SandRidge has signed a Letter of Intent with a large independent oil and gas company whereby SandRidge would sell certain deep acreage rights ("Deep Rights") in Oklahoma for $140 million in cash.
SandRidge has no associated proved reserves or current production from the Deep Rights located in the Cana Shale play in northwest Oklahoma. SandRidge will retain the shallow rights to the acreage.
SandRidge intends to use the proceeds from the sale to pay down existing borrowings under its credit facility. The transaction is subject to successful negotiation of a Purchase & Sale Agreement and other customary closing conditions. SandRidge expects the transaction to close in the third quarter of 2010.
The transaction does not affect SandRidge's pending merger with Arena Resources, Inc. ("Arena") and Arena has been informed of the proposed transaction.
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