By OGJ editors
HOUSTON, Feb. 24 -- XTO Energy Inc., Fort Worth, Tex., has agreed to acquire producing properties located primarily in the Barnett shale of North Texas and in the Arkoma basin for $200 million.
The properties are being purchased from multiple parties, and most of the acquisitions are expected to close by Apr. 15.
XTO plans to allocate $20 million in additional development funds to the new properties, bringing the 2004 development expenditures to $520 million. XTO will operate more than 88% of the value of these producing properties.
"These transactions highlight XTO's entry into the highly prolific Barnett shale region," said Bob R. Simpson, chairman and CEO. "We have acquired producing properties in the core area of development and plan to expand our position."
The core area of the shale is considered to be in Wise and Denton counties (OGJ, Jan. 19, 2004, p. 45).
XTO's technical teams have been assessing the Barnett shale for 2 years, said Steffen E. Palko, vice-chairman and president. "Our expertise in horizontal drilling and water-fracturing techniques will find a perfect application in developing the Barnett shale. Importantly, the areal extent of the shale should allow XTO to build a compelling growth program."
In the Barnett shale, XTO is acquiring 97.6 bcfe of proved reserves, of which 42% is developed, for $120 million. Currently production from the properties total 15 MMcfed. XTO expects substantial upside in its initial 11,000-acre position.
XTO also is expanding its operating presence in the Arkoma basin with the purchase of 56.3 bcfe of reserves, 70% developed, for $80 million. The properties produce about 10 MMcfed.