Completion of Cotton Valley Asset Acquisition

RNS Number : 1110Z

Diversified Energy Company PLC

19 May 2021

 

19 May 2021

Diversified Energy Company PLC

("Diversified" or the "Company")

Completion of Cotton Valley Asset Acquisition

Diversified Energy Company PLC (LSE: DEC) confirms that further to the announcement made by the Company on 30 April 2021, it has completed the purchase of certain Cotton Valley upstream assets and related infrastructure from Indigo Minerals LLC ("Indigo") (the "Acquisition").

Acquisition Highlights

· Establishes an entry into Diversified's newly identified Central Regional Focus Area ("RFA")

· Gross consideration paid of $135 million (before customary purchase price adjustments)

· Annualised 4Q20 Adjusted EBITDA of approximately $40MM

· PDP reserves of ~50 MMBoe (305 Bcfe) with pretax PV10 of ~$175MM based on 16 April 2021 NYMEX strip

· Current production of ~16 MBoepd (~95 MMcfepd) includes ~780 net operated wells

· Retention of key field personnel to streamline integration and Smarter Asset Management initiatives

· Initial hedge positions cover approximately 80% and 50% of remaining CY2021 and full-year CY2022 production, respectively, from the Acquisition assets

The Acquisition constitutes a Class 2 transaction for the purposes of the Listing Rules and this announcement is made in accordance with the Company's disclosure obligations pursuant to Chapter 10 of the Listing Rules.

Rusty Hutson, Jr., CEO of the Company commented:

"We are excited to solidify our entry into the strategically-aligned Central focus area, a prolific natural gas producing region that affords us a tremendous opportunity to build significant scale and cash flow. I'm pleased to welcome the former Indigo employees to the Diversified family who are eager to integrate these assets as they embrace our Smarter Asset Management philosophy designed to maximize the value of every well. This acquisition provides us a foundation to acquire additional accretive, long-life producing assets that will contribute to strong shareholder returns, add stability to our hedge-protected dividend and drive additional debt reductions over time."

For further information, please contact:

Diversified Energy Company  PLC	[phone]
Teresa Odom, Vice President, Investor Relations
www.dgoc.com
[e-mail]
Buchanan	[phone]
Financial Public Relations
Ben Romney
Chris Judd
Kelsey Traynor
James Husband
[e-mail]

About Diversified Energy Company PLC  

Diversified Energy Company PLC is an independent energy company engaged in the production, marketing and transportation of primarily natural gas related to its synergistic US onshore upstream and midstream assets.

 

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