GE Energy Financial Services announced today it has partnered with two experienced operators to acquire $154 million in oil and gas reserves in Oklahoma and Texas.With Bays Exploration Inc., the GE unit acquired oil and gas reserves with significant development opportunities in western Oklahoma for $79 million. In addition, Energy Financial Services plans to invest up to $60 million for the development of the reserves.
In the second transaction, GE Energy Financial Services partnered with Southern Bay Energy, a subsidiary of GeoResources, Inc. (NASDAQ: GEOID) to acquire oil and gas properties in the Austin Chalk trend of East Texas for $75 million. GE Energy Financial Services plans to invest an additional $27 million for the development of these properties.
Additional financial and operational details of the two transactions were not disclosed.
An affiliate of GE Energy Financial Services holds limited partnership interests in two separate partnerships, with Bays Exploration Inc. and an affiliate of Southern Bay Energy serving as general partners of the two entities and operators of the respective properties.
“Our partnership combines the Bays Exploration team with the financial strength of G.E.,” said Joe Bays, President of Bays Exploration, Inc. “This blend will allow us to accelerate the development of our proved reserves in an efficient manner.”
Frank A. Lodzinski, CEO and President of GeoResources, stated: “Adding this asset to our existing properties will allow us to continue our profitable growth and provide additional drilling opportunities. With the multiple locations provided by this acquisition, we will be able to grow our production rate, reserves and cash flow at reasonable costs. We expect to keep a rig busy drilling on these properties for at least the next two years.”
“These two investments present excellent growth opportunities for GE working with experienced management teams,” said John Schaeffer, Managing Director and head of the Oil and Gas unit at GE Energy Financial Services. “Bays’ and Southern Bays’ experience in oil and gas development, together with GE Energy Financial Services’ deep industry knowledge and commitment, create the potential for strong operating results.”
Since 1991, the Oil and Gas unit’s 18 professionals have provided $2.75 billion in partnership equity for its independent private and public oil and gas partner-operators in the United States. Based in Stamford, Connecticut, with offices in Houston, Texas, the Oil and Gas unit’s partnership investments produce an estimated 100 million cubic feet of natural gas and 15,000 barrels of oil daily.
About Bays Exploration, Inc.
Bays Exploration, Inc., a wholly owned subsidiary of Bays Enterprises, Inc., is an experienced exploration and production company with offices in Oklahoma City, Oklahoma and Boerne, Texas. Merrill Lynch Petrie Parkman advised Bays throughout this transaction.
About GeoResources, Inc. and Southern Bay
As a result of the merger competed April 17, 2007 between GeoResources, Inc., (NASDAQ: “GEOID”, but “GEOI” effective may 17, 2007) Southern Bay Oil & Gas, L.P., and Chandler Energy LLC, Southern Bay became a wholly owned subsidiary of GeoResources. The management of Southern Bay and Chandler became the principal management of the combined entity. GeoResources and its subsidiaries and affiliates own and operate producing oil and gas properties in the Gulf Coast, Permian Basin, Rocky Mountains and Williston Basin, and conduct oil and gas exploration operations in these areas. The company headquarters and southern region operating offices are located in Houston, Texas and its Northern region office is located in Denver, Colorado. For more information, visit the company's websites at www.geoi.net and www.southernbayenergy.com
About GE Energy Financial Services
GE Energy Financial Services’ 300 experts invest globally with a long-term view, backed by the best of GE's technical know-how and financial strength, across the capital spectrum and the energy and water industries, to help their customers and GE grow. With $14 billion in assets, GE Energy Financial Services, based in Stamford, Connecticut, invests more than $5 billion annually in two of the world’s most capital-intensive industries, energy and water. More information: www.geenergyfinancialservices.com
About GE
GE (NYSE: GE) is Imagination at Work -- a diversified technology, media and financial services company focused on solving some of the world's toughest problems. With products and services ranging from aircraft engines, power generation, water processing and security technology to medical imaging, business and consumer financing, media content and advanced materials, GE serves customers in more than 100 countries and employs more than 300,000 people worldwide. For more information, visit www.ge.com
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