Ring Energy (REI) acquisiton to double production - Feb 26

[dan_s]

MIDLAND, Texas--(BUSINESS WIRE)--Ring Energy, Inc. (NYSE American: REI) (“Company”) (“Ring”) announced today that it has entered into a definitive agreement with Wishbone Energy Partners, LLC and its affiliates (“Wishbone”) to acquire its North Central Basin Platform assets located primarily in Southwest Yoakum County, Texas and East Lea County, New Mexico. The total purchase price for the acquisition is $300 million, comprised of $270 million of cash and $30 million of common stock of the Company. SunTrust Bank has provided a financing commitment letter for an increased $1 billion senior credit facility with a borrowing base of $425 million. SunTrust Robinson Humphrey will act as lead arranger and book manager for the financing. The transaction is expected to close early in the second quarter, 2019, with an effective date of November 1, 2018.

The assets consist of 49,754 gross (37,206 net) acres of mostly contiguous leasehold. Ring will be the operator and have a 77% working interest and a 58% net revenue interest. The acreage is adjacent to the prolific Wasson and Brahaney fields. There is a base of 127 gross wells currently producing an average daily net production of 6,000 Boe. The assets are approximately 96% operated by current production volume. In addition, current infrastructure includes 1,385 acres of owned surface rights, 21 saltwater disposal wells, 15 source water wells, five frac ponds and three caliche pits for road material and new locations.

Read more: https://investor.ringenergy.com/press-r ... sin-assets

If you attended the Amazing Energy (AMAZ) presentation at The Hess Club today, you should read the press release above. It should give you an idea of the potential they may have in the Central Basin Platform area of the Permian Basin.

[zdrk10]

Dan, the REI acquisition does give a good potential to AMAZ's acreage. Could you give a brief update on the AMAZ presentation from last Tuesday and how they seem to be progressing? I think they have a San Andres well that is close to completion. Thanks.

[dan_s]

In a nutshell, Amazing is a company with a large acreage position, but they lack the capital to do much with it. This is a very capital intensive industry. Amazing needs to find a partner with deep pockets that will fund a D&C program on their leasehold.
Their new position in Lea County, New Mexico was the most interesting part of the presentation for me.

It is expensive to be a public company. Amazing needs to get something going soon to ramp up revenues.