Approach Resources To Sell Interest In Southern Midland Basin Oil Pipeline

(RTTNews) - Approach Resources Inc. (AREX) announced a definitive agreement to sell its interest in an oil pipeline system in the southern Midland Basin for cash proceeds to Approach of $108 million, before taxes and subject to customary post-closing conditions, adjustments and escrows.

Approach, together with its partner in Wildcat Permian Services LLC, entered into an Equity Purchase Agreement with affiliates of JP Energy Development LP, under which JP Energy will acquire all of the equity interests in Wildcat for a purchase price of $210 million, subject to customary post-closing conditions, adjustments and escrows. The transaction is expected to close in late third quarter or early fourth quarter 2013.

Wildcat owns and operates an oil pipeline system consisting of approximately 50 miles of high-pressure, steel pipeline in Crockett and Reagan Counties, Texas, with throughput capacity of 100,000 Bbls/d, truck terminal and LACT bay facilities, multiple receipt points and 40,000 Bbls of crude oil storage.

In connection with the acquisition of Wildcat, JP Energy and Approach will enter into a revised crude oil purchase agreement under which JP Energy will purchase and transport the Company's crude oil production from Crockett and Schleicher Counties, Texas.