Forest Oil Corp., Denver, (NYSE: FST) plans to buy a privately held, North Texas-focused company for an estimated $200 million in cash and assumption of $30 million of debt (net of working capital). The acquisition target's primary asset is an average 83%-operated working interest in the gas-prone Buffalo Wallow Field and approximately 33,300 gross acres primarily in Hemphill and Wheeler counties, located in the Texas Panhandle. Buffalo Wallow Field will become the largest field by value and estimated proved reserves in Forest's portfolio. It comes with proved reserves of 120 billion cu. ft. equivalent (46% proved developed; 71% gas) and production of 25- to 30 million equivalent per day that is expected to grow to between 40- to 45 million in 2006. The deal involves some 8,300 gross acres of land that has recently been approved for 20-acre down-spacing; approximately 370 identified drillsites; and 25,000 gross acres of additional undeveloped land, primarily in Wheeler County, that is prospective for Granite Wash, Atoka and Morrow formations. Forest intends to fund the acquisition and resulting exploitation from cash flow. Forest's reserve life will grow 3% to eight years. Craig Clark, president and chief executive, says, "This is another step to increase the relative size and quality of our onshore North American asset base. It also represents another accretive acquisition at reasonable economics. With this acquisition, Forest has now spent over $1 billion in acquisitions since the introduction of the Four-Point Game Plan." Without allocating any of the purchase price to land or other categories of reserves, Forest's acquisition cost per proved thousand cu. ft. of gas equivalent is about $1.92 and cost per daily unit of production is $9,000 per thousand, according to Forest. The field currently has estimated lease operating expenses of $0.63 per thousand equivalent.