PrimeWest Energy paying $330M for U.S. oil and gas assets
PrimeWest Energy Trust (TSX:PWI.UN) is paying $300 million US, or about $330 million Cdn, for oil and gas assets in Montana, North Dakota and Wyoming.
With the deal expected to close by July 6, Calgary-based PrimeWest said Monday it will use existing credit lines plus a supplementary credit line of $250 million to finance the move.
“This acquisition establishes a new operating area for PrimeWest within the Williston Basin, with significant secondary and tertiary development potential,” the company said in a release. The seller or sellers were not identified.
Current production from the properties is about 3,200 barrels of oil equivalent per day, about 94 per cent in crude oil.
The major fields included in the acquisition are Flat Lake, Dwyer and Goose Lake in Montana; Rival, Grenora, Alexander, Wiley, Glenburn and Sherwood in North Dakota; and Rocky Point in Wyoming.
PrimeWest said it plans to invest about $23 million of capital in the area for the rest of 2006 and several drilling opportunities have been identified. PrimeWest’s total capital expenditures this year are now forecast to be about $300 million.