•  
  •  
  •  
  •  
  •  
  • Untitled Document
    Untitled Document

    Pioneer Natural Resources looks to sell Barnett assets to pursue Permian, Eagle Ford properties

    Looking to capitalize on higher rates of return from its Permian and Eagle Ford positions, Pioneer Natural Resources Co. said Thursday that it is looking to sell the 155,000 gross acres in the Barnett Shale that it has accumulated since entering the play in 2007.

    According to the Dallas, TX-based oil and gas exploration and production company, two-thirds of the acres are located in the liquids-rich Barnett Shale Combo play. The remaining one-third are located in the dry gas area. Production has grown to roughly 7,000 barrels oil equivalent per day, of which approximately 55% is liquids (oil and natural gas liquids) and 45% is dry gas.

    Proceeds from the sale could reach $670 million at $50,000/boe and $4,000/acre for 80,000 combo acres, noted analysts at Global Hunter Securities (GHS) following the announcement.

    Gearing up for Permian, Eagle Ford
    Scott Sheffield, chairman and CEO, stated, “The sale of our Barnett Shale properties will allow us to strategically reallocate capital to our higher-return, core assets in the Spraberry vertical play, the horizontal Wolfcamp Shale play and the Eagle Ford Shale. We plan to utilize the net proceeds from the divestiture to reduce indebtedness under Pioneer's credit facility.”

    Pioneer's September investor presentation shows the company drilled 34 Eagle Ford wells in Q2 2012 and 37 wells were placed on production. Twelve rigs are currently running and gross well cost are estimated at $7 million to $8 million per well. The company's 2012 drilling program in the play (estimated at 125 wells) continues to focus on liquids-rich drilling with only 10% of the wells designated to hold strategic dry gas acreage.

    In March of this year, the company paid $297 million for Carmeuse Industrial Sands to secure supply for fracture stimulation of its Texas assets. And while the Eagle Ford program continues to grow, the real ramp up may be in the company's Permian holdings.

    “To us this shows how confident PXD is in its massive 900K gross acre position in the Permian’s Midland Basin. We think that reallocating capital to the best plays and shedding non-core assets destined to take the backseat in terms of development is almost always a savvy strategic move,” noted GHS analyst Mike Kelly.

    The company is targeting completion of the divestiture process during the first quarter of 2013. RBC Richardson Barr has been engaged to market the assets for the company.

    Most Popular

    Related Articles

    Enterprise acquires Eagle Ford midstream assets

    06/05/2015 Enterprise Products Partners LP has executed definitive agreements to purchase all of the member interests in EFS Midstream LLC from affiliates of Pioneer Natural Resources Co. and Reliance Industr...

    Magellan Midstream elects additional board member

    04/24/2015

    Magellan Midstream Partners LP has appointed Stacy P. Methvin to the partnership's board of directors as an independent director at its annual meeting of limited partners held April 23.

    Pioneer updates commodity derivatives schedule

    01/07/2015 Pioneer Natural Resources Co. has converted approximately 85% of its 2015 oil derivative contracts from three-way collars to fixed-price swaps. Pioneer’s 2015 fixed-price oil swaps cover 82,000 bar...

    Producing industry-ready engineers

    11/19/2014

    Industry donations make an impact on Texas Tech

    Digital H2O’s oilfield water intelligence and management platform ready for Texas

    11/18/2014

    Digital H2O has launched Water Asset Intelligence, an oilfield water market intelligence and management platform.

    Revenue up 3%, income 13% from 1Q

    11/17/2014 Revenues and net income for the group of publicly-traded US-based companies tracked by Oil & Gas Journal and Oil & Gas Financial Journal continued their upward trend in the second quarter o...

    More Oil & Gas Financial Articles

    Enterprise acquires Eagle Ford midstream assets

    Fri, Jun 5, 2015

    Enterprise Products Partners LP has executed definitive agreements to purchase all of the member interests in EFS Midstream LLC from affiliates of Pioneer Natural Resources Co. and Reliance Industries Ltd. for $2.15 billion.

    Magellan Midstream elects additional board member

    Fri, Apr 24, 2015

    Magellan Midstream Partners LP has appointed Stacy P. Methvin to the partnership's board of directors as an independent director at its annual meeting of limited partners held April 23.

    Pioneer updates commodity derivatives schedule

    Wed, Jan 7, 2015

    Pioneer Natural Resources Co. has converted approximately 85% of its 2015 oil derivative contracts from three-way collars to fixed-price swaps. Pioneer’s 2015 fixed-price oil swaps cover 82,000 barrels of oil production per day at an average NYMEX price of $71.18 per barrel.

    Producing industry-ready engineers

    Wed, Nov 19, 2014

    Industry donations make an impact on Texas Tech

    Digital H2O’s oilfield water intelligence and management platform ready for Texas

    Tue, Nov 18, 2014

    Digital H2O has launched Water Asset Intelligence, an oilfield water market intelligence and management platform.

    OGFJ photo of the day


    Click to view slideshow

    Oil & Gas Jobs

    Search More Job Listings >>
    Subscribe to OGFJ