By the OGJ Online Staff
HOUSTON, May 24 -- EOG Resources Inc., Houston, has agreed to buy Energy Search Inc., Knoxville, Tenn., an independent focused on gas drilling and production in the Appalachian basin for $91 million.
The deal is worth $51 million in cash, and EOG also will assume another $40 million in debt, EOG spokeswoman Maire Baldwin told OGJ Online Thursday.
Terms call for Energy Search stockholders to receive $8.22/share. Closing is expected in the third quarter.
"It's a strategic acquisition," Baldwin said, adding EGO acquired Appalachian basin property last September so this was an expansion of its holdings in that area.
The acquisition of Energy Search includes about 120,000 acres of undeveloped leases.
Energy Search is an independent oil and gas exploration and production company focused on gas reserves in the Appalachian basin.
It produced more than 6 MMcfd last year and has proven reserves of 63.6 bcf equivalent, company documents showed.
In February 2000, Energy Search hired investment banker McDonald Investments Inc., Cleveland, Ohio, to review options for increasing shareholder value.
EOG Resources is mostly active in US producing basins but also has holdings in Canada and Trinidad.