Gastar Exploration, Inc. ("Gastar") (NYSE MKT: GST) announced today that its subsidiary, Gastar Exploration USA, Inc. ("Gastar USA"), closed its acquisition of Mid-Continent assets from Lime Rock Resources II-A, L.P. and Lime Rock Resources II-C, L.P. (the "WEHLU Acquisition"). Concurrently, Gastar USA announced the closing of $125 million aggregate principal amount of its 85/8% Senior Secured Notes due 2018 (the "Additional Notes"). Net proceeds from the notes offering are being used to fund a portion of the purchase price of the WEHLU Acquisition.
The WEHLU assets include a 98.3% working interest (80.5% net revenue interest) in 24,000 acres of the West Edmond Hunton Lime Unit located in Kingfisher, Logan, Oklahoma and Canadian counties, Oklahoma. All of the acreage is held by production and located adjacent to a portion of the Hunton Limestone assets that Gastar acquired earlier this year. The purchase price of the WEHLU acquisition was $172.4 million, after preliminary closing adjustments, with a purchase effective date of August 1, 2013.
Net proceeds from the notes offering were approximately $117.6 million, after issuance discount and direct underwriting fees and expenses. The Additional Notes mature on May 15, 2018 and were priced at 97.0% of the principal amount. The Additional Notes were offered as additional notes to Gastar USA's existing $200 million aggregate principal amount of 85/8% Senior Notes due 2018 that Gastar USA sold in a private placement on May 15, 2013. The Additional Notes and the notes issued on May 15, 2013 will be treated as a single class of debt securities and will have identical terms, other than the issue date.
The Additional Notes will not be registered under the Securities Act of 1933, as amended (the "Securities Act"), or the securities laws of any state and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements under the Securities Act and applicable state securities laws or blue sky laws and foreign securities laws.
About Gastar Exploration
Gastar Exploration, Inc. is an independent energy company engaged in the exploration, development and production of oil, natural gas, condensate and natural gas liquids in the United States. Gastar's principal business activities include the identification, acquisition, and subsequent exploration and development of oil and natural gas properties with an emphasis on unconventional reserves such as shale resource plays.Gastar is currently pursuing the development of liquids-rich natural gas in the Marcellus Shale in West Virginia and is also in the early stages of exploring and developing the Hunton Limestone horizontal oil play in Oklahoma.