Minnetonka Co. Buys Bakken Oil Wells, Land For $20.5M
Minnetonka-based Black Ridge Oil & Gas, Inc., said this week that it has signed a deal to acquire 11 oil and gas wells and 2,046 net acres in the Williston Basin for $20.5 million.
The oil and gas exploration and production company said the basin’s central location in the oil-rich Bakken/Three Forks shale was a key factor in the acquisition decision. The Williston Basin spans eastern Montana, western North Dakota, South Dakota, and southern Saskatchewan, Canada.
The deal, which is expected to close by December 13, will increase Black Ridge Oil & Gas’ reserves by 79 percent and its production by 53 percent. It adds the production of roughly “165 barrel of oil equivalents” per day. (A “barrel of oil equivalent” reflects the amount of energy produced by a barrel of crude oil.)
The deal also includes development acreage currently operated by Burlington Resources Oil and Gas Company LP., Marathon Oil Company, and Hunt Oil Company.
Black Ridge Oil & Gas CEO Ken DeCubellis said that the acquisition of assets in the Williston Basin ramps up the company’s existing oil exploration and production “platform” by increasing its “drilling inventory, production, and proved reserves in a meaningful way.”
“While the immediate increase in production and cash flow are a benefit to the company, the real, long-term value of this acquisition is in the high-return development projects and drilling inventory,” he said in a statement.
Black Ridge Oil & Gas currently controls roughly 12,000 net acres and drills in approximately 90 wells in the Bakken/Three Forks region in western North Dakota and eastern Montana. The company reported 2012 revenue of $6 million—a 214 percent increase from 2011—and $4.9 million in net income.