QEP Resources (QEP) has acquired additional acreage in the Williston Basin through an acquisition thus increasing the company’s leverage to the Bakken and Three Forks play.
QEP Resources announced the acquisition of two separate agreements to purchase 27,600 net acres at a cost of $1.38 billion. This will increase the company’s total exposure to 118,000 net acres. The oil and gas properties have undeveloped and developed acreage as follows:
- Net production 10,500 barrels of oil equivalent (BOE) per day
- Net proved and probable reserves of 125 million BOE, with 90% composed of crude oil and natural gas liquids.
- Acreage is in North Dakota (Williams and McKenzie county)
QEP Resources reported that the average estimated ultimate recovery (EUR) is 1.16 million BOE for Bakken wells and 990,000 BOE for Three Forks wells. The company estimates that the acquired acreage has 146 net undeveloped locations that can be developed at a cost of $1.59 billion. QEP Resources will fund the purchase with cash on hand and its revolving credit facility.
QEP Resources has also adjusted its guidance for 2012 as follows:
- Adjusted EBITDA range increased to $1.4 billion to $1.45 billion, compared to previous range of $1.35 billion to $1.4 billion
- Production increased to a range from 310 to 315 Bcfe (previous 305 to 310 Bcfe)
- Capital spending range increased to $1.5 billion to $1.55 billion (previous $1.45 to $1.50 billion)
