Penn Virginia (PVA) Announces $100M Appalachian Asset Sale

July 17, 2012 9:05 AM EDT
Penn Virginia Corporation (NYSE: PVA) has entered into a definitive agreement to sell substantially all of its Appalachian assets, with the exception of the Marcellus Shale, to an undisclosed buyer for gross cash proceeds of $100 million. This sale is expected to close before mid-August and is subject to customary purchase price adjustments and other customary closing conditions. The effective date of the sale is January 1, 2012. We intend to use the net proceeds from this sale to help fund our 2012 capital expenditure plan.

The properties to be sold include vertical and horizontal coalbed methane and conventional properties, as well as royalty interests. The properties had net production of approximately 20 million cubic feet of natural gas equivalent per day during June 2012, almost 100 percent of which was natural gas. As a result of the divestiture, our 2012 production will decrease by an estimated 2.9 billion cubic feet of natural gas equivalent (Bcfe). Estimated proved reserves associated with the divested properties, as determined by our third party engineers at year-end 2011, were 105.7 Bcfe, 96 percent of which were proved developed and 100 percent of which were natural gas.

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