BreitBurn Energy Partners LP
), a master limited partnership, has entered into a deal with a
wholly owned affiliate of
Whiting Petroleum Corporation
). Whiting Petroleum is an independent oil and gas firm.
BREITBURN EGY (BBEP): Free Stock Analysis
OASIS PETROLEUM (OAS): Free Stock Analysis
WHITING PETROLM (WLL): Free Stock Analysis
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Per the contract, BreitBurn Energy will pay $860 million to
purchase the stakes of Whiting Petroleum in Postle and North East
Hardesty oil fields, including related midstream properties. The
fields are situated in Oklahoma Panhandle.
BreitBurn Energy has already paid $86 million to Whiting
Petroleum. This payment will be adjusted toward the acquisition
price during the closing of the transaction. It is expected that
the purchase will be closed by Jul 31, 2013, subject to customary
closing conditions and adjustment related to purchase price.
BreitBurn Energy added that it will also buy extra stakes from
other sellers in some of the acquired properties, for a further
consideration of roughly $30.2 million.
BreitBurn Energy believes that this agreement will significantly
hike the distributable cash flow for the unit holders and create
value for them in the long run. The partnership also revealed
that currently, 98% of the total production from the acquired
assets is liquid. Should the property purchase go through,
BreitBurn Energy expects the net liquid output during the fourth
quarter of 2013 to increase by over 100% from the year-ago
Los Angeles, Calif.-based BreitBurn Energy is involved in the
acquisition, development, and production of domestic oil and gas
The partnership currently retains a Zacks Rank #3 (Hold),
implying that it is expected to perform in line with the broader
U.S. equity market over the next 1 to 3 months.
Meanwhile, one can look at
Oasis Petroleum Inc
Sanchez Energy Corporation
) as good buying options. The exploration and production firms -
sporting a Zacks Rank #1 (Strong Buy) - have solid secular growth
stories with the potential to rise significantly from the current