Minnesota firm buys wells being drilled by Oklahoma operators in North Dakota

 

Minnesota-based Northern Oil and Gas, Inc. is acquiring some Williston Basin wells being drilled by Oklahoma’s Continental Resources Inc. and WPX Energy.

It is described as a $3.5 million cash deal and 2.95 million shares of Northern Oil and Gas in exchange for 400 net acres, 0.7 net producing wells, 1.9 net wells in process and 1.0 net undrilled locations from undisclosed sellers.

These assets are primarily operated by Conoco, Continental Resources and WPX Energy and located in McKenzie, Mountrail and Dunn counties. The bulk of the wells in process are expected to come online in the summer of 2021.

In addition to the cash and shares, more consideration of up to 450,000 shares shall be paid to the seller receiving equity consideration, assuming full operation of the Dakota Access Pipeline over a twelve-month period. These transactions are expected to close within 60 days.

“We continue to add to our core inventory,” commented Adam Dirlam, Chief Operating Officer of Northern. “Record levels of wells-in-process should drive strong volumes, and improve upon our return on capital employed metrics in 2021 and beyond.”

In making the announcement, Northern said it acquired the properties on an unhedged basis and based on recent strip pricing, it expects to payback the acquisition costs within approximately 3 years.

The acquisition will add to Northern’s holdings which are primarily in the Williston Basin Bakken and Three Forks play in North Dakota and Montana.

Click here for more details of the announcement.

Source: BusinessWire

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