Quarterly report pursuant to Section 13 or 15(d)

Acquisitions

v2.4.1.9
Acquisitions
 3 Months Ended
Mar. 31, 2015
Acquisitions And Dispositions [Abstract]  
Acquisitions

Note 2 – Acquisitions

 

On October 8, 2014, the Company completed the acquisition of certain undeveloped acreage and producing oil and gas properties located in Midland, Andrews, Ector and Martin Counties, Texas (the “Central Midland Basin Acquisition”) for an aggregate cash purchase price of $210,205. The Company assumed operatorship of the properties on November 1, 2014, and acquired a 62% working interest (46.5% net revenue interest) in the Central Midland Basin Acquisition. The aggregate cash purchase price was funded with a combination of the net proceeds from an equity offering of $122,450 and a portion of the proceeds from borrowings under a secured second lien term loan.

 

The Central Midland Basin Acquisition was accounted for under the acquisition method of accounting, which involves determining the fair value of the assets acquired and liabilities assumed. The following purchase price allocation is based on management’s estimates of the fair value of the assets acquired and liabilities assumed. The following table summarizes the acquisition date fair values of the net assets acquired:

 

 

 

 

 

Oil and natural gas properties

 

$
91,895 

Unevaluated oil and natural gas properties

 

 
118,450 

Asset retirement obligations

 

 
(140)

  Net assets acquired

 

$
210,205 

 

The following unaudited summary pro forma financial information for the three months ended March 31, 2014 has been presented for illustrative purposes only and does not purport to represent what the Company’s results of operations would have been if the Central Midland Basin Acquisition had occurred as presented, or to project the Company’s results of operations for any future periods. The pro forma financial information was prepared assuming the Central Midland Basin Acquisition occurred as of January 1, 2013. The pro forma adjustments are based on available information and certain assumptions that management believes are reasonable, including revenue, lease operating expenses, production taxes, depreciation, depletion and amortization expense, accretion expense, interest expense and capitalized interest. 

 

 

 

 

 

 

Three Months Ended

 

 

March 31, 2014

Revenues

 

$
43,184 

Income from operations

 

 
12,357 

Income available to common stockholders

 

 
791 

 

 

 

 

Net income per common share:

 

 

 

Basic

 

$
0.01 

Diluted

 

$
0.01