MIDLAND, Texas, Nov. 27, 2007 (PRIME NEWSWIRE) -- Legacy Reserves LP (Nasdaq:LGCY) today announced it has closed an acquisition of nine operated producing wells in the Permian Basin from a major oil company for $5.2 million, bringing its total closed acquisitions during the month of November to $15.3 million of cash purchases. The four acquisitions that Legacy has closed in November aggregate 232 Boe/d of net production, with internally estimated proved reserves of approximately 1.07 million Boe's, of which 94.5% is classified as proved developed producing. Legacy previously discussed $10 million of these acquisitions on its earnings call on November 8, 2007. Legacy has closed 14 acquisitions year to date 2007 for an aggregate purchase price of approximately $193.5 million.
Related to the acquisitions, Legacy entered into NYMEX WTI oil swaps and natural gas swaps. New WTI oil fixed price swaps are tabulated below. WTI swaps are used to mitigate risks associated with both oil and natural gas liquids sales as the price of natural gas liquids is highly correlated to that of WTI oil prices.
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Time Period Swap Volume WTI Average
Calendar Contracts (Bbls.) Price
($/Bbl)
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2008 43,200 $86.75
2009 38,400 $86.75
2010 36,000 $86.75
2011 33,600 $86.75
2012 31,200 $86.75
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Swaps are tabulated below for new natural gas fixed price swaps indexed to the Waha hub in West Texas. The Waha hub trades at a discount to the NYMEX Henry Hub natural gas index. The natural gas prices that we receive for our natural gas sales in the Permian Basin follow Waha more closely than the NYMEX Henry Hub index.
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Time Period Swap Volume Waha Natural
Calendar Contracts Gas Price
(MMBtu) ($/MMBtu)
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2008 130,800 $7.57
2009 114,000 $7.57
2010 103,200 $7.57
2011 94,800 $7.57
2012 88,800 $7.57
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About Legacy Reserves LP
We are an independent oil and natural gas limited partnership headquartered in Midland, Texas, and are focused on the acquisition and exploitation of oil and natural gas properties primarily located in the Permian Basin and Mid-continent regions. Additional information is available at www.LegacyLP.com.
The Legacy Reserves logo is available at http://www.primenewswire.com/newsroom/prs/?pkgid=3201
Cautionary Statement Relevant to Forward-Looking Information
This press release contains forward-looking statements relating to Legacy's operations that are based on management's current expectations, estimates and projections about its operations. Words such as "anticipates," "expects," "intends," "plans," "targets," "projects," "believes," "seeks," "schedules," "estimated," and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, some of which are beyond our control and are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Unless legally required, Legacy undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.
Among the important factors that could cause actual results to differ materially from those in the forward-looking statements are realized oil and natural gas prices; production volumes; lease operating expenses, general and administrative costs and finding and development costs; future operating results; and the factors set forth under the heading "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2006.