Warren Resources executed a purchase and sale agreement to acquire essentially all of the Marcellus assets of Citrus Energy and two additional working interest owners for $352.5 million.
As part of the total consideration, Warren will issue $40 million in Warren common stock priced at $6.00 per share, with the remainder to be funded through fully committed debt financing. This acquisition provides Warren with a substantial new basin platform in the prolific Marcellus Shale and adds a new core area to Warren’s existing California oil and Wyoming natural gas assets.
The assets are currently producing approximately 82 million net cubic feet per day of natural gas, as of June 2014. Estimated net proved reserves, as of the July 1, 2014 economic effective date, totaled approximately 208.3 billion cubic feet, 55% proved developed, as estimated by Netherland, Sewell & Associates, Inc., Warren’s independent petroleum engineering firm.
President and Co-Founder of Citrus, Lance Peterson, will be joining Warren on its Board of Directors upon closing of the acquisition. In addition, Citrus’ key technical, operating and land personnel will be transitioning over to Warren as employees, including Zachary Waite, who will assume the role of Vice President of Business Development and Marcellus Operations, and Daniel Collins, who will assume the role of Vice President of Marcellus Land.
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Press Release, July 7, 2014