El Paso acquires Texas properties for $211 million

El Paso has agreed to make two exploration and production acquisitions in east and south Texas totaling $211 million, the company said Jan. 31.

The properties add about 124 billion cubic feet equivalent of proved reserves and 29 million cubic feet equivalent per day of average net production, the company said, adding that about 59 percent of the reserves are proved undeveloped.

“Both acquisitions offer significant future drilling opportunities and fit well with El Paso’s existing operations,” El Paso said.

In east Texas, El Paso said it signed an agreement to purchase a privately held exploration and production company with operations in Rusk and Shelby counties for about $179 million. The deal includes 52 wells and associated gathering infrastructure with 20 million cubic feet per day of production from the Cotton Valley and Travis Peak formations.

As part of the east Texas transaction, El Paso said it also would acquire six additional wells that are currently being drilled or completed and 77 proved undeveloped locations. The transaction is subject to the approval of the seller’s shareholders.

In south Texas, El Paso said it purchased assets in the Samano field in Starr and Hidalgo counties for about $32 million. The acquisition includes 26 wells that produce about 9 million cubic feet of equivalent per day and an associated gathering system.

El Paso is the largest producer in the Samano and operates producing properties directly adjacent to the properties being acquired.

“We are adding a significant number of low-risk development locations to our inventory as well as properties that offer additional exploration upside,” El Paso spokeswoman Lisa Steward said. “We also expect to achieve operating synergies as we integrate these properties into our operations.”

—Ray Tyson