HOUSTON , Sept. 6, 2013 /PRNewswire/ -- EV Energy Partners, L.P. (NASDAQ: EVEP) announced that it, along with certain institutional partnerships managed by EnerVest, Ltd., has signed an agreement to acquire natural gas properties in the Barnett Shale from Carrizo Oil and Gas, Inc. EVEP has agreed to acquire a 31 percent interest in these assets for $67.6 million ( $218 million for all EnerVest-affiliated entities combined). The acquisition, which has been approved by the Board of Directors, is expected to close by October 31, 2013, and is subject to customary closing conditions and purchase price adjustments. EVEP plans to finance the acquisition with proceeds from its previously-announced Utica Shale acreage sale and borrowings under its existing credit facility.
The acquisition is comprised of 82 wells producing primarily from the Barnett Shale formation in Tarrant County, Texas. The assets include over 17,000 gross acres (9,500 net acres) which are 100 percent held by production.
The properties, and EVEP's share of reserves and production, include:
-- Estimated proved reserves as of July 1, 2013, of approximately 62.3 BCF and estimated probable reserves of 30.7 BCF, net to EVEP (based on recent strip prices)-- 100 percent natural gas and 58.4 percent proved developed -- 71 identified low-risk proved and probable drilling locations with an estimated average drilling and completion cost of $0.85 to $0.90 per MCF -- Net daily production to EVEP's interest of approximately 13.1 MMCF/D -- Natural gas pricing of NYMEX less $0.90 to $1.00 per MCF -- Current lease operating costs, including ad valorem taxes, of $0.65 to $0.75 per MCF of production -- Production taxes of 1.7% to 2.1% of revenue -- Incremental annual general and administrative expense of approximately $125,000 Mark Houser, President and CEO, said, " These 'bolt-on' assets are very complementary to our strong operating position within the Barnett Shale. Our team has a demonstrated exploitation track record in the Barnett and will leverage their expertise in these new high-quality gas properties. The Barnett reservoir within these new leases has estimated gas in place of 150-200 BCF per 640 acre section and the existing wells drilled have estimated ultimate recoveries averaging over 5 BCF per well. We believe these properties will provide very attractive future development opportunities, even at current gas prices ." In conjunction with the acquisition, and consistent with its strategy of hedging production of acquired assets, EVEP intends to enter into arrangements to hedge a portion of the acquired production volumes at or prior to closing. EV Energy Partners, L.P., is a master limited partnership engaged in acquiring, producing and developing oil and gas properties. More information about EVEP is available on the internet at www.evenergypartners.com . (code #: EVEP/G) (Logo: http://photos.prnewswire.com/prnh/20130415/DA94198LOGO) This press release may include statements that are not historical facts which are "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements include information about our expectation to close the acquisition, reserve information, future plans and other statements which include words such as "anticipates," "plans," "projects," "expects," "intends," "believes," "should," and similar expressions of forward-looking information. Forward-looking statements are inherently uncertain and necessarily involve risks that may affect the business prospects and performance of EV Energy Partners, L.P. Actual results may differ materially from those contained in the press release. Such risks and uncertainties include, but are not limited to, changes in commodity prices, the acquisition of additional production and technical information, possible title and environmental issues, the availability and cost of financing, the returns on our capital investments and acquisition strategies, and general economic conditions. Additional information on risks and uncertainties that could affect our business prospects and performance are provided in the most recent reports of EV Energy Partners with the Securities and Exchange Commission. All forward-looking statements included in this press release are expressly qualified in their entirety by the foregoing cautionary statements. Any forward-looking statement speaks only as of the date on which such statement is made and EVEP undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise. In filings with the Securities and Exchange Commission, we are required to report proved reserves as defined in Regulation S-X under the Securities Act. In general, Regulation S-X requires that in calculating proved reserves we use the unweighted average of the price of crude oil and natural gas on the first day of each month for the twelve months prior to the date of the report, without escalation. The reserves described above in this press release were calculated using forward strip prices. The estimated net proved reserves attributable to the properties being acquired by the partnership, using the unweighted average price for the twelve months ended August 31, 2013 of $3.605 per MMBTU of natural gas as required by Regulation S-X, are 58.4 BCF for the acquisition. The United States Securities and Exchange Commission ("SEC") permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable and possible reserves, as defined by the SEC. We use the terms estimated ultimate recovery and gas in place which are descriptions of volumes of hydrocarbons potentially recoverable through additional drilling or recovery techniques that the SEC's guidelines strictly prohibit us from including in filings with the SEC. These estimates are by their nature more speculative than estimates of reserves and accordingly are subject to substantially greater risk of actually being realized by the Company. Investors are urged to consider closely the disclosure in our SEC filings, available on our website or from the SEC's website at www.sec.gov. EV Energy Partners, L.P., Houston Michael E. Mercer 713-651-1144 http://www.evenergypartners.com SOURCE EV Energy Partners, L.P.
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