(By Balaseshan) Magnum Hunter Resources Corp. (NYSE: MHR) said its subsidiary Bakken Hunter LLC has agreed to buy existing wells and about 20,000 net Williston Basin lease acres located in Divide County, North Dakota from Samson Resources Co. for $30 million in cash.
Magnum Hunter currently owns an approximate 47.5% working interest in the properties being acquired, and upon closing, the company will have varied working ownership interests in the properties up to about 100%.
The company will become operator of that portion of the acquired properties which is currently being operated by Samson Resources. Upon closing of this acquisition, the company will own about 180,000 net acres in the Williston Basin.
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In addition to the acreage being acquired, the company is also acquiring about 310,000 barrels of oil equivalent of proved developed producing reserves and about 192 net barrels of oil equivalent production per day.
"The acquisition of these central Divide County assets will result in Williston Hunter becoming a Three Forks Sanish/Bakken operator in North Dakota along the border of Canada, which has been a primary goal," said Glenn Dawson, President of Williston Hunter Inc.
Magnum Hunter expects its initial drilling operations in the Williston Basin area to begin in the first quarter of 2013 utilizing one-mile horizontal lateral drilling and completion technology similar to its successful cost-effective strategy deployed in the Tableland Field in Saskatchewan this past year.
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The transaction, which is subject to customary closing conditions, is expected to close on or about December 20, 2012, with an effective date of August 1, 2012. The purchase price is subject to customary adjustments, to take into account the effective date of the transaction.
MHR is trading up 1.79% at $3.99 on Monday. The stock has been trading between $3.29 and $7.71 for the past 52 weeks.