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Eclipse Resources Boosts Utica Acreage by $93.7M Buyout Deal
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In a bid to expand its Utica acreage, upstream player Eclipse Resources Corporation recently inked a deal with private operator Travis Peak Resources LLC to acquire the latter’s north-central Pennsylvania assets. Post the announcement, shares of the company rose more than 6% to eventually close at $2.28 on Dec 11.
Per the deal, Eclipse Resources will acquire 44,500 net acres in Tioga and Potter counties of Pennsylvania in an all-equity deal valued at $93.7 million, thus maintaining its leverage and liquidity metrics. Subject to satisfactory closing conditions, the transaction is set for completion by January 2018.
In a separate transaction, Eclipse Resources agreed to acquire Cardinal NE Holdings, LLC for 18.3 million in cash. The deal will entitle Eclipse Resources to gain midstream assets and related gathering infrastrucrture in the acquired acreage.
The Travis Peak acquisition will add around 87 net drilling locations and boost the company’s Utica dry gas acreage by approximately 85%. The acquisition includes one proved developed producing well with production capacity of 6.5 million cubic feet per day.
While the deal allows Eclipse Resources to acquire just one proved developed producing well, there are 22 Utica offset wells drilled by other producers. As such, the company can extend its acreage position through increased leasing or bolt on acquisitions over time.
The deal helps the company to add large complementary undeveloped acreage with strong growth potential. It increases Eclipse Resources’ total Utica undeveloped acreage by over 45%, while boosting its internal rate of return from drilling programs. The acreage offers geologic similarities with Utica dry gas acreage and the company plans to leverage its super lateral capabilities in the region using the same technical expertise which brought success to the existing Utica acreage.
Currently, Eclipse Resources carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the same industry are Northern Oil and Gas, Inc. (NOG - Free Report) , Bill Barrett Corporation and Rice Midstream Partners LP . While Northern Oil & Gas sports a Zacks Rank #1(Strong Buy), Bill Barrett and Rice Midstream carry a Zacks Rank #2 (Buy), each. You can see the complete list of today’s Zacks #1 Rank stocks here.
Northern Oil and Gas delivered an average positive earnings surprise of 175% in the trailing four quarters.
Bill Barrett delivered an average positive earnings surprise of 19.41% in the trailing four quarters.
Rice Midstream delivered an average positive earnings surprise of 35.25% in the trailing four quarters.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
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Eclipse Resources Boosts Utica Acreage by $93.7M Buyout Deal
In a bid to expand its Utica acreage, upstream player Eclipse Resources Corporation recently inked a deal with private operator Travis Peak Resources LLC to acquire the latter’s north-central Pennsylvania assets. Post the announcement, shares of the company rose more than 6% to eventually close at $2.28 on Dec 11.
Per the deal, Eclipse Resources will acquire 44,500 net acres in Tioga and Potter counties of Pennsylvania in an all-equity deal valued at $93.7 million, thus maintaining its leverage and liquidity metrics. Subject to satisfactory closing conditions, the transaction is set for completion by January 2018.
In a separate transaction, Eclipse Resources agreed to acquire Cardinal NE Holdings, LLC for 18.3 million in cash. The deal will entitle Eclipse Resources to gain midstream assets and related gathering infrastrucrture in the acquired acreage.
The Travis Peak acquisition will add around 87 net drilling locations and boost the company’s Utica dry gas acreage by approximately 85%. The acquisition includes one proved developed producing well with production capacity of 6.5 million cubic feet per day.
While the deal allows Eclipse Resources to acquire just one proved developed producing well, there are 22 Utica offset wells drilled by other producers. As such, the company can extend its acreage position through increased leasing or bolt on acquisitions over time.
The deal helps the company to add large complementary undeveloped acreage with strong growth potential. It increases Eclipse Resources’ total Utica undeveloped acreage by over 45%, while boosting its internal rate of return from drilling programs. The acreage offers geologic similarities with Utica dry gas acreage and the company plans to leverage its super lateral capabilities in the region using the same technical expertise which brought success to the existing Utica acreage.
Currently, Eclipse Resources carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the same industry are Northern Oil and Gas, Inc. (NOG - Free Report) , Bill Barrett Corporation and Rice Midstream Partners LP . While Northern Oil & Gas sports a Zacks Rank #1(Strong Buy), Bill Barrett and Rice Midstream carry a Zacks Rank #2 (Buy), each. You can see the complete list of today’s Zacks #1 Rank stocks here.
Northern Oil and Gas delivered an average positive earnings surprise of 175% in the trailing four quarters.
Bill Barrett delivered an average positive earnings surprise of 19.41% in the trailing four quarters.
Rice Midstream delivered an average positive earnings surprise of 35.25% in the trailing four quarters.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>