Pioneer Sells Non-Strategic Canadian Properties for $207 Million
Pioneer Natural Resources has signed a definitive agreement for the sale of its Martin Creek, Conroy Black and Lookout Butte oil and gas properties to Ketch Resources Ltd. for proceeds of approximately $207 million. The transaction is expected to close by May 31, 2005 with a March 1, 2005 effective date and is subject to normal closing conditions.
Pioneer announced that it was initiating a process to divest these three non-strategic Canadian properties late last year. As of the effective date, the properties' net proved reserves were estimated to be approximately 9 million barrels oil equivalent (BOE) and current net production is averaging approximately 3,000 BOE per day. Tristone Capital acted as Financial Advisor for this transaction with TD Securities as Lead Strategic Advisor and Scotia Capital as Strategic Advisor.
Scott D. Sheffield, Pioneer's Chairman and CEO, stated, "We had strong interest in the divestiture package and are very pleased with the sales price. Combined with our excess cash flow and proceeds from the volumetric production payment transactions we closed earlier this year, the proceeds significantly enhance our financial flexibility. By divesting these non-strategic properties, our Canadian team can now focus all of their efforts on increasing the value of our remaining core areas."
Pioneer is retaining its core areas in Canada, the Chinchaga
natural gas and the Horseshoe Canyon coalbed gas fields, where it has
an extensive inventory of drilling locations. The Company recently
completed its largest-ever winter drilling campaign in Canada,
drilling 56 wells. During the summer drilling season, Pioneer plans to
drill up to 100 wells to assess the potential of its extensive
Horseshoe Canyon coalbed acreage position.
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