BreitBurn Energy to buy Belridge Field oil assets in US

US-based BreitBurn Energy Partners is acquiring key oil assets located in Belridge Field in Kern County, California, US, for about $40m in cash.

The acquisition includes 3,013,561 common units, representing limited partner interests in the partnership, and is expected to complete in 2012, following necessary approvals and purchase price adjustments.

As of October 2012, the acquired properties have an average net production of about 825 Boe per day (85% oil). Proved reserves are estimated to be around 3.8 MMBoe, as of 1 November 2012.

The reserve life index of the assets is over 12 years, based on estimated proved reserves, while current oil production capacity is 29 AP gravity.

BreitBurn CEO Hal Washburn said that the company is pleased to be acquiring good quality oil assets in California, where the company has been operating for a long time and has extensive expertise.

"The Belridge Field is one of the largest fields in California, with significant oil in place, and these long-lived assets will provide us with attractive growth opportunities to further increase our oil drilling inventory.

"These assets will add to our high quality California oil production being sold based on Brent crude which is currently priced at approximately $110 per barrel, representing a significant premium over WTI.

"This is our fourth acquisition in 2012, bringing the total value of the acquisitions year to date to over $400m, demonstrating our ongoing commitment to our growth through acquisitions strategy," added Washburn.

The cash to fund the acquisition will come from borrowings under BreitBurn’s bank credit facility.