The highly coveted STACK and SCOOP areas have caught the interest of an Austin, Texas independent oil and natural gas company with ties to Oklahoma’s storied past.
Jones Energy, Inc. announced on Thursday that it signed a definitive purchase and sale agreement to acquire approximately 18,000 acres primarily in southern Canadian and northern Grady counties in Oklahoma for $136.5 million. The company anticipates the transaction will close by the end of September.
“This transformative transaction gives Jones Energy a scalable footprint in one of the most coveted resource plays in the U.S.,” said Jonny Jones, Founder, Chairman, and CEO. “We identified this area as a primary target for Jones over a year ago and are thrilled to be acquiring assets in the heart of the STACK/SCOOP play. The acreage we are acquiring is highly operated, which puts us in a solid position to create value through our best-in-class Midcontinent operations. We truly believe that our acreage has the best attributes of both the STACK and the SCOOP plays based on our in-depth geological analysis. Recent well results on our footprint are on par with the best in the play.”
Approximately 70% of Jones Energy’s STACK/SCOOP acreage is operated with an average working interest of nearly 50%. The implied acreage value is close to $7,600 per net acre. The company has identified multiple target zones to provide significant stacked pay potential.
In a separate announcement, Jones Energy said it will fund all or a portion of the acquisition with a public offering of 14 million shares of its Class A common stock. The underwriters will have an option to purchase up to an additional 2.1 million shares.
The company also announced a separate public offering of 1 million shares of its Series A Perpetual Convertible Preferred Stock at an issue price of $50 per share with underwriters having an option to purchase up to an addition 150,000 shares.
“This acquisition high-grades our Midcontinent position and significantly enhances the growth outlook for Jones Energy in 2016 and beyond,” said Jones.
The company has working interests primarily in the Anadarko and Arkoma basins of Texas and Oklahoma but made headlines in 1996 when it drilled the first horizontal well in the Texas Panhandle.
Jones Energy is also a third generation oil and gas company. The family’s history dates back to 1923 when A.V. Jones worked with Oklahoma’s quintessential wildcatter, E. W. Marland, at Conoco’s predecessor, Marland Oil Company.
