Alliance Resource Partners (ARLP) made an official announcement, which conveyed completion of the acquisition of AllDale with a purchase amount of nearly $175 million, as per the previous announcement. This, in turn, enabled a control of nearly 42,000 net acres of royalty vis-à-vis areas with large-scale oil & gas accumulation. ARLP is one of the largest and diversified natural resource firm which generates revenue from coal production along interests apropos of oil and gas minerals found across strategic producing regions throughout United States.
“Ultimate closing of this transaction with AllDale is likely to provide ARLP with noteworthy ownership of highly-profitable oil & gas mineral interests,” stated Joseph W. Craft III, CEO and President. “This transaction is also foreseen to build the base for a remarkable growth of the company”, he added. The substantive income that will be procured from the aforementioned mineral interests is poised to be instantly profitable to ARLP’s revenue footprint in the year 2019 and also creates anticipations for an optimistic stream of royalty, which will offer long-term profit-making opportunities for the unit holders of ARLP.
Details of the Transaction
ARLP successfully completed the acquisition all the general partner interests of AllDale, which has been acknowledged as a viable and useful addition to the ARLP product portfolio. On the basis of the price concerned with this partnership interest, ARLP is likely to procure a gain ranging in between $145.0- $155.0 million in the first quarter of 2019, which will be a noncash gain, in order to reflect a fair and reasonable value of its past investments in partnerships with AllDale. ARLP’s acreage is being proactively developed by some of the industry-leading operators, such as Devon Energy, Continental Resources, Concho Resources, and Anadarko Petroleum.
At present, there are around 3,821 gross production wells involved in generation of production net to the interest of ARLP’s interest of nearly 2,611 oil equipment barrels for one day. As per the current statistics, around 495 wells are subjected to drilling at ARLP’s acreage and another count of around 860 well locations that are permitted. ARLP has an ownership of nearly 4,000 net acres via its partner interests, which are limited in number, in AllDale Minerals III, L.P. This strategic move is expected to enhance the current operational statistics of the company and also induce a shared responsibility in terms of risk and costs.