Tuesday, July 3, 2012
Breitburn Energy Closes Permian Acquisition
BreitBurn Energy Partners L.P. closed on their Permian Basin Wolfberry acquisition. The price per acre metric was $47,826/acre. Of additional interest is that it was disclosed that CrownRock LP was the seller of one of the properties for $70 million. CrownRock is the working interest partner in all of Lynden Energy's projects.
Friday, May 11, 2012
Lynden Acreage Map
As you can see from the above map (LVL lands shown on map taken from Laredo's recent presentation), Lynden Energy Corp. has acreage located within the heart of the Wolfberry play with all of the large Wolfberry players surrounding them.
Given the two recent Permian Basin acquisition metrics of $38,600/acre and $47,826/acre, it's possible that Lynden could sell portions of their acreage for similar amounts. Here are valuations of each of Lynden's prospect areas based upon the recent transactions:
West Martin, 2,746 net acres @ $43,000/acre = $118 million
Wind Farms, 1,095 net acres @ $43,000/acre = $47 million
Tubb, 2,469 net acres @ $43,000/acre = $106 milllion
Lynden's Mitchell Ranch prospect area is within Devon Energy's delineation of the Cline Shale. Valuing that land at $5,000/acre equals $171 million (34,150 net acres).
Recent transactions are continually validating Lynden's land as viable Wolfberry acreage. With companies scrambling to assemble Wolfberry acreage positions, Lynden has a tremendous opportunity to capitalize!
Thursday, May 10, 2012
BreitBurn Energy Partners enters Permian Basin, another great Wolfberry comp! $47,826/acre!!!
BreitBurn Energy Partners L.P. signed two agreements to acquire Permian Basin Wolfberry properties. The combined price is approximately $220 million. The assets include:
- Net production of 2,100 boe/d (56% oil)
- Estimated proved reserves of approximately 9.5 mmboe
- Net acreage position of 4,600 acres
This is a great comp for Lynden Energy! The price per acre metric for these transactions is $47,826/acre and $104,762 per flowing boe/d.
- Net production of 2,100 boe/d (56% oil)
- Estimated proved reserves of approximately 9.5 mmboe
- Net acreage position of 4,600 acres
This is a great comp for Lynden Energy! The price per acre metric for these transactions is $47,826/acre and $104,762 per flowing boe/d.
Wednesday, May 2, 2012
Comments about Permian values and Cline
The latest issue of A&D Watch Weekly was released today and included some exciting comments. An article about Permian Basin values stated that there is still great deal price upside in the basin. The article states further that the Permian has a lot of room to go up due to the potential of several stacked payzones and that development is easier in the Permian than most other basins due to the ease of doing oil development in Texas and the few surface obstacles.
Ward Polzin, head of A&D for Tudor Pickering, Holt & Co. Securities, Inc., was quoted in the article saying that the Cline shale play is the "next new hot thing, no question about it," and that the "Cline is the real thing."
Monday's release regarding the Eagle Energy Trust acquisition and $38,600/acre valuation backs up the comments from the A&D article.
Ward Polzin, head of A&D for Tudor Pickering, Holt & Co. Securities, Inc., was quoted in the article saying that the Cline shale play is the "next new hot thing, no question about it," and that the "Cline is the real thing."
Monday's release regarding the Eagle Energy Trust acquisition and $38,600/acre valuation backs up the comments from the A&D article.
Monday, April 30, 2012
Eagle Energy announces Midland acquisition, $38,600/acre!!!
Eagle Energy Trust announced that they have entered into an agreement to acquire a 92.5% interest in 3,175 gross (2,937 net) acres of land near Midland. The purchase price is $113.4 million which equals a transaction price of $38,600/acre!
The asset includes 600 boe/d of production as of March and the company expects production to be approximately 1,000 boe/d by the end of 2012 (sound familiar...) Estimated proved plus probable reserves is approximately 10.2 mmboe.
"These long life, high netback assets represent a solid, low risk entry-point for Eagle into one of the most prolific and well-established oil weighted basins in North America. We believe that the Permian Basin will form a new strong core area of future operations for Eagle. It is one of North America's most productive oil-weighted basins and has demonstrated, on a recurring basis, the addition of new reserves horizons and enhanced exploitation of existing horizons in the multi-zone stacked pay resource," says Richard Clark, President and CEO of Eagle Energy Trust.
