================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) March 8, 2002
CONTANGO OIL & GAS COMPANY
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 000-24971 95-4079863
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
3700 BUFFALO SPEEDWAY, SUITE 960
HOUSTON, TEXAS 77098
(Address of principal executive offices)
(713) 960-1901
(Registrant's telephone number, including area code)
N/A
(Former name or former address, if changed since last report.)
================================================================================
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
Contango Oil & Gas Company entered into an Asset Purchase Agreement with
the Southern Ute Indian Tribe doing business as Red Willow Production Company
("SUIT") to purchase all of the working and revenue interests of SUIT in
Contango's south Texas exploration program properties ("STEP") effective as of
January 1, 2002.
Contango paid approximately $7.0 million in cash and funded the
acquisition with cash on hand and increased availability under an expanded $20
million secured natural gas and oil revolving credit facility provided by
Guaranty Bank, FSB.
Contango acquired SUIT's interests in 38 onshore producing oil and gas
wells located in Jim Hogg and Brooks Counties, Texas. The net proved developed
producing reserves of natural gas and oil for the acquired properties as of
January 1, 2002 are estimated to be approximately 4.2 Bcfe for an acquisition
cost of approximately $1.49 per Mmbtue. As a result of this acquisition, the
Company's working and net revenue interest in these wells was increased from
approximately 56% and 42% to approximately 67% and 50%, respectively. Daily net
production has increased from approximately 20 Mcfe to 25 Mcfe. The acquisition
price is based on the monthly NYMEX prices for natural gas and oil as of January
28, 2002 adjusted for basis, btu and transportation differentiations, with cash
flows discounted at 10%.
A copy of the press release issued by Contango on March 8, 2002 concerning
the acquisition is attached hereto as Exhibit 99.1 and is incorporated herein by
reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(C) EXHIBITS
The following is a list of exhibits filed as part of this Form 8-K. Where
so indicated by footnote, exhibits, which were previously filed, are
incorporated by reference.
Exhibit No. Description of Document
- ----------- -----------------------
10.1 Asset Purchase Agreement by and among Southern Ute Indian Tribe
doing business as Red Willow Production Company and Contango Oil
& Gas Company dated January 28, 2002.
99.1 Press Release issued March 8, 2002.
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CONTANGO OIL & GAS COMPANY
Date: March 15, 2002 By: /s/ KENNETH R. PEAK
-------------------
Kenneth R. Peak
President and Chief Executive Officer
Date: March 15, 2002 By: /s/ LESIA BAUTINA
------------------
Lesia Bautina
Controller
(Principal Accounting Officer)
3