Stone Energy acquires North Dakota, Montana acreage for $85 million

Ray Tyson

Louisiana-based Stone Energy has agreed to acquire about 35,000 exploration acres in the Williston Basin of North Dakota and Montana from an undisclosed independent exploration and production company for $85 million, Stone said Dec. 27.

The acquisition would be financed with borrowings under Stone’s bank credit facility pending final closing expected in February 2005.

“This acquisition represents another significant step in efforts to diversify our asset base,” said David Welch, Stone’s president and chief executive officer.

He said that combined with the company’s recent property acquisition in Utah, “we have created several growth opportunities for exploration and development in the Rocky Mountain region.”

The latest acquisition includes proved reserves and a minimal amount of oil production, Stone said, adding that about 85 percent of the $85-million purchase price is expected to be allocated to unevaluated acreage.

Much of the acquired acreage is located within the Bakken formation fairway. Stone said it expects to begin exploring the acreage with a multi-well drilling program beginning in 2005.