April 26 Oil and gas company Equal Energy Ltd said it will acquire Petroflow Energy Ltd's interests in the Oklahoma Hunton play for $93.5 million to boost its operations in the liquids-rich natural gas acreage, ending all legal disputes between the two companies.
Equal Energy, which converted to a corporation from Enterra Energy Trust last year, had a farmout dispute with Petroflow which was resolved in January. [ID:nSGE70I0C8]
North American Petroleum Corp USA, a unit of Petroflow Energy, filed for Chapter 11 bankruptcy protection last year as a drilling dispute with Enterra Energy, its major client, choked the company's liquidity and its ability to service debt.
The acquisition is expected to be add to Equal Energy's 2011 cash flow, production, reserves and net asset value on a per share basis.
Equal and Petroflow will equalize on a 50:50 basis the interests in zones above the Hunton in sections of land that were earned during the farmout, and Petroflow will operate a development program over these assets, Equal Energy said in a statement.
Calgary, Alberta-based Equal Energy has also entered into a bought deal financing to raise $50.3 million to fund the acquisition.
The two disputes between Equal and Petroflow and its bankers that related to monetary matters and a claim for partial ownership of water disposal facilities used in the Hunton play have been resolved. (Reporting by Bhaswati Mukhopadhyay; Editing by Sriraj Kalluvila)