Pedevco to buy $30M in oil wells, acreage in Northern Colorado

Pedevco Corp. (NYSE MKT: PED) said Wednesday that it reached an agreement to buy an interest in 40 oil and natural-gas wells in Northern Colorado for $30 million in cash.

Pedevco Corp., doing business as Pacific Energy Development, will operate 11 of those wells while gaining stakes in the remaining wells. The transaction will add to the five wells that California-based Pedevco already operates in Weld and Morgan counties, a Pedevco spokeswoman said.

The transaction includes about 28,000 acres in Weld county and almost 500 acres in Morgan County, Pacific Energy said in a statement.

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Pedevco expects to close the deal with an undisclosed oil company in mid-February with an effective date of Dec. 1, 2013.

“This acquisition will transform our company into one of the major players in the prolific Niobrara play,” Pacific Energy CEO Frank Ingriselli said in a statement. “It offers us a unique opportunity to significantly increase our daily production in the (Denver-Julesburg) Basin and increase our acreage by over tenfold and also provides us entry into the exciting Wattenberg area.”

The lucrative Wattenberg field, where Pedevco will gain about 2,200 acres, extends from north of Denver well into Weld County.

Pedevco will hold a conference call Thursday to discuss the acquisition as well as its current operations.