While most buyers of Orange County land are looking to build homes or commercial buildings, Pittsburgh-based Linn Energy LLC has bought a chunk of property for what’s underneath it.
Linn Energy shelled out $291 million for the Brea Olinda Field oil reserves in North County. The oil and gas company bought the site from Houston-based Blacksand Energy LLC in a deal that wrapped up earlier this month.
The Brea Olinda Field is California’s 16th-largest oil reserve with about 31 million barrels of oil in the ground.
Blacksand Energy investors include funds run by Kayne Anderson Capital Advisors, which has offices in Los Angeles and Houston, New York-based Jefferies Capital Partners and Wells Fargo Energy Capital.
Acquisitions and development in the oil industry have surged as prices skyrocketed during the past four years.
Linn Energy’s interest in California oil reserves is no surprise, said Rock Zierman, director of public affairs with the California Independent Petroleum Association in Sacramento.
California is the nation’s third-largest oil-producing state with about 740,000 barrels of oil pumped each day. Only Texas and Alaska produce more.
Linn Energy couldn’t be reached for comment. The company said in a release that its OC acquisition will give it 270 wells that should last for 39 years.
The company said it expected to keep Blacksand Energy’s employees at the Brea site.
For more on this story, see the Aug. 14 edition of the Business Journal.
