Laredo Petroleum Holdings Inc. has agreed to sell its assets in the Anadarko Basin in Western Oklahoma and Texas to EnerVest Ltd. affiliates. The sale price is $438 million and Laredo will use the proceeds for drilling activities in the Permian Basin, Reuters reported.
Through this transaction, EnerVest will acquire about 104,000 net acres of leasehold that is held by Laredo.
"Portfolio rationalization allows LPI to plow more capital into Permian where de-risking could add $10+/sh of value," commented analysts at Tudor Pickering Holt in a May 22 analysis. "Deal price is in-line with our $430 million estimate."
Laredo, an independent energy company headquartered in Tulsa, Ok. holds oil and natural gas properties in the Permian and Mid-Continent regions of the United States, produced about 4.9 billion cubic feet of liquids-rich natural gas and about 49,000 barrels of crude oil and condensate from the Anadarko Basin in the first quarter of 2013.
"The Anadarko Basin has been a meaningful part of Laredo's rapid growth in reserves and production for the past five years," said Randy A. Foutch, Laredo chairman and chief executive officer, in a statement. "However, the continued success that Laredo is experiencing with its Permian-Garden City properties makes this an ideal time to re-deploy capital from this transaction into what we believe is an even higher returning project in the Permian Basin."
Laredo expects to add two horizontal rigs in its Garden City area of the Permian Basin in west Texas upon completion of the deal, bringing the total to six horizontal drilling rigs. This will most likely occur during the third quarter, the company stated in a press release. Laredo's Permian Basin acreage contains up to 1,825 feet of pay from four defined stacked shale zones with proven horizontal development potential, the company added.
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