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|LINN Energy Announces $400 Million Joint Venture With Anadarko in the Salt Creek Oil Field|
HOUSTON, April 3, 2012 (GLOBE NEWSWIRE) -- LINN Energy, LLC (Nasdaq:LINE - News) announced today a joint-venture agreement with an affiliate of Anadarko Petroleum Corporation (NYSE:APC - News), whereby LINN will participate as a partner in the CO2 enhanced oil recovery development of the Salt Creek field, located in the Powder River Basin of Wyoming. Anadarko assigned LINN 23 percent of its interest in the field in exchange for future funding of $400 million of Anadarko's development costs. Over the next three to six years, LINN expects to invest a total of $600 million, which includes the $400 million of Anadarko's costs and $200 million net to LINN's assigned interest. Anadarko has been utilizing CO2 to develop this field since 2004 with outstanding results, and additional development associated with this joint venture is expected to double current production by 2015. The agreement was signed and closed April 3, 2012.
"We are excited about this opportunity to partner with Anadarko in the Salt Creek field, where Anadarko has successfully implemented world-class CO2 enhanced oil recovery facilities and infrastructure to increase production," said Mark E. Ellis, Chairman, President and Chief Executive Officer. "We believe this long-life asset is unique because it is expected to deliver 10 years of steady production growth while, at the same time, providing a low base-decline rate. In addition, CO2 can potentially be used to enhance recovery in other reservoirs and portions of the field.
"Consistent with our strategy, we have already hedged all of the current net production associated with this joint venture through 2014, and we believe it will be immediately accretive to distributable cash flow per unit," added Ellis. "We also expect to greatly benefit from the knowledge we will gain by partnering with Anadarko, which has extensive experience in CO2 and enhanced oil recovery operations. We believe we have the potential to apply this knowledge and technology to several of our existing legacy oil fields."
Significant characteristics expected from the joint venture:
ABOUT LINN ENERGY
LINN Energy's mission is to acquire, develop and maximize cash flow from a growing portfolio of long-life oil and natural gas assets. LINN Energy is a top-15 U.S. independent oil and natural gas development company, with approximately 4.3 Tcfe of proved reserves (pro forma for announced 2012 acquisitions) in producing U.S. basins as of Dec. 31, 2011. More information about LINN Energy is available at http://www.linnenergy.com/.
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This press release includes "forward-looking statements." All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the company expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements include, but are not limited to forward-looking statements about acquisitions and the expectations of plans, strategies, objectives and anticipated financial and operating results of the company, including the company's drilling program, production, hedging activities, capital expenditure levels and other guidance included in this press release. These statements are based on certain assumptions made by the company based on management's experience and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include risks relating to the company's financial performance and results, availability of sufficient cash flow to pay distributions and execute its business plan, prices and demand for oil, natural gas and natural gas liquids, the ability to replace reserves and efficiently develop current reserves and other important factors that could cause actual results to differ materially from those projected as described in the company's reports filed with the Securities and Exchange Commission. See "Risk Factors" in the company's Annual Report filed on Form 10-K and other public filings and press releases.
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