LINN acquires BP's Hugoton Basin assets for US$1.2 billion
LINN Energy is to acquire BP's Hugoton Basin assets in southwest Kansas for US$1.2 billion. The upstream portfolio holds proved reserves of 730 bcfe, of which 81% are proved developed. Current production is 110 mmcfed - two thirds gas, one third liquids. The portfolio also includes 100% ownership of BP's Jayhawk plant - a 450 mmcfd cryogenic gas processing facility. At a 10% discount rate, deal economics do not look particularly compelling. We value the upstream assets and the ...