Scoop & Stack

Chaparral Energy Announces Bolt-on STACK Play Acreage Acquisition in Kingfisher County, Oklahoma

OKC based Chaparral Energy, Inc. announced today that it has entered into a definitive purchase agreement to acquire acreage in Kingfisher County, Oklahoma, from a private seller for $60 million in cash Highlights of the acquisition include:

  • Acquiring 7,000 contiguous net acres in the core of the black-oil window of the STACK Play in Kingfisher County
    • The acreage is 100 percent held by production and will provide Chaparral with an 87 percent working interest
  • Increasing Chaparral’s core acreage in Kingfisher County by 28 percent, which increases the company’s total STACK Play acreage to approximately 117,000 net acres
  • Adding more than 200 horizontal drilling locations in the Meramec and Osage formations
  • Attractive purchase price of approximately $8,500 per acre compared to other recent STACK transactions.

“We are particularly excited about this acquisition due to its location adjacent to our existing operations in the sweet spot of this highly productive play,” said Chaparral Chief Executive Officer Earl Reynolds. “Our understanding of the rock, extensive experience in the area and access to existing infrastructure will allow us to maximize the value of this core area.”

In addition to the acquisition, the company also closed on a new $400 million credit facility on December 21, 2017, with an initial borrowing base of $285 million, which represents a $60 million increase compared to its previous borrowing base. Chaparral plans to use the credit facility to finance the STACK acquisition, which is expected to close in January 2018.

As announced in late November, the company recently completed the sale of its EOR assets and used those proceeds to fully repay the outstanding $149.2 million balance on its term loan, as well as pay down a portion of its outstanding credit facility borrowings. Chaparral anticipates its outstanding borrowings under the new credit facility at the end of 2017 will be $127 million.

“This bolt-on acquisition further enhances our outstanding STACK position and our increased borrowing base serves as a testament to the quality of our assets,” said Reynolds. “Given our exceptional position within the play, as well as our strong balance sheet, Chaparral is well positioned to continue to drive long-term growth and create value for our shareholders.”

 

 

Compiled and Published by GIB KNIGHT

Gib Knight is a private oil and gas investor and consultant, providing clients advanced analytics and building innovative visual business intelligence solutions to visualize the results, across a broad spectrum of regulatory filings and production data in Oklahoma and Texas. He is the founder of OklahomaMinerals.com, an online resource designed for mineral owners in Oklahoma.

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