GeoMet said Oct. 26 that it has been advised by the seller that the party holding the preferential purchase right on certain of the coalbed methane (CBM) properties in West Virginia, with an allocated value of $23.4 million, has irrevocably waived such right. This preferential purchase right was scheduled to expire on or about Dec. 3, 2011, if not earlier exercised or waived.
A portion of the CBM properties being acquired in Alabama remain subject to two preferential rights to purchase by a single party and have an allocated value of $30.8 million. These preferential rights to purchase will expire Oct. 29, 2011, if not earlier exercised or waived.
As a result of the early waiver of the preferential purchase right on certain of the West Virginia CBM properties, the GeoMet now anticipates the transaction will close in the first half of November.
As previously disclosed in the company’s press release of Oct. 17, total consideration for the acquired assets, which include CBM properties in Alabama and West Virginia, certain natural gas hedge positions and a license to use a certain drilling technology, is $90.2 million, subject to adjustment for net proceeds of production after July 1, 2011 (the “effective date”), realized hedge gains subsequent to the effective date, the exercise of the preferential purchase rights on certain of the Alabama CBM properties, and other customary price adjustments.