Panhandle Oil & Gas Acquires Additional Acreage in Oklahoma and Texas
NYSE-listed Panhandle Oil & Gas Inc. has entered into two separate purchase and sale agreements (PSAs) with Oklahoma-based Red Stone Resources LLC to acquire approximately 795 net mineral and royalty acres in the SCOOP play in Oklahoma and the Haynesville play in Texas for a total consideration of US$6.9 million.
Panhandle will acquire the SCOOP play assets for a consideration of US$2.4 million, comprising an initial cash consideration of US$2.15 million and an additional stock consideration of US$250,000, payable by way of issuance of common shares of the company. The company will also acquire the Haynesville play assets for a total consideration of US$4.53 million, consisting of an initial cash consideration of US$4.28 million and an additional stock consideration of US$250,000.
The assets acquired have total proved (1P) reserves of approximately 7.4 billion cubic feet of gas equivalent (Bcfe) as of June 1st, 2020, of which approximately 87% is gas. The SCOOP play assets hold approximately 286 net royalty acres in the Springboard area in Grady County, Oklahoma, with a current net production of around 18 barrels of oil equivalent per day (boe/d). The Haynesville play assets hold approximately 509 net acres in the Harrison, Panola, and Nacogdoches Counties, Texas, with a current net production of around 1,032 thousand cubic feet of gas per day (Mcf/d).
“This is an outstanding acquisition for Panhandle that fits very well with our stated strategy to grow the company on an accretive basis. These assets are a nice blend of producing properties, near-term development opportunities and upside potential in core areas with active drilling programs by high quality and well capitalized operators. It also marks our entry into the Haynesville play of East Texas and Louisiana, which we believe has significant potential and provides good development visibility,” said Panhandle’s President & CEO, Chad Stephens.
Oklahoma-based Panhandle Oil & Gas is a mineral rights and royalty company which currently holds interests in mineral acreage and producing oil & gas properties located across Arkansas, Colorado, Florida, Indiana, Kansas, Montana, North Dakota, New Mexico, Oklahoma, South Dakota, and Texas.
Red Stone Resources is a mineral rights company based in Edmond, Oklahoma, and currently holds a portfolio of mineral and leasehold rights in the Anadarko, Appalachian, Haynesville, and Permian Basins in the United States.
The transaction is subject to customary closing conditions, and is expected to be completed in Q1-2020, with an effective date of June 1st, 2020.