Eagle Energy Trust buys producing oil assets in Texas
ALBERTA, Canada -- Eagle Energy Trust’s operating subsidiary, Eagle Energy Acquisitions LP, has entered into a binding agreement with an undisclosed party to acquire producing petroleum properties in Hardeman County, Texas, for a purchase price of $26,250,000 in cash.
Eagle expects to add approximately 300 boepd to its existing production. The acquisition is expected to close on or about November 25, 2013, with an effective date of October 1, 2013.
The $26.3 million acquisition will be entirely funded by bank debt. Pro-forma net debt at closing is expected to be approximately $76 million resulting in a conservative pro-forma debt to cash flow ratio of 1.5:1. After the closing of the acquisition, Eagle expects to have approximately $14 million of undrawn capacity under its credit facility.
"Like our previous acquisitions, this acquisition adds a high field netback, cash flow producing asset, which provides upside through a low risk drilling inventory. The assets maintain Eagle's focus on oil production located in close proximity to refineries, enhance the long-term sustainability of Eagle's asset base and represent an accretive acquisition for our unitholders without stretching our balance sheet," said Richard Clark, Eagle's president and CEO.