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Highlights
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Aurora to acquire 100% working interest in approximately 2,700 net acres
near to or adjacent to the Sugarkane Field
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Acquisition consideration US$117.5 million
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Aurora secures US$125 million bridge debt facility, in addition to the
recent increase in the borrowing base of its senior secured revolving
credit facility to $275 million
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Acquisition asset's production rate 1,620 boe/d net of royalties, which
adds an additional 12% to Aurora's 2012 exit rate
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Increases Aurora's net acreage by 14% to over 21,800 net acres and
significantly adds to the future net well inventory
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Aurora estimates that the acquisition adds 6.7 mmboe of 1P reserves
after royalties and 14.0 mmboe of 2P reserves after royalties,
effective March 1, 2013
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Acreage is located in the over-pressured, liquids-rich zone of Eagle
Ford Shale trend, includes potential additional reserves in Austin
Chalk and Pearsall formations
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Aurora to operate acreage, allowing for discretion on capital allocation
and the pace of development
TORONTO, Feb. 28, 2013 /CNW/ - Aurora Oil & Gas Limited (ASX:AUT,
TSX:AEF) ("Aurora") is pleased to announce that it has agreed to
acquire a 100% operated working interest in approximately 2,700 net
acres in South Texas for a consideration of US$117.5 million.
The assets include average December 2012 production of approximately
1,620 boe/d net of royalties from 11 wells and associated interests in
field infrastructure and related assets. The production comprises 84%
liquids (70% oil), and represents a 12% increase to Aurora's 2012 exit
production.
The assets consist of two consolidated blocks located within the
liquids-rich zone of the Eagle Ford shale trend and are either adjacent
to or very proximate to Aurora's existing Sugarkane Field acreage as
shown in the map below.
To view the map, please click the following link: http://files.newswire.ca/955/Aurora_map.pdf
The acquisition will increase Aurora's net core Eagle Ford shale acreage
by approximately 14% to over 21,800 net acres. The acreage includes
potential additional reserves in Austin Chalk and Pearsall formations.
The acquisition includes approximately 6.7 mmboe of proved reserves
(after royalties) of which 30% are categorized as proved developed
producing reserves and 84% are liquids. The proved reserves were
estimated by Aurora's internal reserve evaluators with an effective
date of December 31, 2012 and were based upon key assumptions that are
consistent with or more conservative than those used in Ryder Scott
Company L.P.'s report dated January 31, 2013 evaluating Aurora's
Sugarkane Field reserves as of the same effective date. The acquisition
is expected to close on or about March 29, 2013, subject to the
satisfaction of customary sale conditions. The effective date of the
acquisition will be March 1, 2013.
Aurora will become the operator of the asset having put in place a
skilled operating management team in Houston over the past 12 months.
In addition the Company has secured new and existing contractors to
assist in project execution in a manner consistent with local industry
practices. Transitional operatorship services have been negotiated with
the seller and other industry-leading contractors to facilitate an
efficient and effective handover and management of operations.
Operatorship of this project will offer Aurora discretion on capital
allocation and the pace of development.
Financing
The purchase price and associated development capital is expected to be
satisfied through existing and new debt facilities. Aurora has obtained
bridge loan commitments of US$125 million from Credit Suisse Securities
(USA) LLC and UBS Securities LLC. This is in addition to an increase in
the funding available to Aurora under the existing US$300 million
senior secured revolving credit facility to US$275 million, announced
February 27, 2013.
Aurora Executive Chairman Jon Stewart said: "This acquisition adds to our position in the highest quality
liquids-rich part of the Eagle Ford play. Aurora is extremely selective
around acquisition opportunities and we firmly believe the purchase of
this acreage will provide significant value and upside to our portfolio
through its current production capabilities and reserves base. We have
ensured maintenance of a conservatively geared balance sheet,
facilitated by our increased 2012 earnings."
Aurora CEO Douglas E Brooks added: "This acquisition is a natural extension from Aurora's existing
non-operated position within the "sweet spot" of the Eagle Ford trend.
The acquisition of an operated asset that is held by production offers
us considerable flexibility in the timing and methodology of
development, adds materially to current production and includes upside
to the reserves to be booked through higher density drilling and the
evaluation of additional formations."
About Aurora
Aurora is an Australian and Toronto listed oil and gas company active in
the over pressured liquids rich region of the Eagle Ford Shale in
Texas, United States. The Company is engaged in the development and
production of oil, condensate and natural gas in Karnes, Live Oak and
Atascosa counties in South Texas. Aurora participates, ahead of this
acquisition, in approximately 77,000 highly contiguous gross acres in
the heart of the trend, including approximately 19,100 net acres within
the liquids rich zones of the Eagle Ford.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities of Aurora in the United
States or in any jurisdiction in which such offer, solicitation or sale
would be unlawful. The securities to be offered have not been and will
not be registered under the United States Securities Act of 1933, as
amended, or any state securities laws, and may not be offered or sold
within the United States absent registration or an applicable exemption
from the registration requirements of the United States Securities Act
of 1933, as amended, and applicable state securities laws.
Cautionary and Forward Looking Statements
Statements in this press release reflect management's expectations
relating to, among other things, target dates, Aurora's expected
drilling program, the benefits of its proposed acquisitions and the
ability to fund its development program are forward-looking statements,
and can generally be identified by words such as "will", "expects",
"intends", "believes", "estimates", "anticipates" or similar
expressions. In addition, any statements that refer to expectations,
projections or other characterizations of future events or
circumstances are forward-looking statements. These statements are not
historical facts but instead represent management's expectations,
estimates and projections regarding future events.
Although management believes the expectations reflected in such
forward-looking statements are reasonable, forward-looking statements
are based on the opinions, assumptions and estimates of management at
the date the statements are made, and are subject to a variety of risks
and uncertainties and other factors that could cause actual events or
results to differ materially from those projected in the
forward-looking statements. These factors include risks related to:
exploration, development and production; oil and gas prices, markets
and marketing; failure to complete the acquisitions completed herein;
acquisitions and dispositions generally; competition; additional
funding requirements; reserve estimates being inherently uncertain;
incorrect assessments of the value of acquisitions and exploration and
development programs; environmental concerns; availability of, and
access to, drilling equipment; reliance on key personnel; title to
assets; expiration of licences and leases; credit risk; hedging
activities; litigation; government policy and legislative changes;
unforeseen expenses; negative operating cash flow; contractual risk;
the sufficiency of budgeted capital expenditures in carrying out
planned activities; the receipt of all regulatory and third party
approvals and management of growth. In addition, if any of the
assumptions or estimates made by management prove to be incorrect,
actual results and developments are likely to differ, and may differ
materially, from those expressed or implied by the forward-looking
statements contained in this document. Such assumptions include, but
are not limited to, general economic, market and business conditions
and corporate strategy. Accordingly, investors are cautioned not to
place undue reliance on such statements.
All of the forward-looking information in this press release is
expressly qualified by these cautionary statements. Forward-looking
information contained herein is made as of the date of this document
and Aurora disclaims any obligation to update any forward-looking
information, whether as a result of new information, future events or
results or otherwise, except as required by law.
PDF available at: http://stream1.newswire.ca/media/2013/02/28/20130228_C9476_DOC_EN_24166.pdf
SOURCE: Aurora Oil & Gas Limited
