QR Energy LP, ticker QRE, announced on Monday it will purchase oil and natural gas fields in Texas, Oklahoma and New Mexico. Costing the company $577 million.
The Houston based energy company will purchase the properties from the Quantum Resources Fund. Funding of the purchase will come from the issue of $350 million in convertible preferred units and it will also pay Quantum $227 million in cash. This deal should close on Oct. 1.
QR Energy said the fields contain an estimated 37.1 million barrels of oil and is spread over 109,305 acres and already has approximately 1,600 wells.
QRE investors are already enjoying a great dividend at 9 1/2 percent, $1.65 per share as QRE trades slightly to the upside this morning at 17.14.
Properties located in existing core areas: Permian Basin, Ark-La-Tex and Mid-Continent
Net production of 8,000 Boed expected for the fourth quarter of 2011
Total proved reserves of 37.1 MMBoe are 65% proved developed and 41% liquids (oil and NGLs)
More than 1,500 producing oil and natural gas wells
Inventory of low risk development opportunities
Reserve life (R/P) of 12.7 years
77% operated by value based on standardized measure
Expected to be immediately accretive to Distributable Cash Flow per unit
Click here to get a free trend analysis for QRE