Denbury Completes Balance of Barnett Shale Sale
Denbury Resources announced that on July 15, 2009 it closed the sale of the remaining balance of its previously announced $270 million sale of 60% of its Barnett Shale natural gas assets. Net proceeds from the second closing were approximately $62.3 million, bringing total net proceeds (after closing adjustments and net of $8.1 million for natural gas swaps transferred in the sale) to approximately $259.8 million. The Company will use the proceeds from the second closing to repay its outstanding bank debt in the near-term, which prior to the second closing was approximately $56.0 million, but ultimately plans to re-invest the sale proceeds in its tertiary operations during 2010.
As part of the second closing, the purchaser acquired the remaining portion of the natural gas swaps to be transferred as part of the sale. In the two closings, the Company transferred to the purchaser aggregate natural gas swaps for 2010 totaling 16 MMcf/d at an average price of approximately $5.65 per MMBtu and natural gas swaps for 2011 totaling 13 MMcf/d at an average price of approximately $6.16 per MMBtu. The net deficit market value of approximately $8.1 million relating to these swaps was deducted from the sales price.
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