This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Synergy Resources Completes Acquisition Of Assets From Orr Energy

PLATTEVILLE, Colo., Dec. 6, 2012 /PRNewswire/ -- Synergy Resources Corporation (NYSE Mkt: SYRG), a U.S. oil and gas exploration and production company focused on the Denver- Julesburg (D-J) Basin, has purchased from Orr Energy certain assets that include 36 producing oil and gas wells in the Wattenberg Field of the Denver-Julesburg Basin, along with a number of undeveloped leases both in the Wattenberg and surrounding area.

Synergy paid a total consideration of $42 million for the assets, comprised of $30 million in cash and $12 million in Synergy's common stock (approximately 3.1 million shares).

The 36 wells are currently producing at an aggregate average rate of 360 net BOE/D, with Synergy the operator on 35 of the wells. The oldest well has been producing since 2006, and all of the wells have been drilled vertically to the Codell, Niobrara and/or J-Sand formations.

Synergy has a 100% working interest (77% net revenue interest) in 29 of the wells, with a smaller working /net revenue interest in the remaining seven wells. The company will have a 100% working interest (80% net revenue interest) in the majority of future wells drilled on the leased acreage.

The drilled and undrilled leases cover approximately 3,933 gross (3,196 net) acres. Of these net acres, 2,191 are in the core of the Wattenberg field, adjoining or near existing Synergy leased acreage. Given the 20 acre spacing for vertical wells on this acreage, there is the potential to drill approximately 75 new vertical wells. Based on the 80 acre spacing for horizontal wells, there is the potential to drill 55 Codell / Niobrara horizontal wells.

The remaining net acres (approximately 1,005) are located northeast of the Wattenberg field near Grover, Colorado, and have not been drilled by Orr Energy. Management plans to use existing seismic data acquired in the transaction to establish a drilling program for new vertical and horizontal wells on this acreage. This acreage is in close proximity to the producing wells of other operators, where production is believed to contain a high oil ratio.

The cost to acquire the Orr Energy assets was included in the fiscal 2013 CAPEX guidance Synergy provided on its fiscal year end 2012 earnings call. Ed Holloway, CEO of Synergy Resources noted: "The acquisition will be accretive to our financial performance by the fiscal second quarter 2013. While we had already anticipated sequential quarterly revenue growth to return in our current fiscal first quarter; the acquisition will certainly increase our growth rate in the second quarter."

William Scaff, Synergy Resources' executive vice president, commented: "The acquired acreage continues to build critical mass within our existing core Wattenberg acreage and the new undrilled acreage continues to build our inventory of potential new well sites. Through the acquisition, Orr Energy becomes one of our largest shareholders.  We were able to acquire Orr Energy due to mutual respect between the two management teams and ongoing confidence that these assets will continue to grow further under Synergy Resource management."

About Synergy Resources Corporation Synergy Resources Corporation is a domestic oil and natural gas exploration and production company. Synergy's core area of operations is in the Denver-Julesburg Basin, which encompasses Colorado, Wyoming, Kansas, and Nebraska. The Wattenberg field in the D-J Basin ranks as one of the most productive fields in the U.S. The company's corporate offices are located in Platteville, Colorado. More company news and information about Synergy Resources is available at www.SYRGinfo.com.

For more information about Synergy Resources Corp., contact Justin Vaicek at Liolios Group at 949-574-3860 or email SYRG@liolios.com.

Important Cautions Regarding Forward Looking Statements This press release may contain forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995. The use of words such as "believes," "expects," "anticipates," "intends," "plans," "estimates," "should," "likely" or similar expressions, indicates a forward-looking statement. These statements are subject to risks and uncertainties and are based on the beliefs and assumptions of management, and information currently available to management. The actual results could differ materially from a conclusion, forecast or projection in the forward-looking information. Certain material factors or assumptions were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking information. The identification in this press release of factors that may affect the company's future performance and the accuracy of forward-looking statements is meant to be illustrative and by no means exhaustive. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. Factors that could cause the company's actual results to differ materially from those expressed or implied by forward-looking statements include, but are not limited to: the success of the company's exploration and development efforts; the price of oil and gas; the worldwide economic situation; changes in interest rates or inflation; the ability of the Company to transport gas; willingness and ability of third parties to honor their contractual commitments; the company's ability to raise additional capital, as it may be affected by current conditions in the stock market and competition in the oil and gas industry for risk capital; the company's capital costs, which may be affected by delays or cost overruns; costs of production; environmental and other regulations, as the same presently exist or may later be amended; the company's ability to identify, finance and integrate any future acquisitions; and the volatility of the company's stock price.

SOURCE Synergy Resources Corporation

Copyright 2011 PR Newswire. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,279.74 +13.75 0.08%
S&P 500 2,010.40 -0.96 -0.05%
NASDAQ 4,579.7870 -13.6380 -0.30%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs