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Diversified Gas & Oil PLC Louisiana expansion is no surprise, says broker

Analysts at SP Angel said the US$135mln acquisition of the Cotton Valley package “appears to be typically attractive” and presented “clear opportunities” for growth through operational synergies

’s () acquisition of a package of assets in Louisiana should come as “no surprise”, according to analysts at broker SP Angel.

In a note on Friday, analysts said it was “a buyers’ market in the US” and the US$135mln acquisition of the Cotton Valley package, which includes some 16,000 barrels oil equivalent per day (boepd) of production across 780 net operated wells, “appears to be typically attractive” and presented “clear opportunities” for growth through operational synergies.

READ: Diversified Gas & Oil acquires operations in Louisiana as first deal in new focus area

SP Angel added that investors “can look forward to a stable dividend policy” given the company’s “strong balance sheet, efficient cost structure, improved commodity price outlook, strong hedge protection and a robust outlook of potential accretive growth”.

Shares in DGOC were up 3.7% at 122.8p in late morning trading on Friday.

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2021-04-30 05:55:00

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