cautions you that these forward-looking statements are subject to risks and uncertainties, and that AEPB
's actual results and plans could differ materially from those expressed in any forward-looking statements.
By adding these assets to its current leasehold position of 63,000 net acres, AEPB
says it will have established one of the sector's top leasehold positions in the Wolfcamp Shale play in Reagan County.
This transaction provides AEPB with enhanced liquidity at a very attractive cost and will enable us to continue executing our business plan while also maintaining flexibility to capitalize on opportunities and potentially accelerate drilling activity if oil and natural gas prices further improve.
I am proud of the responsiveness of the AEPB management team to challenging market conditions during the last eight months and their success in preserving attractive profit margins and investment returns through improved operational efficiencies and significant capital and operating cost improvements.
Notably, AEPB has implemented a well cost reduction initiative that has resulted in initial cost savings of approximately $1.
Additionally, to provide greater financial flexibility in 2015, AEPB and its lending group have amended the maintenance covenants in the company's revolving credit facility.
Including the Tall City acquisition, since July 31, 2014, AEPB has closed, or plans to close by year-end 2014, the acquisition of approximately 28,000 net acres of leasehold in the Wolfcamp Shale play in the Central Midland Basin, or approximately 115,000 acres on a net effective acre basis, 1,400 boe per day of production, and 49 mmboe of proved reserves, primarily located in Reagan County, Texas, for a total purchase price of approximately $720 million.
Pro forma for the acquisitions expected to be completed by year-end, AEPB estimates it will have approximately 91,000 net acres in the Wolfcamp Shale play in the Central Midland Basin, or approximately 248,000 acres on a net effective acres basis, more than 17,000 boe per day of current production, 158 mmboe of proved reserves and approximately 2,700 gross wells to be drilled in the future.
With the addition of these assets to its existing leasehold position of 63,000 net acres, AEPB
believes it will have established one of the industry's premier leasehold positions in the Wolfcamp Shale play in Reagan County.
The revolving credit facility provides AEPB
with a credit limit subject to a borrowing base, determined by reference to the value of AEPB
's oil and gas properties.
The net proceeds from the offering of each series of Notes will be used as part of the financing for the proposed acquisition by AEPB
of the Permian Basin business and assets of Enduring Resources II, LLC ("Acquisition") and for general corporate purposes.
AELP provides management services to each of AEU, AEW, AEM and AEPB
and EMG is the lead equity investor in each.