US-based independent exploration and production company Viking Energy Group is set to acquire an undisclosed company with producing, conventional oil and gas assets with development potential, in a deal valued at $25m.

The company is currently in final negotiations with regards to the acquisition process.

Based on preliminary due diligence, it was determined that the target company has a working interest in around 12 oil and gas fields, with an estimated value of total proved reserves worth $49.1m.

The proposed acquisition comprises a current production of about 1,200 barrels of oil equivalent per day and leases to 11,629 gross acres / 9,360 net acres.

In addition, the undisclosed company is targeting conventional oil and gas utilising 3D seismic data and amplitude versus offset (AVO) analysis of the final data.

According to Viking Energy, multiple locations belonging to the proposed assets have been high-graded and can be immediately drilled and completed.

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"The proposed acquisition comprises a current production of about 1,200 barrels of oil equivalent per day and leases to 11,629 gross acres / 9,360 net acres."

The majority of the assets being acquired come with 3D seismic data.

Additionally, the target company has identified and vetted numerous future drilling locations as part of a three-year drilling programme.

As part of the transaction, Viking will make an initial payment of $10m at closing, with the remaining amount to be paid six months from the closing date at a rate of 8% per annum.

Viking noted that it received conditional approval from its lending bank.

The proposed effective closing date of the potential acquisition transaction is 1 July.

The completion of the entire transaction is subject to Viking and the seller executing definitive legal documentation on terms and conditions acceptable to both parties, and the commercial bank approving such legal documentation.

Viking focuses on the acquisition and development of oil and natural gas properties in North America and owns oil and gas leases in Kansas, Missouri and Alberta.