Boulder, Colo.-based Ellora Energy Inc. is exploring strategic alternatives, including, but not limited to, a sale or merger of the company or the sale of all or a substantial part of its assets.

The company has retained Bank of America Merrill Lynch as its advisor in this endeavor.

According to SMH Capital, most of the interest for Ellora acreage is likely to be linked to the company’s roughly 53,000 net Haynesville/James Lime position in Shelby County.

The company also holds roughly 18,000 net acres in Harrison and Panola and 733,000 net acres with deep rights in the Kansas Hugoton. SMH expects interest in Ellora assets to be high “due to recent well results in Shelby, nearby Nacogdoches, and San Augustine counties, including Devon’s well-publicized 30.7 MMcfpd well in north San Augustine.”

“Although Ellora's position is a logical fit with nearby operations in Shelby, Ellora assets could also provide a nice entry point for a new Haynesville player due to the scale and likely quality of the company’s Shelby acreage. Proved reserves are 194 Bcfe, none of which are attributable to the Haynesville Shale,” added SMH.