motherlode acquisition

Advance Energy to increase its stake in the Motherlode project in Martin County Texas by a further 67.5% WI.

Total proved net reserves of 387,000 BO
5x wells producing 50 boepd each
multiple enhancement opportunities including
2x stimulation candidates
2x PDNP plugback candidates
3x PUD

The key here imo is that AVD and their operators know this ground like the back of their hand. They have been negotiating this for 2 years and clearly see the opportunity to add significant value.
The acquisition will add cashflow of approx US$2.5m p.a, one would assume that any production would fall outside of any current hedging contracts and therefore be exposed to current high prices.

This acquisition is obviously a perfect fit for AVD (and will be financed from existing facilities) but i am still waiting for the big one, something around the $15-20m range.
Still a nice addition to revenue and reserves and plenty of enhancement opportunity, with the possibility of another 2 acquisitions of similair nature nearby.