Client:

Empire Energy Group Limited (EEG) is an oil and gas exploration and production company operating in the Appalachian Basin and Mid-Continent regions of the United States. A key strategic goal of the company is the continued building of its oil and gas portfolio of assets.

Issue:

Perkins Coie has represented EEG in connection with acquisitions and other matters for a number of years. EEG wanted to expand its production and exploration portfolio to include onshore, liquid hydrocarbon fields along the coast of the Gulf of Mexico, with a focus on East Texas and Louisiana. EEG entered into discussions with a potential acquisition, an exploration company purported to hold exploration and production rights in certain salt-dome fields in Louisiana and, to a lesser extent, East Texas.

Challenge:

EEG asked Perkins Coie attorneys for guidance in determining whether the representations made by the potential target company during initial discussions were correct with respect to rights that the company purported to hold.

Solution:

We conducted significant diligence review and in-person meetings with the executives of the target company. In addition, we directed landmen in conducting a review of the applicable title documents. Over the course of our review, we discovered that many of the rights that the target company purported to hold were not actually possessed by it. This suggested this would create a significant execution risk and lower valuation. As a result of the information we unearthed, EEG elected to pursue more advantageous opportunities. EEG exited from the transaction at an early stage and saved significant time and money.