MINNEAPOLIS–(BUSINESS WIRE)–Northern Oil and Gas, Inc. (NYSE American: NOG) today announced that it has entered into a definitive agreement to acquire producing assets and acreage in the core of the Williston Basin in North Dakota for total consideration of $40 million in cash (subject to adjustments) and 6 million shares of Northern common stock. The company anticipates the acquisition will close in approximately 40 days, and will have an effective date of January 1, 2018.
- February estimated production of 1,380 barrels of oil equivalent per day
- Includes 1,319 net acres in the core of the Williston Basin that are 100% held by production and have an average net revenue interest of 86%
- Acquiring an estimated 8.2 net future drilling locations that Northern expects will generate average EURs over 1 million barrels of oil equivalent
- Northern expects the acquired properties to generate approximately $19 million of cash flow from operations in 2018
“This acquisition solidifies our position as the natural consolidator of non-operating working interests in the Williston Basin. It brings with it outstanding future drilling locations and current production, without additional general and administrative costs, demonstrating the scalability of our business model,” commented Northern’s Interim President, Brandon Elliott. “This acquisition shows not only our ability to execute on our long term consolidation strategy but also our ability to execute on accretive deals in the best part of the Bakken fairway.”
Northern has entered into a definitive purchase agreement with Salt Creek Oil and Gas, LLC, a subsidiary of Deutsche Rohstoff AG, to acquire oil and gas properties in the core of the Williston Basin in North Dakota. The acquisition is expected to close in approximately 40 days, subject to typical conditions, with an effective date of January 1, 2018. Included in the assets are 86 gross (6.5 net) wells currently producing, drilling or awaiting completion and an estimated 137 gross (8.2 net) wells of future drilling inventory. Operators of the assets include Hess Corporation, Whiting Petroleum, Conoco Phillips, and Statoil.
A map of the acquired acreage can be found at: www.northernoil.com/saltcreek.
Total consideration at closing will include $40 million of cash plus reimbursement of capital for wells in process (subject to customary adjustments) and 6 million shares of Northern common stock. Salt Creek will be subject to a six month post-closing lockup on the shares, with limited exceptions. The agreement contains a mechanism for potential additional cash consideration paid at the end of the six-month lockup period if Northern’s common stock is trading below $2.00 per share. However, no additional consideration will be paid if Northern’s common stock closes at or above $2.00 per share for any five consecutive trading days prior to that time.
ABOUT NORTHERN OIL AND GAS
Northern Oil and Gas, Inc. is an exploration and production company with a core area of focus in the Williston Basin Bakken and Three Forks play in North Dakota and Montana.