Acquire

Costar Midstream LLC and Energy Spectrum Partners VI (ESP VI) have partnered to acquire gas processing assets in the Granite Wash area of the Texas and Oklahoma Panhandle. Costar said it plans to build a “sizable” midstream business focusing on gathering and processing assets that can be acquired and developed. This is the first portfolio investment for ESP VI, which is a $998.7 million private equity fund focused on midstream infrastructure. Energy Spectrum has more than $2.3 billion of capital under management. ESP VI, the firm’s most recent fund, closed recently with commitments of $998.7 million. Recently privately held Crestwood Midstream Partners LP completed an acquisition of midstream assets in the Granite Wash (see Shale Daily, April 5).

Chesapeake Energy Corp.’s shift to balance its natural gas-weighted portfolio required a lot of spending last year — an estimated $4.7 billion — to acquire liquids-rich property, but the risky outlay already is proving its worth, CEO Aubrey McClendon said this week.

Australia’s Eureka Energy Ltd. recently agreed to acquire 3,975 net acres in Burleson and Washington counties, TX, within the eastern liquids-rich fairway of the Eagle Ford Shale. The acreage potentially is within the gas condensate window as well, the company said.

Paramount Resources Ltd. has agreed to acquire Calgary-based junior independent ProspEx Resources Ltd., the companies said Friday. Under the agreement, ProspEx shareholders may elect to receive either C$2.40 in cash or 0.07162 of a Paramount Class A common share per ProspEx share, subject to pro ration, such that 2,000,000 Paramount shares will be issued. The transaction values ProspEx at $186 million, including net debt and transaction costs. ProspEx, which was formed in 2004 by the reorganization of Esprit Exploration Ltd. (see Daily GPI, Oct. 5, 2004), owns rights to 90,000 net undeveloped acres in West Central Alberta and the Deep Basin. Assuming approval by regulators and ProspEx shareholders, the deal is expected to be completed by the end of May. The ProspEx board has approved the deal and will recommend that shareholders approve it as well, the company said.

Japan’s giant trading house Marubeni Corp. last week struck a $270 million deal to acquire a chunk of Marathon Oil Corp.’s gas-rich acreage in the Denver-Julesburg (DJ) Basin.

Tennessee Gas Pipeline received regulatory approval Monday to use its facilities to export Marcellus Shale gas through its facilities at the U.S.-Canada border.

Recovery Energy Inc. announced Monday that it has closed on a $12.3 million cash-and-stock deal to acquire oil and gas leases on 8,060 net acres from Houston-based Wapiti Oil & Gas LLC. The leasehold is located primarily northwest of the prolific Silo field in Laramie County, WY. The Wapiti sale follows Denver-based Recovery’s acquisition last month of approximately 1,700 acres in Weld County, CO and about 6,600 net acres in Goshen County, WY from various private individuals for $1.9 million in cash and stock. The combined acquisitions bring Recovery’s holdings in the Denver-Julesburg Basin to 148,000 gross acres (134,000 net acres).

The partners behind Kitimat LNG plan to acquire the 50% interest in Pacific Trail Pipelines LP they don’t already own from Pacific Northern Gas Ltd. (PNG) for $50 million. The deal is intended to support export of gas from the Horn River Basin and other Western Canada plays as liquefied natural gas (LNG) to Asian markets. Apache Canada Ltd. and EOG Resources Canada Inc. said they will pay PNG $30 million on closing, which is expected by the end of February, and make a second payment of $20 million when the partners decide to proceed with construction of the Kitimat LNG export facility at Bish Cove, BC (see NGI, Jan. 3).

The partners behind Kitimat LNG plan to acquire the 50% interest in Pacific Trail Pipelines LP they don’t already own from Pacific Northern Gas Ltd. (PNG) for $50 million. The deal is intended to support export of gas from the Horn River Basin and other Western Canada plays as liquefied natural gas (LNG) to Asian markets.