Linn Energy is an independent oil and natural gas development company, with approximately 1.7 trillion cubic feet equivalent of proved reserves in producing U.S. basins
Linn Energy to buy oil and gas properties from Plains Exploration for $600 mln
4th Nov 2011, 1:27 pm by Brad Lemaire
Linn Energy (NASDAQ:LINE) said Friday it has inked a definitive agreement to buy mid-continent oil and gas properties from Plains Exploration & Production Company (NYSE:PXP) for $600 million in a move that will double its Granite Wash inventory.
The deal should close on December 31 and will be funded with internally-generated cash flow and proceeds from its revolving credit loan, Linn said.
The transaction will double Linn’s current inventory of horizontal drilling locations to more than 400 in the Granite Wash. The Texas Panhandle properties being sold to Linn had sales volumes of about 84 million cubic feet of gas equivalent a day, and 263 billion cubic feet of estimated proved reserves at the end of 2010.
In a statement, chief executive Mark Ellis said: "This acquisition represents substantially all of Plains’ assets in the
Mid-Continent region including mature stable assets and an outstanding position in the Granite Wash."
"We expect to yield significant operational efficiencies in the Granite Wash as we leverage our pad drilling techniques, simultaneous-operations processes, and recently built gas gathering and water handling infrastructure."
The Houston, Texas-based oil and gas company saw its stock slump one cent, or 0.03 percent, to $37.12 a share, while Plains Exploration & Production climbed 6.39 percent to $35.47 a share Friday afternoon.
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