Exploration and production company Noble Energy has signed an agreement to divest around 30,200 net acres from its non-core DJ Basin position in Weld County, Colorado, US, to SRC Energy for $608m.
The asset sale under consideration comprises about 4,100 barrels of oil equivalent per day (boepd).
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Around half of the acreage is located in the company’s Greeley Crescent area, while the remaining holding is in the Bronco area.
Noble Energy Operations executive vice-president Gary Willingham said: “This sale of acreage in our Greeley Crescent and Bronco development areas represents an acceleration of value as it was not likely to be developed by us for a number of years.
“Our DJ Basin activities, both now and for several years to come, will remain focused on the northern and eastern parts of the basin.
“This is where we have a deep inventory of long lateral drilling opportunities in an oilier part of the basin and where our infrastructure provides a competitive advantage.”
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By GlobalDataThe proceeds from the sale will be used to further strengthen the company’s investment-grade balance sheet.
The acreage dedication is maintained by Noble Midstream Partners for in-basin oil gathering, produced water gathering and fresh water delivery.
Total non-operated production associated with the asset sale is around 2,500boepd.
Meanwhile, operated production is anticipated to be 1,600boepd.
The sale of acreage and production represents around 8% and 4% respectively of the company’s totals in the DJ Basin.
Once the transaction is closed, Noble Energy’s position in the DJ Basin will stand at about 335,000 net acres.
Under the agreement, the transaction is expected to take place in two phases.
Initially, acreage and non-operated production will be divested by the end of the year.
The second phase includes the sale of operated producing properties by mid-2018.
Completion of the transaction is subject to customary terms and conditions.
