Contango Oil & Gas of Ft. Worth, TX is paying $67 million to buy all the oil and gas assets owned by ConocoPhillips in Wyoming’s Wind River Basin as the company continues to expand its holdings in that state.
The acquisition has net production run rate of approximately 78 Mmcf a day and the assets include 446 billion cubic feet of proved, developed and producing reserves.
The acquisition is expected to increase Contango’s run rate production by approximately 57% in the third quarter, and the company sees a 5% per year production decline over the next five years.
“This is a huge, conventional gas field with low decline, purchased at an attractive valuation,” said Contango CEO Wilkie S. Colyer. “We are intimately familiar with the area via assets acquired in the MCEP and Silvertip transactions, and we have the right team to maximize the value of these mature, low decline, and conventional properties.”
“Our previously announced merger with Independence Energy with assets also in the Rockies was designed to accelerate our acquisition pace rather than slow it down, and this transaction is a perfect example of that,” Colyer said.