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.
HIGHLIGHTS
-
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
MANAGEMENT COMMENT
“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.”
ACQUISITION
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.
More information about Northern Oil and Gas, Inc. can be found at www.NorthernOil.com.
SAFE HARBOR
This press release contains forward-looking statements regarding future
events and future results that are subject to the safe harbors created
under the Securities Act of 1933 (the “Securities Act”) and the
Securities Exchange Act of 1934 (the “Exchange Act”). All statements
other than statements of historical facts included in this release
regarding Northern’s financial position, business strategy, plans and
objectives of management for future operations, industry conditions, and
indebtedness covenant compliance are forward-looking statements. When
used in this release, forward-looking statements are generally
accompanied by terms or phrases such as “estimate,” “project,”
“predict,” “believe,” “expect,” “continue,” “anticipate,” “target,”
“could,” “plan,” “intend,” “seek,” “goal,” “will,” “should,” “may” or
other words and similar expressions that convey the uncertainty of
future events or outcomes. Items contemplating or making assumptions
about actual or potential future sales, market size, collaborations, and
trends or operating results also constitute such forward-looking
statements.
Forward-looking statements involve inherent risks and uncertainties, and
important factors (many of which are beyond Northern’s control) that
could cause actual results to differ materially from those set forth in
the forward-looking statements, including the following: Northern’s
ability to consummate any transaction with its bondholders, including
the final terms of any such transaction, which could result in the
issuance of a significant amount of equity, changes in crude oil and
natural gas prices, the pace of drilling and completions activity on
Northern’s properties, Northern’s ability to acquire additional
development opportunities, changes in Northern’s reserves estimates or
the value thereof, general economic or industry conditions, nationally
and/or in the communities in which Northern conducts business, changes
in the interest rate environment, legislation or regulatory
requirements, conditions of the securities markets, Northern’s ability
to raise or access capital, including as a condition to any transaction
with its bondholders, changes in accounting principles, policies or
guidelines, financial or political instability, acts of war or
terrorism, and other economic, competitive, governmental, regulatory and
technical factors affecting Northern’s operations, products, services
and prices.
Northern has based these forward-looking statements on its current
expectations and assumptions about future events. While management
considers these expectations and assumptions to be reasonable, they are
inherently subject to significant business, economic, competitive,
regulatory and other risks, contingencies and uncertainties, most of
which are difficult to predict and many of which are beyond Northern’s
control. Northern does not undertake any duty to update or revise any
forward-looking statements, except as may be required by the federal
securities laws.
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Northern Oil and Gas
Brandon Elliott, 952-476-9800
Investor
Relations
investorrelations@northernoil.com
Source: Northern Oil and Gas, Inc.
Released April 26, 2018