TEXEGY Leases Austin Chalk Acreage to Equinor
Published: Sept 24, 2018 8:00 a.m. ET
TEXEGY LLC (“TEXEGY”) announced today it has completed a transaction whereby it has entered into definitive agreements to lease a portion of its Austin Chalk minerals to Equinor Louisiana Properties LLC (“Equinor”), a subsidiary of Equinor ASA, formerly known as Statoil ASA, a multinational energy company headquartered in Stavanger, Norway. As part of this leasehold transaction, Equinor is now the operator of a substantial portion of TEXEGY’s Austin Chalk assets in the Burr Ferry field predominately located in Vernon Parish, Louisiana. Prior to this transaction, TEXEGY owned a majority of its Austin Chalk interests at 100% W.I. and 100% N.R.I.
TEXEGY was formed in late 2014 and has focused its efforts on acquiring and developing assets in Texas and Louisiana, which total over 100,000 acres. Burr Ferry and South Bearhead Creek fields in Vernon and Beauregard parishes, respectively, comprise the majority of the company’s Louisiana properties. AWP and Raccoon Bend fields in McMullen and Austin counties, respectively, make up the majority the company’s Texas properties.
“We could not be happier about this partnership,” said Sherif Wadood, Co-Founder of TEXEGY. “Everyone in the industry is familiar with Equinor and their technical and commercial expertise. This asset is unique—not only is it a part of the well-proven Brookland field, but it also has wells that have produced in excess of one million barrels of oil equivalent per well without the advantage of modern completions. We look forward to working together with Equinor to not only maximize the value of their leasehold interests but also our retained royalty interest.”
Rajan Ahuja, TEXEGY’s CEO and Co-Founder, said, “We are very excited for this partnership from both a technical and commercial perspective. Equinor has committed to shoot seismic and run geological/petrophysical analyses with the expectation of a long-term development plan on our land. The area has already attracted a variety of operator classes from large-cap public companies to small private equity backed teams, all of which are impressed by the same attractive attributes—significant proven reserves in place that have yet to be exploited via modern drilling and completion techniques.”
Michael Pedrotti, President and Co-Founder of TEXEGY said, “Over the course of 30 years, I have worked on all sorts of different deals, structures, acquisitions, and divestitures. Working with Equinor and closing this transaction ranks among the smoothest and most professional of them all. Equinor’s team, as well as our team here at TEXEGY, exhibited the highest levels of transparency, diligence, competence, and efficiency.”
Houlihan Lokey acted as financial advisor to TEXEGY, and Branscomb PC acted as legal counsel to TEXEGY for the transaction.
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