Texaco Press Release - Texaco Announces Purchase of Enervest San Juan
FOR RELEASE: TUESDAY, JANUARY 9, 2001
DENVER, January 9 - Texaco today announced that it has purchased EnerVest San Juan Acquisition Limited Partnership (EnerVest San Juan) from EnerVest Management Partners, Ltd., (EnerVest Partners) and from GE Capital Oil & Gas, for $121 million. The purchase is effective retroactively to November 1, 2000.
EnerVest San Juan's assets consist entirely of coalbed methane gas properties located in the San Juan Basin of southwestern Colorado and northwestern New Mexico. These assets comprise proven reserves of 204 billion cubic feet of gas, of which some 53 percent are undeveloped. Current net production from the assets is approximately 21.5 million cubic feet per day with anticipated growth to 38 million cubic feet per day within the next three years.
Commenting on the announcement, Alan A. Kleier, Vice President for Texaco Exploration and Production Inc.'s Central U.S. Business Unit, said, "The assets acquired through the EnerVest San Juan purchase are highly complementary to our existing San Juan Basin coalbed methane business. This acquisition will enable us to build value through additional drilling, workovers and increased production, as well as capitalize on operating synergies with our existing properties."
Texaco operates San Juan Basin wells near the acquired EnerVest San Juan properties. Prior to the purchase, Texaco's gas production in the San Juan Basin totaled 104 million cubic feet of natural gas per day. Restimulation and infill drilling over the last three years have doubled Texaco's gas production in the area while significantly reducing operating costs.
EnerVest Partners is a Houston-headquartered oil and gas company, which has a primary focus on the acquisition of upstream oil and gas properties on behalf of institutional investors. EnerVest Partners manages approximately $600 million in assets and operates over 5,000 wells.
GE Capital Oil & Gas invests in reserve acquisitions, asset monetizations, gas gathering, processing, storage, transmission and distribution. It is a unit of GE Capital Structured Finance Group, a leading equity investor and provider of innovative structured financial products and services to the global energy, telecommunications, industrial, and transportation sectors. GE Capital, with assets of over US$345 billion, is a global, financial services company with 28 specialized businesses. It is a wholly owned subsidiary of General Electric Company, a diversified manufacturing, technology, and services company with operations worldwide.
This press release contains a number of forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. In particular, statements made concerning Texaco's expected performance and financial results in future periods are based upon Texaco's current expectations and beliefs and are subject to a number of known and unknown risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.
The following factors known to Texaco, among others, could cause Texaco's actual results to differ materially from those described in the forward-looking statements: incorrect estimation of reserves; inaccurate seismic data; mechanical failures; decreased demand for motor fuels, natural gas and other products; above or below-average temperatures; pipeline failures; oil spills; worldwide and industry economic conditions; inaccurate forecasts of crude oil, natural gas and petroleum product prices; increasing price and product competition; price fluctuations; higher costs, expenses and interest rates; the outcome of pending and future litigation and governmental proceedings; continued availability of financing; and strikes and other industrial disputes. In addition, you are encouraged to review Texaco's latest reports filed with the SEC, including Texaco's Annual Report on Form 10-K filed with the SEC on March 30, 2000, which describes a number of additional risks and uncertainties that could cause actual results to vary materially from those listed in the forward-looking statements made in this press release.
Updated: January 2001