SOURCE: High Plains Gas

November 23, 2010 09:48 ET

CEP M Purchase LLC, a 51% Owned Subsidiary of High Plains Gas, Inc., Closes Transactions and Acquires 155,000 Net Operating Acres Spanning Multiple Gas Fields in the Powder River Basin From Marathon Oil Corporation

GILLETTE, WY--(Marketwire - November 23, 2010) -  High Plains Gas, Inc. (OTCBB: NXPN) today announced that through its 51% owned subsidiary, CEP M Purchase LLC ("CEP"), it has closed on the acquisition of the Gas Fields, known as the "North & South Fairway" assets, located in the Powder River Basin from Marathon Oil Corporation through a wholly owned subsidiary.

This acquisition of coal bed methane properties represents a significant resource base and land position, encompassing approximately 155,000 net operated acres.

The acquisition includes the operational capacities including flow lines, transportation rights and production wells (both active and idle). The transaction does not include any transfer of deep oil and gas rights, but is focused upon mineral rights between the surface and depth above the base Tertiary Paleocene Fort Union Formation generally above 2,500 feet.

"This acquisition, coupled with our option to purchase the remaining 49% of CEP, marks a new chapter in the growth of High Plains. The Fairway Assets are a perfect fit for the experience and expertise the Company has in refurbishment and reactivation of coal bed methane wells," said Mark Hettinger, Chairman of High Plains Gas.

Asset Highlights

  • Current Production: ~17,000 Mcfpd - Gross/~13,600 Mcfpd-Net
  • Over 1,600 Coal Bed Methane Wells
  • Acreage Position: 155,000 Net Acres ( > 90% Held by Production)
  • Average Working Interest: 97%
  • Average Net Revenue Interest: 80%

"The acquisition of the Marathon assets catapults High Plains into being a significant natural gas producer in the Powder River Basin. The operating acumen of Mark Hettinger, with the market savvy of Brent Cook, CEO of Current Energy, is thrusting High Plains into a rapid growth phase," said Ed Cabrera, Head of Investment Banking for Aegis Capital.

High Plains Gas, Inc. is a Gillette, Wyoming-based energy company actively engaged in the acquisition, development and production of natural gas primarily in the Powder River Basin. The Company currently maintains seven active leases in the region with 92 wells producing natural gas. With a strong foundation in the basin and growth as a core value, High Plains Gas will pursue expansion opportunities for the profitable production and transmission of natural gas. High Plains Gas also believes it has unique experience and expertise in the refurbishment and reactivation of wells that produce gas from coal bed methane formations.

Cautionary Language:

Statements made about our future expectations are forward-looking statements and subject to risks and uncertainties as described in our most recent filings made with the US Securities and Exchange Commission, and are subject to change at any time. Our actual results could differ materially from these forward-looking statements. We undertake no obligation to update publicly any forward-looking statement.

Contact Information