Berry buys gas properties in Colorado

Allen Baker

Berry Petroleum Co. is paying $110 million for interests in northeastern Colorado natural gas fields, the company said Dec. 6. The sellers are J-W Operating Co. and others. Berry, based in Bakersfield, Calif., will acquire interests in more than 130,000 acres in the Niobrara fields. The purchase provides Berry with 9 million cubic feet of gas production daily from an area with estimated proved reserves of 87 billion cubic feet.

Berry will have a 52 percent working interest and will be operator of the fields. The company plans to spend $4 million to $8 million next year in capital investments there. Berry expects to boost production by more than 15 percent a year over the next four years through infill drilling that will bring spacing to 40 acres per well, according to Robert F. Heinemann, the company’s president and CEO.

Effective date of the transaction is Nov. 1, with closing expected in the first quarter of next year. The purchase is being financed by borrowings under Berry’s existing credit facility.