OKLAHOMA CITY, Aug. 22, 2018 /PRNewswire/ -- PANHANDLE OIL
AND GAS INC. (NYSE: PHX) today reported that on Aug. 21, 2018, it closed on the acquisition of
the mineral acreage and producing oil and gas properties announced
in its July 19, 2018, press release.
The purchased assets are primarily located in the Bakken/Three
Forks play in North Dakota.
Activity on the acreage is ongoing with eight of the 20 previously
drilled uncompleted Bakken/Three Forks wells (DUCs) now producing.
The purchase price was $9 million and
was funded utilizing Panhandle's bank credit facility.
Additionally, the Company entered into an agreement to purchase
a total of 77 leased mineral acres located in three separate
drilling units in the core of the STACK/Cana play in Blaine County, Okla., for $790,000 from a private seller. This acreage is
located in a very prolific area of STACK Meramec activity where
recent wells have peak 30-day production rates of approximately
15-25 Mmcfe per day. The acreage is also in the core of the Cana
Woodford play, but is largely undeveloped with a single horizontal
Woodford producing well in one of
the units. Closing is anticipated to take place before Sept. 1, 2018.
Paul Blanchard, President and
CEO, said, "These transactions are the result of methodically
carrying out the mineral strategy outlined in our July 19, 2018, press release, which has the
ultimate purpose of maximizing long-term shareholder value by
optimizing the Company's allocation of capital and minimizing
risks.
"The mineral strategy is part of the Company's overall corporate
strategy as outlined below, which will guide capital allocation
decisions moving forward."
Panhandle Corporate Strategy
- Manage Mineral Ownership as a Portfolio to Maximize Value and
Generate Optimal Cash Flow.
-
- Selectively participate with working interest on existing
holdings in the highest quality, low-risk projects that are
projected to exceed corporate return thresholds.
- Aggressively lease out mineral holdings outside areas of
potential working interest participation.
- Grow the mineral holdings by acquiring undervalued mineral
rights in resource plays.
- Divest limited optionality and overvalued mineral rights.
- Maintain Strong Financial Position.
-
- Allocate capital for highest shareholder returns.
- Drive operational efficiency, minimize G&A expense.
- Maintain conservative leverage ratio to ensure the ability to
survive and thrive in all business and commodity cycles.
- Hedge to manage commodity risk and to protect balance
sheet.
- Reward Shareholders.
-
- Continue to pay regular dividends.
- Pay special dividends when the company has capital availability
beyond the needs of the business.
- Repurchase shares when the stock trades at a material discount
to the company's estimate of intrinsic value.
Mr. Blanchard continued, "This strategy will be the framework
from which all of Panhandle's capital allocation decisions are
made. Panhandle's primary goal is to use its existing assets and
financial flexibility to maximize value creation on a per share
basis over the long term while minimizing risks."
Panhandle Oil and Gas Inc. (NYSE: PHX)
Oklahoma City based Panhandle Oil
and Gas Inc. is engaged in the acquisition, management
and development of non-operated oil and gas properties on its
mineral and leasehold acreage, with its principal properties
located in Oklahoma, Arkansas, Texas, New
Mexico and North Dakota.
www.panhandleoilandgas.com.
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SOURCE PANHANDLE OIL AND GAS INC.