Apache, Davis Oil Agree On Assets Purchase
DENVER (AP) _ Apache Corp. has announced it will pay $180 million for Davis Oil Co. holdings in eight states.
Davis Oil is owned by billionaire Marvin Davis, part-owner of 20th Century Fox Film Co. and one of the nation’s top wildcatters.
This is the second major sale by the Denver oilman in just over a week. On March 20, Davis said he was selling half his holdings in TCF Holding Co., the parent firm of 20th Century Fox, to publisher Rupert Murdoch for $162 million.
Minneapolis-based Apache, on behalf of Apache Petroleum Co., plans to buy 390 of Davis’ developed oil and gas wells in Colorado, Wyoming, New Mexico, Louisiana, Texas, Oklahoma, North Dakota and Utah, said Ray Plank, Apache Corp. chairman and chief executive officer.
The deal, announced at a news conference in Denver on Thursday, also includes more than 250 development drilling locations and partially developed prospects resulting from Davis oil discoveries, officials said.
There was no representative from Davis at the news conference. Plank said no reason was given for the sale, but ″Every indication we have is that Marv is going to continue in the oil business and is going to keep his technical staff together.″
Davis said in a news release that the sale is ″in keeping with our historic practice of periodically selling a portion of our producing properties.″
Plank said he expects the Apache sale to become final in two to three weeks. He said negotiations have been going on since Dec. 5, and the financing has been arranged.
Bill Cunningham, Apache’s executive vice president-production, said his firm plans to hire 30 to 40 of Davis’ field personnel.
One of the largest geographical areas in the agreement is Davis’ share of Wyoming’s Amos Draw Field, west of Gillette. Apache officials estimated Davis’ working interest there is 20 percent. A total of 176 producing wells in the area are part of the deal.
Apache officials said the most lucrative area is the Wilcox Prospect in DeWitt County, Texas.
Apache officials said they did not know the amount of reserves in their acquisition.
Officials said this is Apache’s second-largest acquisition to date, with the largest being a $410 million for Dow Chemical Co. properties in the fall of 1982.
They did not know what percentage of Davis’ holdings this deal represents. Davis Oil is a private company and does not have to disclose its assets.
Apache Corp. is an exploration and production company that creates, markets and manages oil- and gas-related investment products. It has offices in Denver, Houston and Tulsa.
Apache Corp. and Apache Petroleum are listed on the New York and Midwest stock exchanges. Apache Petroleum had assets of $802.5 million in 1984, and net income of $30.5 million on oil and gas sale revenues of $221.1 million.