Continental Resources to buy more Bakken formation assets

Continental Resources Inc. has agreed to buy certain Bakken formation producing and undeveloped properties for $650 million. The property includes leasehold of 120,000 net acres, primarily in the North Dakota counties of Divide and Williams.

The Bakken acquisition involves production of 6,500 boe/d, said Continental, which already is the largest single leaseholder in the Bakken with 984,040 net acres as of Sept. 30. If completed, the proposed acquisition will increase the total to 1.1 million net acres.

In addition, Continental agreed to sell producing crude oil and natural gas properties and supporting assets in its east region for $125 million.

The divestiture primarily includes properties east of the Mississippi River, including the Illinois basin and the state of Michigan. Production from the properties included in the sale agreement averaged 1,100 boe/d for the 3 months ended Sept. 30.

“We are divesting noncore, conventional assets and reinvesting the proceeds in an attractive acquisition that further builds our strategic, core position in the Bakken,” said Harold Hamm, Continental chairman and chief executive officer. “Continental operates a large portion of the acreage that we are acquiring, and more than half of it is held by production.”

If the Bakken acreage acquisition is completed as planned, Continental expects additional 2013 drilling capital expenditures will be largely offset by incremental cash flow from the properties.

Both transactions are expected to close before Dec. 31, subject to customary closing conditions and adjustments.

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