MMcf/d net), and acreage will be 39,235 gross\n(29,250 net) in the Powder River Basin.\nJ. Scott Zimmerman, President and Chief Executive officer said: \"These\nproducing Powder River Basin properties that we are acquiring are located in\nour core Northeast Spotted Horse operating area and will be immediately\naccretive to reserves, production and cash flow. Given the close proximity to\nour current Powder River CBM operations, we view this as a strategic fit to\nour asset base and an excellent way to provide future reserves and production\ngrowth in the area. Additionally, these properties can be developed using the\nmulti-seam completion technique that provides for increased recovery and\nreduced finding and development costs, ultimately maximizing the value of the\nasset. Acquisitions are a key component of our growth strategy. We will\ncontinue t...