Penn Virginia Corporation (NYSE:PVA) announced today that it has closed an acquisition for $47.9 million in the Arkoma Basin of eastern Oklahoma primarily targeting Hartshorne coalbed methane (CBM), with upside potential in the Woodford and Caney Shales.
Transaction Highlights -- Estimated proved reserves of 18.8 billion cubic feet of natural gas equivalent ("Bcfe") and 14.8 Bcfe of probable and possible reserves; -- Current net production of approximately 3.1 million cubic feet of natural gas equivalent per day; -- Approximately 22,700 gross (15,800 net) acres located adjacent to PVA's Riverbend horizontal Hartshorne CBM project in McIntosh and Hughes Counties, Oklahoma with approximately 80 potential CBM locations; and -- Potential upsides include reserves associated with the Woodford and Caney Shales (approximately 13,700 prospective net acres), shallow conventional reservoirs, and downspaced horizontal Hartshorne CBM drilling.
The acquisition was funded with cash on hand and borrowings under PVA's revolving credit facility.
A. James Dearlove, President and Chief Executive Officer, stated, "Located adjacent to our existing Riverbend project, this acquisition has attractive transaction economics and provides us with additional exposure to potential upside opportunities. The acquisition is consistent with our growth strategy and also supports our belief that the Mid-Continent region contains numerous attractive expansion opportunities."
Headquartered in Radnor, PA and a member of the S&P SmallCap 600 Index, Penn Virginia Corporation (NYSE:PVA) is an independent natural gas and oil company focused on the exploration, acquisition, development and production of reserves in onshore regions of the U.S., including the Appalachian Basin, the Cotton Valley play in east Texas, the Selma Chalk play in Mississippi, the Mid-Continent region and the Gulf Coast of Louisiana and Texas. PVA also owns approximately 82 percent of Penn Virginia GP Holdings, L.P. (NYSE:PVG), the owner of the general partner and the largest unit holder of Penn Virginia Resource Partners, L.P. (NYSE:PVR), a manager of coal properties and related assets and the operator of a midstream natural gas gathering and processing business. For more information about PVA, please visit PVA's website at www.pennvirginia.com.
Certain statements contained herein that are not descriptions of historical facts are "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Because such statements include risks, uncertainties and contingencies, actual results may differ materially from those expressed or implied by such forward-looking statements. These risks, uncertainties and contingencies include, but are not limited to, the following: whether or not the acquisition will be cash flow accretive; whether or not PVA's reserve and production estimates are accurate; integrating and managing the newly acquired oil and gas assets with PVA's existing oil and gas exploration and production business; competition from other oil and gas exploration and production companies; pipeline availability; potential equipment malfunction and repair delays; weather related delays; the legislative and regulatory environment; and political and economic conditions, including the impact of potential terrorist acts.
Additional information concerning these and other factors can be found in PVA's press releases and public periodic filings with the Securities and Exchange Commission, including PVA's Annual Report on Form 10-K for the year ended Dec. 31, 2006 and subsequently filed interim reports. Many of the factors that will determine PVA's future results are beyond the ability of management to control or predict. Readers should not place undue reliance on forward-looking statements, which reflect management's views only as of the date hereof. PVA undertakes no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.
Source: Penn Virginia Corporation
Released August 30, 2007