SM Energy to Sell Portion of Eagle Ford Shale Position
The transaction is subject to customary purchase price adjustments, closing conditions, and transaction fees.
SM Energy said that currently there is no production associated with three wells that have been drilled on the acreage due to limited infrastructure.
The position is a detached block of acreage that is comprised of the entirety of the companyâ€™s operated acreage in LaSalle County, Texas, as well as an immaterial portion of adjacent operated acreage in Dimmit County, Texas.
As of year-end 2010, there was an immaterial amount of proved reserves booked for this acreage.
The buyers will be entitled to approximately 12 percent of the takeaway capacity associated with SM Energyâ€™s agreement with Eagle Ford Gathering, a joint venture between Kinder Morgan Energy Partners, and Copano Energy.
The sale is expected to close in August 2011.
Consistent with prior public statements, SM Energy continues its negotiations on additional potential transactions involving a material portion of its total Eagle Ford shale position in South Texas.
Tony Best, president and CEO of SM Energy, said: â€œI am extremely pleased with this first transaction from our Eagle Ford shale marketing effort. This agreement allows us to realize significant value for a relatively small portion of our total Eagle Ford position.â€
Is this a sensible move from SM Energy?
Have your say and discuss with your peers on the InfoGrok community.
Participate by posting your comments now.
More from New Statesman
- Online writers:
- Steven Baxter
- Rowenna Davis
- David Allen Green
- Mehdi Hasan
- Nelson Jones
- Gavin Kelly
- Helen Lewis
- Laurie Penny
- The V Spot
- Alex Hern
- Martha Gill
- Alan White
- Samira Shackle
- Alex Andreou
- Nicky Woolf in America
- Bim Adewunmi
- Kate Mossman on pop
- Ryan Gilbey on Film
- Martin Robbins
- Rafael Behr
- Eleanor Margolis