Independent exploration and production firm, Oasis Petroleum Inc. (OAS) reported the pricing of senior unsecured notes worth $1.0 billion, due to mature in 2022. The company added that the notes are expected to carry an interest of 6.875% and will be offered to small number of selected investors. Initially, the size of the offering was declared at $600 million but was later increased by another $400 million. The offering is likely to close on Sep 24, 2013.
Oasis Petroleum reveals that the notes will like be priced at 100% of their face value. Moreover, the net proceeds from the offering will be utilized to partly finance the company’s acquisition of West Williston-based oil and gas assets.
Recently on Sep 5 2013, Oasis Petroleum entered into four purchase and sale deals to buy roughly 161,000 net acres of land in the Williston Basin. The company is willing to invest $1.5 billion to purchase the assets. According to the internal report of operation, after the acquisition, the company will own 492,000 net acres of land and is expected to produce roughly 43,000 barrels of oil equivalent per day. Oasis Petroleum believes that the four agreements will get closed by the first half of Oct 2013.
Houston, Texas-based Oasis Petroleum is involved in the acquisition of oil and gas assets located in the Williston Basin’s Montana and North Dakota regions. The company is also engaged in the development of those resources.
Oasis Petroleum currently carries a Zacks Rank #2 (Buy), implying that it is expected to outperform the broader U.S. equity market over the next one to three months.
Apart from Oasis Petroleum, one can look at other exploration and production companies like Range Resources Corp. (RRC), SM Energy Co. (SM) and Whiting Petroleum Corp. (WLL) that offer value. All the stocks sport a Zacks Rank #1 (Strong Buy).
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