Houston-based Linn Energy LLC will spend $90.5 million to purchase some oil and natural gas properties in the Texas Panhandle that add more than 36,00 gross acres and 300 producing wells to its existing assets in the region. The seller was not disclosed.
Net proven reserves of the properties total 7 MMboe. The assets are located mostly in Hutchinson, Moore, Carson and Potter counties in Texas. In December, Linn made its initial foray into the Panhandle, paying $415 million to acquire some assets from a privately held Texas-based producer (see Daily GPI, Dec. 15, 2006).
"These assets are complementary to our existing position in the Texas Panhandle, and the transaction is consistent with our strategy of growing our presence in and around our core areas of operation," said CEO Michael C. Linn.
The acquisition is expected to close by the end of June, and it will be financed with borrowings under the partnership's existing credit facility. In addition, Linn expects the acquisition to provide an increase in the borrowing base under its credit facility to $765 million from $725 million. The acquisition is expected to be immediately accretive to distributable cash flow per unit.
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