[Context: On October 6, Kalnin Ventures, an affiliate BKV Oil and Gas Capital Partners backed by Thailand’s Banpu Pcl, announced a $210m acquisition in Marcellus play from Carrizo Oil and Reliance Energy. Further details and related links are below.]
Kalnin Ventures Announces Fifth Marcellus Asset Acquisition; $210 Million Acquisition Makes Kalnin a Leading Player in Marcellus Play
DENVER (Oct. 6, 2017) – Kalnin Ventures LLC (“Kalnin”) today announced that an affiliate of its BKV Oil and Gas Capital Partners, LP fund (the “Fund”), has entered into Purchase and Sale Agreements with respect to the Fund’s fifth acquisition of assets in just over 2 years in the northeast portion of the Marcellus Shale. The Fund is financially backed by its sole investor, Banpu Pcl, a Thailand- based coal mining and power generation company with total assets of more than $6 billion.
The transaction is valued at an aggregate price of $210 million, with potential additional payments to the sellers of up to $18.75 million over the next three years depending on natural gas prices. Separate purchase and sale agreements were entered into with Carrizo (Marcellus) LLC and Reliance Marcellus II, LLC, to acquire their respective interests in the assets (subject to customary closing conditions), which are comprised of interests in 112 wells, including 98 producing wells, 11 drilled and uncompleted (DUC) wells and three wells that are temporarily abandoned.
The assets, which are predominantly located in Pennsylvania’s Wyoming and Susquehanna Counties, will generate cash flows for the Fund immediately and fit within Kalnin’s strategy of acquiring profitable, low-risk assets that provide strong cash flow yields.
With its fifth transaction in just over two years, Kalnin has invested, through the Fund, $417 million in the Marcellus Shale and is poised to fully invest its first fund as it continues to expand and diversify its strategy of acquiring, managing, and monetizing portfolios. With this acquisition, the Fund is now one of the top 20 natural gas producers in Pennsylvania, and Kalnin has an eye toward continued future growth.
“This deal is unique from our previous four in that it provides us the opportunity to naturally expand into an operator position while also acquiring additional midstream assets,” said Christopher Kalnin, Managing Director and Co-founder of Kalnin Ventures LLC. “However, it is similar to prior deals in that we are acquiring profitable assets and enhancing them with technology and big data. Our experience as a non-operator, and now operator, coupled with our high-quality asset base and proprietary technology, has put us in a compelling position to expand further in the Super Core of the Marcellus.”
The acquisition follows the Fund’s previous transactions with Zena Energy LLC, Radler 2000 LP – Tug Hill Marcellus, LLC; Chief Exploration and Development LLC; and Range Resources – Appalachia, LLC, all located in the productive Marcellus Shale.
Upon completion of this transaction, the Fund will have an interest in 355 active wells. These transactions provide the Fund with net natural gas production of 160 million cubic feet per day. Willkie Farr & Gallagher LLP acted as legal advisor to Kalnin and the Fund on the transactions.
About Kalnin Ventures
Kalnin Ventures is a values?driven firm that believes that the combination of visionary strategy, focus on execution, and balance in day-to-day life are the keys to creating long?term sustainable value.
Kalnin Ventures is backed by investors with equity fund commitments of $500 million within its oil and gas fund BKV Oil and Gas Capital Partners, L.P. The company seeks to invest in attractive upstream oil and gas opportunities in North America with the goal of creating long?term sustainable value in the energy industry.
Banpu Pcl is listed on the Stock Exchange of Thailand and is now one of the energy leaders in the Asia-Pacific region with widespread experience in a variety of domestic and international energy industries. Banpu is focused on developing and investing in coal, power generation and alternative energy investments, with investments located in Thailand, Indonesia, China, Australia, Lap PDR, Mongolia, Singapore, Japan and the United States.