Concho Resources Inc. (NYSE: CXO) ("Concho" or the "Company") today announced that it has closed its previously announced divestiture of certain non-core producing properties located primarily in the Permian Basin of West Texas and Southeast New Mexico to Legacy Reserves LP (NASDAQ: LGCY) for cash consideration of approximately $520 million, subject to customary post-closing adjustments.
Proceeds from the non-core divestiture will be used to reduce outstanding borrowings under the Company’s credit facility. Giving effect to these proceeds, the Company’s pro forma outstanding borrowings under its credit facility as of September 30, 2012 would have been $284 million.
Tim Leach, Concho's Chairman, CEO and President, commented, “This non-core asset divestiture completes our financing strategy for the Three Rivers acquisition and represents good value for mature, producing assets. Going forward, we are well positioned to execute our growth strategy targeting a deeper inventory of high rate-of-return drilling opportunities in the Delaware Basin, New Mexico Shelf and Midland Basin.”
About Concho Resources Inc.Concho Resources Inc. is an independent oil and natural gas company engaged in the acquisition, development and exploration of oil and natural gas properties. The Company's operations are focused in the Permian Basin of Southeast New Mexico and West Texas. For more information, visit Concho’s website at www.concho.com. Forward-Looking Statements and Cautionary Statements The foregoing contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically include statements, estimates and projections regarding the Company’s anticipated financial condition and results, future production, and future liquidity These statements are based on certain assumptions made by the Company based on management's experience, expectations and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Forward-looking statements are not guarantees of performance. Although the Company believes the expectations reflected in its forward-looking statements are reasonable and are based on reasonable assumptions, no assurance can be given that these assumptions are accurate or that any of these expectations will be achieved (in full or at all) or will prove to have been correct. Moreover, such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. Any forward-looking statement speaks only as of the date on which such statement is made, and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.