In order to begin working on about 28,000 net acres in the Denver-Julesberg basin acquired from an unnamed oil and natural gas company, Pacific Energy Development Corp. (NYSE MKT: PED) entered into a 3-year debt facility with RJ Resources, a subsidiary of a New York investment management group, Pacific Energy said March 10.
RJ Resources will be a 50% working interest partner in the assets development process, the company said, noting that this arrangement will allow a more aggressive drilling program.
The company has an interest in 14,000 net acres, and the purchase’s effective date was Dec. 1, 2013, Pacific Energy added.
Pacific Energy paid about $28 million, the company said.
The DJ Basin acreage, in the Niobrara shale area, is almost wholly in Weld County, Colo. and includes Wattenberg portions, the company said.
Out of a total of 40 area wells, Pacific Energy now owns 11 and will have after-payout interest on the remaining 15, the company said.
Pacific Energy drew down $34.5 million of the $50 million debt facility, and will draw down the remaining $15.5 for drilling capital, the company said.
Casimir Capital LP was Pacific Energy’s financial advisor, the company noted.
Additionally, Pacific Energy closed a recent underwritten offering of 3,438,500 common shares, including the overallotment, for $7,392,775 million in gross proceeds, Pacific Energy said.
Also, Pacific Energy cancelled 3,333,333 common shares that were held in escrow in connection with a cancelled August 2013 subscription, the company said.
This reduced the amount of currently issued and outstanding common shares to 26,309,011, Pacific Energy added.
Danville, Calif.-based Pacific Energy Development Corp. acquires and develops shale and natural gas onshore in the U.S., as well as in Asia.
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