By Oil & Gas Financial Journal staff
BILLINGS, Mont. – Voyager Oil & Gas Inc. (OTCBB:VYOG) has issued $15 million in 12% senior secured notes to raise money for drilling and development of the company’s position in the Denver-Julesberg Basin Niobrara formation and the Williston Basin Bakken/Three Forks formation.
Voyager's Chief Executive Officer J.R. Reger commented, "We believe this debt issuance will enable us to efficiently fund the development stage of our growth as we convert our large Niobrara and Bakken acreage to production. With this capital and our forecasted cash flow from producing wells, we expect to be able to fund our Niobrara and Bakken development plans at a cost of capital significantly below the projected returns on the wells and cheaper than issuing equity at our current share price."
Oil shale deal flow heating up in Bakken, Niobrara
D-J Basin Niobrara
In June, Voyager gained a 50% working interest in Slawson Exploration Co. Inc.'s 48,000 net acres in Weld County, Colorado and Laramie County, Wyoming for $7.5 million. Slawson, ranked No.40 in the OGFJ100P ranking of top private companies in July, has drilled to total depth the first two gross wells targeting the Niobrara formation and a third well is currently drilling. These initial test wells are the first of up to 60 gross wells planned over the next 24 months in the drilling program. By the end of 2010, Voyager expects to have spud five gross (2.5 net) Niobrara wells. Fracture stimulation and production results on the wells are expected in the fourth quarter of 2010.
Williston Basin Bakken and Three Forks
Voyager currently controls approximately 24,000 net acres in the Williston Basin, primarily in Williams and McKenzie Counties, North Dakota and Richland County, Montana. Voyager has spud 10 gross Bakken wells, of which two are in production. By the end of 2010, Voyager expects to spud 15 gross Bakken wells. In 2011, Voyager expects to spud approximately 35 gross and 5 net Bakken wells.
The notes mature on September 17, 2011 and may be extended an additional year at the end of the initial term, at the option of Voyager.
