Cabot Buys Texas Oil Properties
Cabot Oil and Gas will buy 25,000 acres of oil-producing properties in east Texas, as well as production infrastructure, for $602.8 million.
The purchase was from a private party, Cabot said, and is near existing Cabot properties in the Minden area.
Cabot estimated the purchased fields have proved reserves of 176 billion cubic feet of equivalent.
“We view this deal positively, as we believe the proved producing assets lower the risk profile by providing a cash flow stream versus solely an acreage acquisition,” said Goldman Sachs analyst Brian Singer. “We see further upside if Cabot can grow production at attractive finding and development costs over the next one to two years.”
Cabot shares rose $6.29, or 10.7 percent, to $65.36 in afternoon trading. Earlier they hit a new high of $65.50.