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Range Resources Progresses Strategic Merger With International Petroleum

Range Resources (ASX:RRS) has progressed its proposed strategic merger with International Petroleum with a formal offer likely in the coming 3-4 weeks.

Since announcing the merger transaction, key legal, technical, corporation and financial advisors have been appointed to conduct due diligence.

The transaction is likely to be done as an off-market takeover offer by Range to International Petroleum shareholders.

Range has already advanced US$8 million of the US$15 million secured financing to International Petroleum as part of the merger process, with the remaining likely to be forwarded in the coming two weeks.

Range Resources had in April unveiled plans to merge with International Petroleum under which it would offer three ordinary Range shares to International shareholders for every two shares they hold.

International holds highly prospective assets in Russia, Kazakhstan, and Niger with total 3P Reserves of 233 mmbbls of oil and best estimate prospective resources of 761 mmbbls of oil and 157 Bcf of gas.

The new entity would hold estimated 1P, 2P and 3P reserves of 23.6 mmbbls, 100 mmbbls and 264 mmbbls of oil respectively, and best estimate prospective resources of 802 mmbbls of oil and 156 Bcf of gas.

Once the merger transaction goes through, the combined production of the two entites under 'new Range' would be approximately 1,000 bopde, with a target of increasing production to 10,000 bopde from conventional operations and an additional 3,000 bopde from unconventional operations by the end of 2015.

The key near term focus of the merged entity will be the expansion and development of the projects in Trinidad, Russia and onshore Africa.

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