Certain of Plains Exploration and Production's (PXP) subsidiaries have entered into a definitive purchase and sale agreement with XTO Energy Inc. (XTO) to sell PXP's interests in oil and gas properties located in the San Juan Basin in New Mexico and in the Barnett Shale in Texas.
The properties currently generate sales volumes of approximately 3,000 BOEPD and have approximately 17 million BOE estimated proved reserves as of December 31, 2006. Under the terms of the agreement, PXP will receive $180 million of cash and XTO's 50 percent working interest in the Big Mac 3-D prospect area located on the Texas Gulf Coast.
PXP will have a 100 percent working interest in the Big Mac 3-D prospect area, covering approximately 50,000 net lease acres in the 275 square mile 3-D. The transaction effective date is January 1, 2008 and is expected to close on or before the end of the first quarter 2008 subject to customary closing conditions and adjustments.
Lehman Brothers Inc., J.P. Morgan Securities Inc. and Jefferies Randall & Dewey acted as financial advisors to PXP on these transactions.
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