NorthWestern Energy Announces Natural Gas Production Acquisition in Bear Paw Basin, Montana
NorthWestern Corporation d/b/a NorthWestern Energy (NYSE: NWE) today announced the purchase of operating and non-operating natural gas production interests in northern Montana's Bear Paw Basin from NFR Energy LLC. The purchase also includes NFR Energy's 75% interest in the Lodge Creek and Willow Creek Gas Gathering Systems.
The Bear Paw Basin purchase includes approximately 600 producing wells and two connected gathering systems with over 400 miles of pipelines in Blaine, Choteau, Fergus and Hill Counties. The amount of net proven developed producing reserves purchased is estimated to be 13.4 billion cubic feet (Bcf). Net production attributable to the assets purchased will be approximately 1.6 Bcf in 2012, or about 8% of NorthWestern's current annual natural gas load in Montana.
The purchase price for the Bear Paw Basin assets including the interests in the two gathering systems was $19.5 million (subject to customary post closing adjustments). NorthWestern funded the transaction with a portion of the proceeds from its August bond issuance and with internally generated cash flows. The intent is to capitalize the asset on a long term basis at approximately 50% debt and 50% equity.
"This acquisition is part of our strategy to provide our Montana natural gas customers with a