Gastar Exploration Inc. (NYSE American: GST) (“Gastar”) announced today that it has completed the previously announced sale of its interest in the West Edmond Hunton Lime Unit (“WEHLU”) for $107.5 million, adjusted for the effective date of October 1, 2017 and resulting in net cash proceeds of $98.8 million at closing. The WEHLU encompasses only the Upper and Lower Hunton producing formations and is primarily located in Oklahoma and Logan counties, Oklahoma.
Gastar acquired this interest back in 2013, acquiring a 98.3% working interest (80.5% net revenue interest) in 24,000 acres of the West Edmund Hunton Lime Unit for the then purchase price of $187.5 million.
Michael A. Gerlich, Gastar’s Senior Vice President and Chief Financial Officer, commented, “The completion of this asset divestiture allows Gastar to redirect funds from a non-core asset to the drilling of operated Osage and Meramec wells on our 67,000 net surface acres in our core STACK position. This level of activity will allow us to continue to both delineate our acreage for the Osage and Meramec formations as well as hold our acreage by production.”
WEHLU (West Edmond Hunton Lime Unit) is comprised of lands situated in Kingfisher, Oklahoma, Logan, and Canadian Counties, Oklahoma as established under the rules of the Oklahoma Corporation Commission, dated July 29, 1947 by Philips Petroleum. Peak production was reached in September 1945 at 87,500 bbls/day.
For a snapshot of the history of this unit, take a look at the “The History of WEHLU from Conventional to Unconventional” by Galen Miller, Sr. Geologist Gastar Exploration.
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.