Gondola Resources Acquires Sandridge's North Park Basin Assets
Denver-based Gondola Resources LLC has entered into a Sale and Purchase Agreement (SPA) with NYSE-listed SandRidge Energy Inc. to acquire certain assets located in the North Park basin in Colorado, for a total cash consideration of US$47 million, subject to post-closing adjustments.
The total consideration consists of an initial cash deposit of US$3 million, and an additional cash consideration of US$44 million payable upon the closing of the agreement.
The assets acquired include approximately 93,000 net acres located in Jackson County, Colorado, and primarily target the Niobrara Shale play. The properties contain 53 oil producing wells and 900 undeveloped probable horizontal lateral locations. The assets acquired have Proved (1P) Reserves of 28.5 million barrels of oil (MMbbls) as of December 31, 2019, with average daily production of approximately 2,206.5 barrels of oil per day (bbls/d) during Q3-2020.
“We believe this transaction significantly enhances shareholder value. It monetizes an asset the value of which, we believe, has not been adequately reflected in our stock price and which had become increasingly non-core with the company’s shift to a cash optimization-focused strategy,” said Carl Giesler, President & CEO of SandRidge Energy.
Gondola Resources is backed by equity commitments from Fulcrum Energy Capital Funds, and is primarily engaged in exploration and development activities in the Rockies.
Oklahoma-based SandRidge’s principal focus is on developing high-return, growth-oriented projects in the U.S. Mid-Continent and Niobrara shale.
The transaction is subject to customary closing conditions, including the receipt of regulatory approvals, and is expected to close during Q1-2021.
Jefferies is acting as financial advisor to SandRidge.