Abraxas Petroleum Corporation (NASDAQ:AXAS) is pleased to announce the execution of a definitive agreement to sell the company’s Eagle Ford interests at WyCross in McMullen County, Texas for $73 million.
Abraxas recently executed a definitive agreement to sell the company’s Eagle Ford interests at WyCross in McMullen County, Texas to an undisclosed buyer for $73 million. The sale is subject to customary closing conditions and purchase price adjustments and reflects an effective date of December 1, 2013. The assets to be sold consist of approximately 1,200 net acres, 3.7 million barrels of proved reserves
(2.8 million barrels of oil, 3.0 billion cubic feet of gas and 0.5 million barrels of NGLS) and produced 655 boepd (597 barrels of oil per day, 154 million cubic feet of gas per day and 32 barrels of NGLs per day) net to Abraxas during the month of September 2013. Abraxas plans to use the proceeds from this sale to immediately pay down the company’s bank line, before being ultimately redeployed into additional operated lease blocks in the Eagle Ford and Bakken. Closing is scheduled for December 2013.
With the removal of the WyCross production volumes and two additional WyCross well completions in 2013, Abraxas is revising its 2013 production and exit rate guidance. Abraxas now expects 2013 production to average 4,300-4,350 boepd with an exit rate of approximately 4,500 boepd.
Bob Watson, President and CEO of Abraxas, commented, “Abraxas continues to focus the company’s portfolio on high quality, operated assets with a high working interest. Although the WyCross properties were certainly of the highest quality, they carried a low working interest and are now non-operated. We continue to identify additional lease blocks available in our targeted regions of the Eagle Ford and expect to be in a position to announce additional Eagle Ford acreage acquisitions in the near future.