Pacific Energy Development Announces the Acquisition of 14,000 Net Acres & 40 Wells in the Niobrara Shale Formation, the Secu...
March 10 2014 - 8:30AM
Marketwired
Pacific Energy Development Announces the Acquisition of 14,000 Net
Acres and 40 Wells in the Niobrara Shale Formation, the Securing of
a Drilling Capital Facility, the Raising of $7.3 Million Through
Equity Issuance, and Cancellation of Shares Resulting in
Effectively No Increase in Shares Outstanding
DANVILLE, CA--(Marketwired - Mar 10, 2014) - PEDEVCO Corp. d/b/a
Pacific Energy Development (NYSEMKT: PED) (the "Company"), an
energy company engaged in the acquisition and development of
strategic high-value energy projects in the U.S. and Asia, today
announced the following:
- The closing of the previously announced acquisition of
approximately 28,000 net acres in Wattenberg and Wattenberg
Extension in Colorado
- The entering of a joint venture with RJ Resources for a 50%
working interest on the project going forward, resulting in 14,000
net acres to the Company
- The closing of a $34,500,000 loan to facilitate the purchase of
the Colorado acreage
- Establishment of a $15,500,000 drilling facility for the
development of the new Colorado acreage
- The issuing of 3,438,500 shares of common stock through an
underwritten registered shelf offering for gross proceeds to the
Company of $7,392,775
- The cancellation of 3,333,333 shares of common stock resulting
in 26,309,011 shares issued and outstanding
The Company today announced
that it has successfully completed the previously announced
acquisition of an interest in 40 wells and approximately 28,000 net
acres in the DJ Basin, Colorado from an independent U.S. oil and
gas company. The acreage acquired in the Niobrara Shale
Formation is almost entirely located in Weld County, Colorado,
including some acreage in the prolific Wattenberg Area. Of the
40 wells in which interests were acquired, 11 are now operated by
the Company, 14 are non-operated, and the Company will have an
after-payout interest in the remaining 15 wells. The purchase had
an effective date of December 1, 2013. The Company paid
approximately $28 million in cash, reflecting oil and gas
production credited to the Company since the December 1, 2013
effective date, and certain other adjustments.
In order to finance the
acquisition and provide the Company with sufficient capital to
immediately commence a meaningful development program covering this
new acreage, the Company entered into a 3-year term debt facility
with RJ Resources, a subsidiary of a NY-based investment management
group with more than $1.3 billion in assets under management
specializing in resource investments. As part of the transaction,
RJ Resources, will be a 50% working interest partner with the
Company in the development of its assets going forward, allowing
the Company to undertake a more aggressive drilling program, in
2014. As a result, the Company has an interest in 14,000 net
acres after closing. The Company has drawn down $34.5 million
of a $50 million dollar debt facility, and can draw down the
remaining $15.5 million for drilling capital to develop this new
acreage. In addition to cash on hand, proceeds of the just
completed offering of common stock, and future anticipated oil and
gas revenues, this facility should give the Company sufficient
drilling capital to meet its 2014 drilling budget.
Casimir Capital LP served as
the Company's financial advisor in the acquisition and debt
financing transactions.
On March 7th, the Company
closed its recently announced underwritten offering of an aggregate
of 3,438,500 shares of common stock, which included the full
exercise of the overallotment by the underwriters. The Company
has received gross proceeds of $7,392,775 before deducting
underwriting discounts and estimated offering expenses as a result
of the offering.
The Company further announced
today that it has cancelled 3,333,333 shares of common stock that
had been held in escrow in connection with an August 2013
subscription, which has been cancelled by the Company, resulting in
a reduction in the number of the Company's shares of common stock
to 26,309,011 currently issued and outstanding, after taking into
account the new shares issued in connection with the March 7th
public offering.
Frank C. Ingriselli, President and CEO of the Company, stated,
"We believe that this acquisition transforms our Company into one
of the key players in the prolific Niobrara play. It offers us a
unique opportunity to significantly increase our daily production
in the DJ Basin and increase our acreage by over 500%, and also
provides us an entry into the exciting Wattenberg
Area. Through the experience and operational efficiencies we
have gained through our operations in the Niobrara play over recent
years, we are confident that we can successfully develop these
assets, thereby maximizing shareholder value. We are also pleased
to work with our new strategic partner, RJ Resources, who has
afforded us the financial backing to launch an aggressive
development program for this asset and the access to capital needed
to accomplish our strategic plan. In considering this joint venture
with RJ Resources, we determined that selling down an interest in
the future drilling would allow the Company to undertake a more
aggressive drilling program to better develop this acreage. I
am also pleased that, consistent with our focus on building
shareholder value, we were able to accomplish this acquisition and
access to significant drilling capital with essentially no net
additional equity issued by the Company."
About Pacific Energy Development (PEDEVCO Corp.)
PEDEVCO Corp, d/b/a Pacific Energy Development (NYSEMKT: PED),
is a publicly-traded energy company engaged in the acquisition and
development of strategic, high growth energy projects, including
shale oil and gas assets, in the United States and Asia. The
Company's principal assets include its Niobrara asset located in
the DJ Basin in Colorado, its Mississippian asset located in
Comanche, Harper, Barber and Kiowa Counties, Kansas, and its North
Sugar Valley asset located in Matagorda County, Texas. The Company
has also previously announced its entry into an agreement to
acquire a working interest in a 380,000 acre producing asset
located in the Pre-Caspian Basin, one of the largest producing
basins in Kazakhstan, which acquisition is pending Kazakhstan
government approval. Pacific Energy Development is
headquartered in Danville, California, with offices in Houston,
Texas and Beijing, China.
Forward-Looking Statements
All statements in this press release that are not based on
historical fact are "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995 and the
provisions of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. While management has based any forward-looking statements
contained herein on its current expectations, the information on
which such expectations were based may change. These
forward-looking statements rely on a number of assumptions
concerning future events and are subject to a number of risks,
uncertainties, and other factors, many of which are outside of the
Company's control, that could cause actual results to materially
differ from such statements. Such risks, uncertainties, and other
factors include, but are not necessarily limited to, those set
forth under Item 1A "Risk Factors" in the Company's Annual Report
on Form 10-K for the year ended December 31, 2012. The Company
operates in a highly competitive and rapidly changing environment,
thus new or unforeseen risks may arise. Accordingly, investors
should not place any reliance on forward-looking statements as a
prediction of actual results. The Company disclaims any intention
to, and undertakes no obligation to, update or revise any
forward-looking statements. Readers are also urged to carefully
review and consider the other various disclosures in the Company's
public filings with the SEC.
Contacts Pacific Energy Development Bonnie Tang 1-855-733-3826
ext 21 (Media) PR@pacificenergydevelopment.com Investor Relations:
Liviakis Financial Communications, Inc. John Liviakis
+1-415-389-4670 john@liviakis.com Stonegate, Inc. Casey Stegman
214-987-4121 casey@stonegateinc.com
PEDEVCO (AMEX:PED)
Historical Stock Chart
From Mar 2024 to Apr 2024
PEDEVCO (AMEX:PED)
Historical Stock Chart
From Apr 2023 to Apr 2024