PEDEVCO Corp. (dba Pacific
Energy Development), which has a growing domestic oil and gas footprint
spanning the Eagle Ford (4% WI in some 1.3k plus producing acres),
Mississippian Lime (98% WI in some 6.7k plus net acres with drilling slated for
early this year) and Niobrara (27.13% WI on some 10k gross acres in Colorado’s
Denver-Jules Basin), as well a small percentage JV interest in a Chinese rare
earth company operating in Inner Mongolia, reported some big news today as
entry was announced into a definitive agreement to acquire an interest in
another big chunk of the DJ Basin from an independent oil and gas company.
On the table is a payment of
roughly $30M in cash by PED (effective Dec 1, 2013) on a deal that is expected
to close sometime around the middle of this February. PED stands to gain a
considerable interest in 40 wells as a result of the deal, greatly expanding
their DJ Basin footprint by just over 28.7k net acres (28,241 acres in Weld
County and the other 486 in Morgan County), some 2.2k net acres of which is in
the extremely prolific Wattenberg Area. With 11 of the wells in the package
operated (14 non-operated) and the most recent production vector showing around
400 net BOEPD (Sept. 2013), this move will bump PED up into a whole new category
as a major Niobrara player.
President and CEO of PED,
Frank Ingriselli, a 30-year energy industry veteran with wide ranging
experience across the E&P spectrum in multiple regions, hailed this over
tenfold increase in the company’s DJ Basin acreage footprint as a superb
opportunity to bolster the company’s daily production figures. Access to the
exciting Wattenberg Area is another key aspect of the deal according to
Ingriselli and he hinted that the company’s experience in the Niobrara play
during recent years would not go to waste when it comes to developing these new
assets.
The company also has a nice
little asset down in Matagorda County, Texas (North Sugar Valley) now, as well
as having previously announced entry into an agreement to pick up a key (34%)
interest in some 380k producing acres in Kazakhstan’s Pre-Caspian Basin (East
Zhagabulak field). Today’s announcement about a new addition in the DJ Basin is
clear indication of how aggressive the company has become with regard to
expanding their production envelope and investors can get the inside baseball
during tomorrow’s (Jan 23) conference call at 1:30 p.m. PST (4:30 p.m. EST)
using the toll-free domestic line (877-407-6914) or via (201-493-6709) for
international calls, an archive of which will be available for 90 days
thereafter on the company’s IR page.
PED is serious about energy
development and their footing in Asia, where test results from an additional
appraisal well on the sizeable East Zhagabulak field recently (Dec 11) affirmed
the tremendous upside potential of this key piece of the company’s portfolio,
provides a nice backdrop for their domestic activities and makes the stock
particularly attractive. It will pay to keep an eye on this latest acquisition
as things develop and the conference call tomorrow should be a feast for those
looking to get in on the action.
For more info on Pacific
Energy Development, visit www.PacificEnergyDevelopment.com
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