OGJ Oil Diplomacy Editor
LOS ANGELES, July 29 -- Hess Corp., building on several recent acquisitions aimed at diversifying its worldwide portfolio, has agreed to acquire American Oil & Gas (AOG) in an all-stock transaction.
AOG's operations are largely concentrated in the Bakken and Three Forks formations in the Williston basin area of North Dakota, where it controls about 68,000 net acres.
In late March, AOG claimed a $64 million valuation of its oil and gas properties, reporting total proven reserves of 147,510 bbl of oil and 8.66 billion cu m of natural gas at yearend 2009.
In addition to two wells it has drilled since December 2009, AOG plans to drill another five net wells through yearend at Goliath. Besides Goliath, the company owns 530 sq km in the Rocky Mountains.
The acquisition, which adds to earlier deals struck by Hess in Norway and France, will significantly increase the firm’s strategic acreage position in North Dakota’s Bakken oil play.
AOG also is expected to benefit from a $30 million working capital credit from Hess that will help to finance its exploration and production activities.
Hess’s acquisition comes at a time when the firm also is expanding its portfolio overseas. In an effort to increase its reserves, Hess acquired additional interests in Norwegian North Sea offshore fields Valhall and Hod (7.85% and 12.5% respectively) from Total in June for $496 million in cash (OGJ Online, June 22, 2010).
In May, Hess and Paris-based Toreador Resources Corp. announced that they will jointly tackle Toreador’s shale oil permits in France’s Paris basin, where the Jurassic Toarcian shale covers an area larger than the North Texas Barnett shale play (OGJ Online, May 11, 2010).
Contact Eric Watkins at email@example.com.