SandRidge (SD) to Sell Permian Basin Assets in $2.6B Deal
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SandRidge Energy, Inc. (NYSE: SD) today announced that it has signed a definitive agreement to sell its Permian Basin properties to Sheridan Production Partners II, a privately held Houston-based oil and gas company, for $2.6 billion in cash. SandRidge announced on November 8 that it was exploring the sale of the assets.
Noting that the Permian Basin assets were a key part of SandRidge's planned strategic transition from a natural gas producer to an oil rich E&P company, Ward added, "With these proceeds we will have a cash balance of almost $3 billion and liquidity of over $3.5 billion, which we intend to use to reduce debt and strengthen the balance sheet. This will also allow us to fund development of our acreage position as well as future opportunities in the highly scalable, high return Mississippian Play."
The Permian properties being sold were producing approximately 24,500 Boe per day at the end of the third quarter (67% oil, 15% NGLs and 18% natural gas) and exclude assets associated with SandRidge Permian Trust (NYSE: PER).
The transaction is expected to close during the first quarter of 2013, subject to customary closing conditions, and will have an effective date of January 1, 2013. Additionally, revised 2013 operational guidance for SandRidge will be issued upon the closing of the sale. RBC Richardson Barr and Morgan Stanley & Co. LLC acted as financial advisors to the Company in connection with the transaction. The buyer of the assets, Sheridan Production Partners II, is the second series of Sheridan funds established for the management and ongoing development of mature producing oil and gas properties.
Noting that the Permian Basin assets were a key part of SandRidge's planned strategic transition from a natural gas producer to an oil rich E&P company, Ward added, "With these proceeds we will have a cash balance of almost $3 billion and liquidity of over $3.5 billion, which we intend to use to reduce debt and strengthen the balance sheet. This will also allow us to fund development of our acreage position as well as future opportunities in the highly scalable, high return Mississippian Play."
The Permian properties being sold were producing approximately 24,500 Boe per day at the end of the third quarter (67% oil, 15% NGLs and 18% natural gas) and exclude assets associated with SandRidge Permian Trust (NYSE: PER).
The transaction is expected to close during the first quarter of 2013, subject to customary closing conditions, and will have an effective date of January 1, 2013. Additionally, revised 2013 operational guidance for SandRidge will be issued upon the closing of the sale. RBC Richardson Barr and Morgan Stanley & Co. LLC acted as financial advisors to the Company in connection with the transaction. The buyer of the assets, Sheridan Production Partners II, is the second series of Sheridan funds established for the management and ongoing development of mature producing oil and gas properties.
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