IRVING, Texas, Sept. 28, 2017 (GLOBE NEWSWIRE) -- Blue Ridge Mountain Resources, Inc. (“BRMR”) announced today that it has entered into a definitive agreement to divest 100% of BRMR’s equity investment in Eureka Midstream Holdings, LLC (“Eureka Holdings”) to an undisclosed buyer. Eureka Holdings owns 100% of the equity in Eureka Midstream, LLC (“Eureka Midstream”), which owns and operates approximately 340 miles of high pressure and low pressure gas gathering pipelines located in Ohio and West Virginia.
Under the terms of the agreement, BRMR will sell its equity interest in Eureka Holdings in exchange for an undisclosed amount of cash, payable in full at closing, and modification of the terms of the existing gas gathering agreement between Triad Hunter, LLC, a wholly-owned subsidiary of BRMR, and Eureka Midstream.
BRMR plans to use the cash proceeds from the transaction to pay down debt and fund its on-going development program.
The closing of the transaction is scheduled for early October 2017 and is subject to the satisfaction of customary closing conditions.
John Reinhart, President and CEO of BRMR, commented, “We are very pleased with the terms of this transaction. Monetizing this portion of our business accelerates and de-risks the realization of value for the company’s Eureka Midstream investment, is expected to substantially improve company cash flows, provides competitive gas gathering terms for future BRMR development, and provides cash for debt retirement and development operations. We are excited to focus our full attention on the development of our great upstream assets and accelerate the growth and value of our company for the benefit of our shareholders.”
Eureka Midstream owns and operates a gas gathering system located in West Virginia and Ohio with gathering and compression services in the prolific Utica Shale and Marcellus Shale plays. The system delivers gathering services for wet and dry gas and possesses attractive optionality for downstream markets with interconnecting points of delivery into local markets as well as the REX and ROVER pipelines.
About Blue Ridge Mountain Resources
Blue Ridge Mountain Resources, Inc. and subsidiaries are an Irving, Texas based independent exploration and production company engaged in the acquisition, development and production of natural gas and natural gas liquids. Blue Ridge Mountain Resources, Inc. is active in two of the most prolific unconventional shale resource plays in North America, the Marcellus and Utica Shales, with production of 80 mmscfe/d from 105,000 net effective acres.
This press release contains forward-looking statements regarding future events and future performance of BRMR and its subsidiaries. All statements other than present and historical facts contained in this press release, including statements concerning the closing of the sale by BRMR of its equity investment in Eureka Holdings, the proposed use of proceeds from such sale and future financial and strategic results of operations of BRMR and its subsidiaries, are forward-looking statements. The forward-looking statements are based on current expectations, estimates and projections that involve a number of risks and uncertainties, which could cause actual results to differ materially from those reflected in the forward-looking statements. These risks include, but are not limited to, (i) inability of the parties to close on the sale by BRMR of its equity investment in Eureka Holdings as currently anticipated, (ii) inability of BRMR and its subsidiaries to execute on strategic plans and meet goals, (iii) inability to realize the expected value and benefits of the modifications to the terms of the existing gas gathering agreement referred to above and (iv) risks associated with the oil and gas industry in general. Although BRMR believes that the expectations, estimates and projections reflected in the forward-looking statements are reasonable, BRMR can give no assurance that such expectations, estimates and projections will prove to be correct.
Source: Blue Ridge Mountain Resources, Inc.