Comstock (CRK) to Sell Reeves and Gaines Assets in $768M Deal
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Price: $14.06 +3.53%
Financial Fact:
Operating income: -98.79M
Today's EPS Names:
SVBT, ZEO, OTLK, More
Financial Fact:
Operating income: -98.79M
Today's EPS Names:
SVBT, ZEO, OTLK, More
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Comstock Resources, Inc. (NYSE: CRK) announced that it has entered into a definitive agreement with Rosetta Resources Inc. (Nasdaq: ROSE) pursuant to which Rosetta will acquire all of Comstock's oil and gas properties in Reeves and Gaines counties in West Texas for a sales price of $768 million, subject to customary purchase price adjustments and closing conditions. The sale will have an effective date of January 1, 2013 and is expected to close on or about May 15, 2013. The Company intends to use the proceeds from the sale to reduce its outstanding debt and to fund an increase to its 2013 drilling program in the Eagle Ford shale.
Comstock also announced a revised capital budget for 2013 to reflect the divestiture of the West Texas properties and an increase in drilling activity in its Eagle Ford shale in South Texas. The Company is now projecting to spend $410 million in 2013 on drilling activities and $12 million on exploratory leasehold for total capital expenditures of $422 million. Comstock plans to spend $347 million to drill 82 wells (50.5 net) on its on-going operations in South Texas and East Texas/North Louisiana. The Eagle Ford shale will account for $312 million of the budget where Comstock plans to drill 72 wells (46.9 net) with the remainder related to the Company's natural gas properties primarily in East Texas and North Louisiana. Comstock plans to increase the number of operated rigs in South Texas from the three that are currently drilling to a total of six during the second half of 2013. Capital expenditures on the West Texas properties for 2013 prior to the closing of the divestiture are estimated to be $63 million to drill 16 wells (11.6 net).
Evercore Partners acted as exclusive financial advisor to Comstock with respect to this transaction and provided a fairness opinion to the Company's board of directors.
Comstock also announced a revised capital budget for 2013 to reflect the divestiture of the West Texas properties and an increase in drilling activity in its Eagle Ford shale in South Texas. The Company is now projecting to spend $410 million in 2013 on drilling activities and $12 million on exploratory leasehold for total capital expenditures of $422 million. Comstock plans to spend $347 million to drill 82 wells (50.5 net) on its on-going operations in South Texas and East Texas/North Louisiana. The Eagle Ford shale will account for $312 million of the budget where Comstock plans to drill 72 wells (46.9 net) with the remainder related to the Company's natural gas properties primarily in East Texas and North Louisiana. Comstock plans to increase the number of operated rigs in South Texas from the three that are currently drilling to a total of six during the second half of 2013. Capital expenditures on the West Texas properties for 2013 prior to the closing of the divestiture are estimated to be $63 million to drill 16 wells (11.6 net).
Evercore Partners acted as exclusive financial advisor to Comstock with respect to this transaction and provided a fairness opinion to the Company's board of directors.
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