Norse Announces Definitive Agreement to Sell Acreage & Overriding Royalty Interests for Proceeds of USD 26.7 Million
Norse Energy Corp. ASA (“NEC” ticker Oslo Stock Exchange, Norway; “NSEEY” ticker U.S. OTC) announces that it has entered into a definitive agreement to sell acreage and overriding royalty interests for cash consideration of USD 26.7 million to undisclosed and unrelated buyers.
Norse is selling leases and fee interests totaling approximately 22,700 acres in Central New York and overriding royalty interests of (i) 2.5% on 24,300 acres that are held by production ("HBP") in Central New York; (ii) 3.75% on 84,000 non-HBP leased and fee acres located in Central New York; and (iii) 6.25% on 33,000 acres located in Western New York.
Not included in this transaction are the Company’s proved reserves, including those reserves in the Herkimer Formation.
Upon closing, Norse received USD 21.7 million as the first installment. The remaining cash consideration of USD 5 million will be held in escrow to allow the buyers adequate time to conclude confirmatory due diligence, whereupon the remaining funds will be disbursed to Norse no later than March 31, 2012.
“This transaction represents an important first step in providing liquidity for the company and reflects renewed interest in our New York acreage,” commented Norse CEO Mark Dice. “Norse remains hopeful that the SGEIS approval process will be complete so that development of our significant shale resources can commence in 2012,” concluded Dice.
Following this sale, the Company retains a significant land position of approximately 160,000 net acres in New York State of which approximately 110,000 net acres are in the Marcellus and Utica shale fairway in Central NY.
For further information, please contact:
J. Chris Steinhauser, Chief Financial Officer
Phone: +1 716 568-2048 Email:
S. Dennis Holbrook, Chief Legal Officer
Cell: +1 716 713-2489 Email: