Legacy Reserves LP today announced it has entered into an agreement to purchase 100% of the membership interests of Pantwist, LLC from Cano Petroleum, Inc. for $42.7 million cash, subject to customary closing adjustments. Legacy is to acquire an estimated 453 Boe of daily production (72% oil and natural gas liquids), 3.1 MMBoe of proved reserves, 100% of which is proved developed producing. The closing is expected to be on October 1, 2008.
Legacy also closed the acquisition on August 29, 2008, of assets from Gryphon Production Company, LLC for approximately $13.0 million. Legacy acquired an estimated 115 Boe per day, of which 92% is oil and natural gas liquids (NGL). Proved reserves acquired are estimated to be 1.6 MMBoe, of which 61% are classified as proved developed producing. The balance of the proved reserves is associated with Legacy's plans to reactivate up to 300 available wellbores.
Over 98% of the assets being purchased in these two transactions are operated and are located in Carson, Gray, Hutchinson and Moore counties in the Texas Panhandle near Legacy's existing assets. Cary Brown, Legacy's Chairman and Chief Executive Officer, commented, "These acquisitions demonstrate our commitment to the Panhandle of Texas as a second core area for Legacy Reserves. The Panhandle fits our strategy to acquire long-lived reserves. We will now operate over 1,000 wells and own interests in approximately 1,500 non-operated wells. Including the pending Pantwist acquisition, we will have acquired oil and gas properties aggregating approximately $209 million year to date, which is approaching the goal we set at the beginning of 2008."