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Mergers & Acquisitions Deal Analysis - Apache to Acquire Oil & Gas Assets in the Shallow Waters of the Gulf of Mexico
GlobalData, April 2010, Pages: 9
Mergers & Acquisitions Deal Analysis - Apache to Acquire Oil & Gas Assets in the Shallow Waters of the Gulf of Mexico
Summary
Apache Corporation (Apache) agreed to acquire oil and gas assets in the shallow waters of the Gulf of Mexico (GOM), from Devon Energy Corporation (Devon Energy) for a purchase consideration of $1.05 billion. The acquired assets comprise 477,194 net acres across 158 blocks, valued at approximately $115 million. The fields have 80 platforms and 211 production caissons in waters to 450 feet deep. Seven major field areas hold 90% of proved reserves. Devon operates 75% of the production. Based on initial evaluation, Apache has identified 79 recompletion opportunities and 26 drilling prospects across the acquired assets. The assets have proved reserves of 41 million barrels of oil equivalent (mmboe) and probable reserves of 42 mmboe valued at $685 million and $250 million respectively. Apache will fund the acquisition primarily from its existing cash balances supplemented with commercial paper. Apache has hedged a portion of the production for three years using swaps and collars to protect the economics of the transaction. Bank of America Corporation is acting as financial advisor for Devon for the transaction. The transaction is subject to preferential rights to purchase held by the other working interest owners in the properties as well as customary closing conditions and regulatory approvals. The transaction implies deal values of $16.76 per boe of proved reserves, $8.26 per boe of 2P reserves and $240.99 per acre of land
Scope
- Rationale behind Apache Corporation's acquisition of assets in the Gulf of Mexico
- Strategic Benefits for Devon Energy to divest its assets
- Geography covered - US
- Deal Financials and Valuations
- Information on Gulf of Mexico assets, Apache Corporation and Devon Energy
Reasons to buy
- Develop a sound undestanding of the major M&A's, Partnerships, And Joint Ventures taking place in North American Oil & Gas industry
- Identify the most lucrative segments to leverage on the growth oppurtunities available in the US oil & gas market
- Get a detailed analysis of a deal to enable you to take better decisions
- Know about the major companies, which are adopting a divestment or acquisition strategy to enhance their business portfolios
- Learn about the key fiancial advisors in a particular segment in the Oil & Gas Industry
- Understand the various means of raising funds from the market.
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