Upstream energy company
Miller Energy Resources Inc.
) has entered into a binding deal to buy Savant Alaska LLC. After
the purchase, Savant Alaska will become the fully owned affiliate
of Miller Energy. Miller Energy is expected to pay roughly $9.0
million cash for the acquisition. The deal is pending regulatory
approvals and is slated for an Aug 2014 closure.
Through the acquisition, Miller Energy will get roughly 67.5%
operating interest in the Badami oil field, situated at the North
Slope of Alaska. The rest 32.5% is owned by ASRC Exploration LLC.
Through 67.5% ownership, Miller Energy will be able to operate
roughly 17,200 gross acres in the oil field with eight operating
wells which are presently producing gross 1,100 barrels of oil
Moreover, the acquisition entails the drilling of two wells - B1-14
and B1-28 with an estimated 2 million barrels of recoverable oil
reserve -planned in the Badami oil field. Each well would involve
about $15.0 million in Miller Energy's capital expenditure.
Knoxville, TN based Miller Energy mainly involves in the
exploration, production and drilling of oil and natural gas
resources. The company 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 one to three months.
Meanwhile, one can look at better-ranked players in the oil and gas
exploration and production industry like
Athlon Energy Inc.
Callon Petroleum Company
). All the stocks sport a Zacks Rank #1 (Strong Buy).
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