LONDON (Alliance News) - Diversified Gas & Oil PLC said Tuesday it has completed the USD400 million acquisition of a number of gas producing assets from HG Energy II Appalachia LLC.
Included in the assets are 107 gas producing wells with a net daily production exceeding 20,000 barrels of oil equivalent. The wells are located near Diversified's existing operations in Pennsylvania and West Virginia.
"This is yet another transformative transaction consistent with our ambitious and proven growth strategy," said Chief Executive Rusty Huston. "The HG Energy Acquisition firmly establishes Diversified as a top-tier London-listed producer, supported by a healthy balance sheet, a strong cash flow profile and a healthy dividend yield. We now turn our attention to the seamless integration of these assets into our smarter well management program."
Additionally, Diversified said it has hedged, though the New York Mercantile Exchange, 80.00 billion British thermal units per day - about 13.30 billion barrels of oil equivalent per day - at an average price of USD2.73 per BTU through April 2020, which is a 9% premium to the current month price.
For the same period, the company also executed gas basis hedges for 70.00 billion British thermal units per day - about 11.70 billion barrels of oil equivalent per day - at an average Tetco M2 price of USD0.40, which is also a premium of 9% on the current month's price.
Diversified has swapped GBP170 million at USD1.3255 per GBP1, resulting in a realised gain of USD4 million.
Shares in Diversified Gas & Oil were up 1.7% Tuesday at 120.50 pence each.
