DENVER, June 3, 2013 /PRNewswire/ -- Kodiak Oil & Gas Corp. (NYSE: KOG), an oil and gas exploration and production company with primary assets in the Williston Basin, today announced that it has entered into a definitive purchase and sale agreement with Liberty Resources ("Liberty"), a Denver-based private oil and gas company, to acquire additional core Bakken and Three Forks producing properties and undeveloped leasehold in the Williston Basin of North Dakota.
The purchase price for the asset package is $660 million in cash. The purchase price is subject to adjustment including, but not limited to, adjustments for certain title and environmental defects, if any, as well as customary adjustments to reflect the operation of the properties following the effective date and prior to the closing. Net oil and gas production included in the pending acquisition is currently approximately 5,700 barrels of oil equivalent per day (BOE/d), which was the average net production for May 2013. Production is expected to increase before closing as completion operations are currently underway.
Upon completion of the transaction, Kodiak would acquire approximately 42,000 net acres located in McKenzie and southern Williams Counties, N.D., bringing the Company's pro forma total lease holdings in the Williston Basin to approximately 196,000 net acres. The acquired leasehold includes 35 controlled drilling spacing units, based upon 1,280-acre units, and is 90% held by production. The southern Williams County lands, approximating 14,000 net acres, are adjacent to Kodiak's core Polar area. An additional 25,000 net acres are located in McKenzie County to the west of the Company's Koala and Smokey areas. Kodiak will also assume Liberty's contract for one drilling rig, which has 14 months remaining on its term.
The acquisition is expected to close in
July 2013 and is subject to the completion of customary due diligence and closing conditions. The effective date for the transaction is
March 1, 2013, with any purchase price adjustments to be calculated as of the closing date.