The acquisition is expected to close during the fourth quarter of 2007 and is subject to other customary closing conditions. Pioneer plans to use a portion of the proceeds from the previously announced master limited partnership initial public offering and sale of its Canadian subsidiary to fund the acquisition.
Pioneer estimates that the acreage being acquired holds 81 billion cubic feet gas equivalent (Bcfe) of net proved reserves and has total net resource potential of 480Bcfe. Net production from the properties is currently averaging 15 million cubic feet per day.
The acreage being acquired includes more than 300 potential drilling locations, with most locations covered by 3-D seismic data. Essentially all of the potential gas reserves and drilling locations are on approximately 37,000 gross acres in Parker County where Pioneer will be the operator and own an average working interest of approximately 70%. The acquisition also includes approximately 37,000 gross acres in expansion areas of the Barnett Shale play.
Scott Sheffield, chairman and CEO, said: We are encouraged by the early drilling results from our entry into the Barnett Shale. This acquisition is a significant step towards achieving our goal of building a core position in this play.
