Company on track to monetize $1 billion to help fund 2010 CAPEX
Independent energy company Petrohawk Energy Corp. has entered into an agreement to sell its interest in the West Edmond Hunton Lime Unit (WEHLU) Field in Oklahoma County, Okla. to a private company for $155 million. The sale is the first of four asset packages expected to be sold by the Houston-based company during 2010.
"Our 2010 divestiture plan is well underway with progress made on all fronts. This sale of our non-core property at WEHLU in Oklahoma is an important first step in this endeavor," said Floyd C. Wilson, chairman and CEO.
As of December 31, 2009, Petrohawk had estimated proved reserves of 23 billion cubic feet of natural gas equivalent (bcfe) associated with its interests in WEHLU. Current production is roughly 12 million cubic feet of natural gas equivalent per day (MMcfe/d). Closing is expected to occur on or before April 30, 2010, with an effective date of April 1, 2010.
RBC Richardson Barr acted as marketing and financial advisor to Petrohawk in connection with the sale.
Additional divestitures and analysis
Additionally, the company has completed a portion of an additional 2010 divestiture package. Two transactions involving properties in the Mid-Continent region have been closed for a sale price totaling approximately $20 million. These include, in total, approximately 7 bcfe of estimated proved reserves and approximately 3 MMcfe/d of production.
The $175 million of assets were monetized for $11,667 per flowing Mcfe and $5.83 per Mcfe of proved reserves. Analysts with Madison Williams Equity Research say the transactions “yielded impressive results and are a step in the right direction toward the monetization of $1 billion of assets to help HK [Petrohawk] fund its 2010 capital budget.”
The sale tops last year's fourth quarter asset divestiture to another private company by $221 million. In September 2009, Petrohawk agreed to sell its Permian Basin properties to a private company for $376 million in cash in order to focus on assets in the Haynesville and Eagle Ford Shales.
Petrohawk Energy is engaged in the acquisition, production, exploration and development of natural gas and oil with properties concentrated in North Louisiana, Arkansas, South Texas and East Texas.