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Friday, August 26, 2011

Mid-Con Energy Seeks Approval for IPO

- Mid-Con Energy Seeks Approval for IPO

Friday, August 26, 2011
Tulsa World, Okla.
by Rod Walton

Privately held waterflood oil producer Mid-Con Energy LP is seeking federal approval for an initial public offering as a master limited partnership.

The form S-1 registration request, filed earlier this month with the U.S. Securities and Exchange Commission, estimates a maximum of $140 million in equity from the proposed IPO. If granted, Mid-Con Energy hopes to be listed on the Nasdaq electronic exchange under the ticker symbol MCEP.

"Our management team has significant industry experience, especially with waterflood projects and, as a result, our operations focus primarily on enhancing the development of producing oil properties through waterflooding," the S-1 filing reads.

Mid-Con President Randy Olmstead founded the company seven years ago with capital from equity firm Yorktown Partners. Mid-Con's operating subsidiary, RDT Properties Inc., was started in 1986 to buy and operate mature waterflood properties.

The new partnership was incorporated last month in Delaware. Mid-Con Energy's production is focused on properties in southern and northeastern Oklahoma and Colorado.

The fields "primarily consist of mature, legacy onshore oil reservoirs with long-lived, relatively predictable production profiles and low production decline rates," the federal filing reads. More than 90 percent of Mid-Con's properties are produced under waterflood techniques, in which water is injected into the reservoir formation to displace residual oil and into adjacent production wells.

Mid-Con Energy's proved reserves totaled an estimated 7.9 million barrels of oil equivalent, most of that crude oil.

The master limited partnership structure eliminates corporate taxes on profits. The MLP is required to distribute much of its available cashflow through distributions to unitholders, who are taxed on those payouts.

Mid-Con is the fourth Tulsa energy firm to go public or announce a planned IPO in recent months. On Wednesday, Laredo Petroleum filed its own SEC papers seeking an initial public offering raising up to $450 million in equity.

Tulsa-based propane marketer NGL Energy Partners LP held its IPO earlier this year and is listed on the New York Stock Exchange.

Williams Cos. Inc. plans to set a partial IPO for its exploration and production subsidiary, WPX Energy Inc., later this year. The rest of WPX will be separated in a tax-free spinoff to Williams shareholders in 2012, according to reports.

Copyright (c) 2011 Tulsa World (Tulsa, Okla.)

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