Eagle Rock Energy plans 2 acquisitions |
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Published
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Mon, 02 Apr 2007 13:16
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HOUSTON (AP) - Natural gas partnership Eagle Rock Energy Partners LP said Monday it plans to execute two acquisitions in separate transactions with a combined value of $264.4 million.Eagle Rock Energy will pay $136.8 million in cash and company stock for Laser Midstream Energy LP, which owns more than 405 miles of gathering systems and related compression and processing facilities in south Texas, east Texas and north Louisiana.Eagle Rock Energy expects the Laser acquisition to contribute between $15.5 million and $17.5 million in earnings before interest, taxes, depreciation and amortization annually. It estimates maintenance capital in the range of $1.5 million to $2 million annually.Eagle Rock Energy Chief Executive Alex Butcher said the acquisition would expand the partnership's geographic footprint and offer greater basin and producer diversity.To finance the cash portion of the deal, Eagle Rock Energy will privately sell 7 million partnership units at $127.5 million. Eagle Rock Energy will also increase its credit facility by $100 million.Eagle Rock Energy also acquired certain fee minerals, royalties and working interest properties from Montierra Minerals & Production LP in a cash and stock deal worth about $127.6 million.The assets include interests in about 5.6 million gross mineral acres and 420,000 net mineral acres, as well as interests in more than 2,500 wells with net proved producing reserves of roughly 4.6 billion cubic feet of natural gas and 2.5 million barrels of crude oil. The assets are expected to generate between $14 million and $16.5 million in earnings before interest, taxes, depreciation and amortization annually with no maintenance capital requirements.Both deals are expected to close by late April.Copyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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