As a comparison, on April 4 Lynden Energy Corporation announced over 500 boe/d after royalty net production and has estimated end of 2012 production of approximately 1,000 boe/d. Most of this production is located within their West Martin and Wind Farms Wolfberry projects where Lynden owns 3,841 net acres and has 9.8 mmboe of proved plus probable reserves as of 6/30/11. The Eagle Energy Trust asset acquisition has very similar numbers to Lynden's West Martin and Wind Farms projects. Should one value Lynden's West Martin and Wind Farms acreage on a similar acreage metric as the Eagle Energy transaction, those lands alone would be valued at approximately $148 million which far exceeds the company's current market cap. After adding in Lynden's Tubb and Mitchell Ranch acreage, one can conclude that Lynden has incredible potential.
The asset includes 600 boe/d of production as of March and the company expects production to be approximately 1,000 boe/d by the end of 2012 (sound familiar...) Estimated proved plus probable reserves is approximately 10.2 mmboe.
"These long life, high netback assets represent a solid, low risk entry-point for Eagle into one of the most prolific and well-established oil weighted basins in North America. We believe that the Permian Basin will form a new strong core area of future operations for Eagle. It is one of North America's most productive oil-weighted basins and has demonstrated, on a recurring basis, the addition of new reserves horizons and enhanced exploitation of existing horizons in the multi-zone stacked pay resource," says Richard Clark, President and CEO of Eagle Energy Trust.
As a comparison, on April 4 Lynden Energy Corporation announced over 500 boe/d after royalty net production and has estimated end of 2012 production of approximately 1,000 boe/d. Most of this production is located within their West Martin and Wind Farms Wolfberry projects where Lynden owns 3,841 net acres and has 9.8 mmboe of proved plus probable reserves as of 6/30/11. The Eagle Energy Trust asset acquisition has very similar numbers to Lynden's West Martin and Wind Farms projects. Should one value Lynden's West Martin and Wind Farms acreage on a similar acreage metric as the Eagle Energy transaction, those lands alone would be valued at approximately $148 million which far exceeds the company's current market cap. After adding in Lynden's Tubb and Mitchell Ranch acreage, one can conclude that Lynden has incredible potential.
Horizontal Wolfcamp article, etc.
There was a nice article on the Horizontal Wolfcamp published by Oil and Gas Investor magazine. It's worthwhile reading for those interested. Here is a link to the article which is located on Approach Resources website: "Horizontal Wolfcamp"
Also, Energen released their Q1 2012 results last week. Here are a couple of comments from James T. McManus, II, the company's Chairman and CEO:
"As you know there is growing excitement about the horizontal Wolfcamp and Cline potential in the Midland Basin. We currently are participating as a non-operated partner with Laredo in the horizontal Wolfcamp well near our Glasscock County acreage, the early results are encouraging and we’re pleased to be getting some data points that will help us to better assess the potential on our acreage."
"We also are closely monitoring Cline activity in the Midland Basin, obviously, a success of either this plays on our acreage could impact our future drilling plant in the Midland Basin."
Here is the link to the transcript as posted on Seeking Alpha: "Energen Earnings Call transcript"
Also, Energen released their Q1 2012 results last week. Here are a couple of comments from James T. McManus, II, the company's Chairman and CEO:
"As you know there is growing excitement about the horizontal Wolfcamp and Cline potential in the Midland Basin. We currently are participating as a non-operated partner with Laredo in the horizontal Wolfcamp well near our Glasscock County acreage, the early results are encouraging and we’re pleased to be getting some data points that will help us to better assess the potential on our acreage."
"We also are closely monitoring Cline activity in the Midland Basin, obviously, a success of either this plays on our acreage could impact our future drilling plant in the Midland Basin."
Here is the link to the transcript as posted on Seeking Alpha: "Energen Earnings Call transcript"
Friday, April 20, 2012
Another article on the Cline Shale
An article was written on the Cline shale by Nissa Darbonne. Here are a couple of quotes from it:
"Laredo Petroleum Inc. chairman and chief executive officer Randy Foutch says the Cline shale 'is a world-class shale'."
"The Cline is less known (but) we know a lot about it,” Foutch says. Across at least 80 miles in the Midland Basin, the formation is fairly unchanging north to south, he adds."
"Laredo Petroleum Inc. chairman and chief executive officer Randy Foutch says the Cline shale 'is a world-class shale'."
"The Cline is less known (but) we know a lot about it,” Foutch says. Across at least 80 miles in the Midland Basin, the formation is fairly unchanging north to south, he adds."
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