In the Bakken oil play of North Dakota where Oklahoma’s Continental Resources and founder Harold Hamm have made a fortune, a new operator has acquired production in the Williston Basin and cut a deal with Continental.
Minneapolis-based Northern Oil and Gas Inc. announced it has entered into a definitive agreement to acquire the assets operated by Whiting Petroleum and Continental Resources. It is a deal involving $5 million in cash and 500,000 shares of Northern common stock with closing anticipates around the first of August.
Production of the assets averages 165 barrels of oil equivalent a day while the purchase includes more than 1,900 acres in the Pronghorn area of the Williston Basin.
“This acquisition is another indicator of our continued success in pursuing accretive acquisitions and our competitive advantage in the Williston Basin,” commented Northern’s Chief Executive Officer, Mike Reger. “Our capital allocation process is driving strong cash flow growth. We continue to see numerous acquisition opportunities, while at the same time we continue improving our balance sheet and reducing our cash expenses.”
The sale agreement will result in a debt reduction of $10 million value of Notes for Northern Oil and Gas in exchange for common stock. Combined with other exchange transactions announced in the past two weeks, Northern has agreements to retire $53.8 million of its remaining notes.
