Jan 10 (Reuters) – Oil and gas producer Parsley Energy Inc said on Tuesday it would buy acreage in the Permian Basin for about $607 million as the company increases its presence in the oil-rich region.

Parsley Energy’s shares were down 4 percent at $35.1 in extended trading after the company announced a share sale plan to fund the acquisition.

The company said the acquisitions, which include undeveloped acreage and oil and gas producing properties, are located in the Midland and Southern Delaware Basins near its existing operations.

The Austin, Texas-based company said the acquisitions included 23,000 net leasehold acres and estimated current net production of about 2,300 barrels of oil equivalent per day (boe/d).

Parsley Energy said it expected the transactions to close on or before Feb. 27.

The company also set its capital budget to be between $750 million-$900 million for 2017, 60 percent of which it intends to use for development in the Midland Basin. The company’s 2016 capital budget is expected to be between $460 million-$510 million.

Parsley Energy also estimated average 2017 net production to be about 57,000-63,000 boe/d, a near 60 percent growth from 2016.

The company said it had commenced an underwritten equity offering of 20 million Class A shares.

(Reporting by Vishaka George in Bengaluru; Editing by Sriraj Kalluvila)

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