Eastern DJ Basin Acquisition Closes in 1st Quarter of 2014
Posted by Mary-Margaret
In February 2014, on behalf of its Fund IV, Foundation Energy added to its operations through the acquisition of a producing set of assets on the eastern side of the Denver-Julesberg (DJ) Basin. The DJ Basin, where Foundation Energy has operated since 2005, is a geologic basin centered in eastern Colorado and extending into Wyoming, Nebraska and Kansas. The acquisition was the company’s second acquisition in the eastern DJ basin, was its largest acquisition to date, and was the second transaction it closed with this seller, a large U.S. independent. The transaction positions the company as one of the largest producers in the eastern DJ basin, which is expected to lead to additional bolt-on acquistions.
The acquired properties include interests in 1,159 producing wells with current net production of approximately 19 MMcfpd. The acquired production is from low-decline and long-lived Niobrara Biogenic gas wells. In addition, the acquisition includes over 110,000 net developed acres of leasehold, over 800 miles of pipeline and gas gathering infrastructure and over 9,000 horsepower of owned and rental gas compression equipment.
Foundation Energy retained the seller’s office in Yuma, Colorado, and welcomed 19 new employees, many of whom have operated the assets since the 1990s.