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Forest Oil Buys Texas Assets

The company is paying $255 million.

Forest Oil


said Monday that it will acquire producing assets, including about 26,000 net acres in eastern Texas, from six private entities for $255 million in cash.

The company plans to fund the acquisition using its credit facility and cash on hand.

The Denver-based natural gas producer estimates the assets have proved reserves of 110 billion cubic feet of gas. With the acquisition, Forest Oil believes it will add 4 billion cubic feet to its 2006 production and 8 billion cubic feet to its 2007 output.

Forest Oil has identified 300 drilling locations. The company expects to close the acquisition on March 31, subject to customary closing conditions and adjustments.

This story was created through a joint venture between and IRIS.