Noble Energy Inc. has agreed to purchase substantially all of the Rockies upstream assets of Petro-Canada Resources (USA) Inc. and Suncor Energy (Natural Gas) America Inc. for $494 million. The company estimates total proved reserves to be 53 million barrels of oil equivalent (MMBoe), 45% of which are liquids and 80% within the liquid-rich Wattenberg field, Noble Energy's largest onshore US asset.
The acquisition will add about 10 thousand barrels of oil equivalent per day (MBoe/d) or 46 million cubic feet of natural gas and 2,500 barrels of liquids to Noble Energy's daily production base. Included in the purchase is 340 thousand total net acres, nearly 200 thousand of which are located in the Greater DJ Basin.
Total net risked resources (proven, probable and possible) are estimated at 103 MMBoe. Noble Energy has identified several thousand projects associated with the assets being acquired, including over 2,000 Codell/Niobrara drilling locations in Wattenberg. The company plans to add two rigs to its Wattenberg program in 2010 as a result of the transaction, increasing the company's operated drilling activity in the field to eight rigs. Including activity on acreage outside Wattenberg, Noble Energy expects to grow net production from the assets to approximately 20 MBoe/d by 2012, with a focus on increasing liquids contribution.
David L. Stover, Noble Energy's president and COO, said, "We now control a leasehold position of over 530 thousand net acres in the central DJ Basin with net production approaching 52 thousand barrels equivalent per day.”
The acquisition is expected to close late in the first quarter 2010 and will be subject to customary closing conditions. Funding is expected to be provided through the company's existing credit facility.