Plains Exploration To Acquire Eagle Ford Shale

In a recent Dahlman Rose note, Plains Exploration's

announced an acquisition of Eagle Ford Shale properties and provided an operations update. Its newly acquired Eagle Ford Assets should drive growth in oil production. Dahlman Rose is increasing its Price Target from $33 to $35. Plains has agreed to purchase 60K net acres in the Eagle Ford Shale for $578MM in cash. Plains will have a 100% working interest in 40K acres of the acquired properties, and a 50% working interest in 40.8K gross acres that are included in its joint venture with EOG Resources. Risks to achieving the target price include exposure to oil prices and its growth profile driven by its Haynesville Shale, Eagle Ford Shale and Granite Wash Assets. PXP is trading lower at $28.28