St. Mary to acquire 18.7 bcfe of reserves

Denver’s St. Mary Land & Exploration, through its Nance Petroleum subsidiary, has agreed to buy 18.7 billion cubic feet of gas equivalent reserves from an undisclosed seller for $39 million in cash, St. Mary said June 29. The deal is expected to close on Aug. 2.

The properties to be acquired are primarily in the Wind River and Powder River basins of Wyoming and currently produce about 530 barrels of oil and 3.2 million cubic feet of gas per day, or 6,400 million cubic feet of gas equivalent per day.

In addition, the acquisition would include about 7,200 net acres of undeveloped oil and gas leases, St. Mary said, adding that 100 percent of the estimated oil and gas production over the next two years is hedged at average Nymex prices of $56.70 per barrel of oil and $7.45 per thousand cubic feet of natural gas.

Payment for the properties would be made from cash on hand and money available under St. Mary’s existing credit facility, the company said.

—Ray Tyson