American Eagle Energy Corporation; “American Eagle” or the “Company”) is pleased to announce the acquisition of additional working interest in several key non-operated spacing units in the Spyglass Project area. The purchase price is $8,000,000, of which thirty percent was paid on December 31 with the balance due and payable by June 30, 2013, has an economic effective date of November 1, 2012. The seller is an affiliate of one of the Company’s non-operating partners in the Spyglass Project area. This transaction, which closed on December 31, 2012, is one of the two pending acquisitions referenced by the Company in yesterday’s announcement of its $18 million financing agreement with Macquarie Bank Ltd.
The spacing units included in the acquisition are operated by Samson Resources and are being aggressively developed in both the Three Forks and Middle Bakken Formations. Samson has approved spacing orders allowing the drilling of up to 28 wells in the subject spacing units. As of the closing date, there were nine producing wells in the subject area making approximately 3,340 BOPD yielding approximately 285 BOPD, net to the acquired working interest. There are five additional wells in various stages of drilling and completion. Based on a third-party engineering report, the estimated net present value discounted at 10% (NPV10) of these 14 active locations is approximately $11,400,000.
“This production acquisition in the Spyglass area squarely fits within American Eagle’s strategy of consolidating its interests in properties that have a well understood risk profile and good reserve potential,” said Brad Colby, American Eagle’s President, “Our recently announced financing agreement with Macquarie Bank allowed us to take advantage of this timely acquisition opportunity and to put the funds to work immediately to generate additional cash flow and supplement our reserve position in the area.”
