Leasehold Acquisition And Related Issuance Of Common Stock
|6 Months Ended|
Jun. 30, 2016
|Land Acquisition And Related Issuance Of Common Stock||
(14)Leasehold Acquisition and Related Issuance of Common Stock
On June 9, 2016, we entered into an agreement to acquire approximately 55,000 net acres of Marcellus Shale leasehold located primarily in Wetzel, Tyler, and Doddridge Counties in West Virginia, including approximately 14 MMcfe per day of net production, for a purchase price of approximately $450 million. The transaction is expected to close in the third quarter of 2016.
Additionally, in July 2016, a third party exercised its 30-day option to sell the remaining working interest in the acquired properties, or an additional 11,500 net acres, to us on similar terms. The exercise of this option will increase the total purchase price for the acquisition by approximately $95 million, resulting in a total purchase price for the acquisition of approximately $545 million.
To finance the acquisition, on June 15, 2016 we issued 26,750,000 shares of our common stock and realized proceeds from the sale of approximately $753 million, net of offering expenses. We also granted the underwriters a 30-day option to purchase an additional 4,012,500 common shares. In July 2016, the underwriters partially exercised the option and purchased an additional 3,012,500 shares, resulting in additional net proceeds from the offering of approximately $85 million. In addition to funding this acquisition, the offering proceeds will be used for general corporate purposes, including funding future development of the properties.