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EPL Increases Liquidity Through Sale Of Non-Operated Assets For Total Consideration Of $62.3 Million

Stocks in this article: EPL

NEW ORLEANS, March 6, 2013 (GLOBE NEWSWIRE) -- EPL Oil & Gas, Inc. (EPL or the Company) (NYSE:EPL) today announced that it has signed a definitive agreement to sell certain non-operated assets for $51.5 million in cash and the buyer's assumption of liabilities currently recorded on EPL's balance sheet of $10.8 million resulting in total consideration of $62.3 million.


  • Sale of non-operated assets in Bay Marchand (BM) field for total consideration of $62.3 million with EPL retaining its deep rights: $156,000 per flowing barrel, $39/Boe 1P reserves
  • Sale of BM assets has minimal effect on 2013 forecasted record production for EPL. Yearly oil production expected to average between 17,000 to 18,500 Bbls per day
  • 2013 EBITDAX still expected to range between $475 million to $525 million (see discussion of EBITDAX in the appendix)
  • Free cash flow potential is expected to be unchanged at $125 million reflected by projected 2013 EBITDAX and is expected to drive down acquisition revolver debt
  • Substantial liquidity, in the form of cash plus undrawn revolver availability, projected post close of approximately $290 million

Sale of Non-Operated BM Asset

EPL today announced it has executed a purchase and sale agreement to sell certain shallow water Gulf of Mexico (GOM) shelf oil and natural gas interests located within the non-operated BM field area to the well-established property operator for $51.5 million in cash and the buyer's assumption of liabilities currently recorded on EPL's balance sheet of $10.8 million resulting in total consideration of $62.3 million, subject to customary adjustments to reflect the January 1, 2013 economic effective date. The assets are currently producing approximately 400 Boe per day, about 97% of which are oil. Estimated proved reserves as of the January 1, 2013 economic effective date totaled approximately 1.6 million Boe, 90% of which are oil. The total proved divestiture PV10 value is estimated at $53 million using the estimated proved reserves and strip pricing as of year-end 2012 (see discussion of PV10 in appendix).

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