Unocal's Spirit Energy 76 affiliate to acquire assets of Tana Oil and Gas; builds on established position in Gulf of Mexico shelf
Sugar Land, Texas, Dec. 17, 1999 - Unocal Corporation's Spirit Energy 76 unit today announced that its Spirit Energy Partners, L.P., affiliate has agreed to acquire substantially all the Gulf of Mexico shelf assets of Tana Oil and Gas Corporation.
The Tana acquisition includes interests in 12 proven properties and nine offshore platforms. The purchase price was not disclosed.
Tana has an estimated net risked resource potential of more than 18 million barrels of oil equivalent (MMBOE), including more than 10 MMBOE in proved reserves. Estimated average annual production for 2000 is more than 10,000 BOE per day.
"The acquisition of the Tana assets will provide the opportunity to enhance Spirit Energy's position in areas where we already possess a strong foothold and enjoy highly profitable operations," said John T. Donohue, president of Spirit Energy 76. "These assets can be integrated immediately into our portfolio."
Ken Butler, vice president of Spirit's shelf business, added, "Spirit Energy can create value from this acquisition because of our low operating and drilling costs, our extensive infrastructure and subsurface knowledge, our proven production optimization techniques and our track record for rapidly converting reserves to production."
The transaction will be effective as of Oct. 1, 1999. Closing is expected February 3, 2000. A majority of the purchase price will be financed by Spirit Energy Partners, an entity formed by Unocal and The Northwestern Mutual Life Insurance Company to acquire producing properties in existing areas of operation. Unocal's 50-percent interest will be accounted for on an equity basis.
Spirit Energy operates about 300 offshore platforms and approximately 2,700 active wells in 355 fields.
Tana Oil and Gas is a subsidiary of privately held TRT Holdings, Inc. Based in Irving, Texas, Tana was formed in the early 1970s as an onshore oil and gas exploration and production company. In 1989, Tana sold its onshore properties and established the company as a presence on the Gulf of Mexico shelf.
Forward-looking statements regarding business and market transactions, resource potential and future value in this news release are based on assumptions concerning market, competitive, regulatory, environmental, operational and other considerations. Actual results could differ materially as a result of factors discussed in Unocal's 1998 Form 10-K report filed with the Securities and Exchange Commission.
Updated: December 1999