Pioneer Natural Resources has reportedly launched the divestment of its assets in the Delaware basin in Texas, US, to secure more than $2bn.
Two sources familiar with the matter told Reuters that the sale forms part of the company’s efforts to streamline its business.
The assets considered for sale were acquired by Pioneer from Parsley Energy, according to the sources.
With the sale, Pioneer intends to focus on its assets located in the mid-land portion of the greater Permian Basin in the US and reduce its debt following two acquisitions this year.
During the second quarter ending 30 June 2021, the firm’s net debt stood at $6.8bn.
In March 2021, Pioneer divested an oilfield services business for an undisclosed amount.
As part of the assets sale plan, Pioneer Natural Resources has agreed to divest its approximately 20,000 net acres in western Glasscock County in Texas to Laredo Petroleum for approximately $230m.
The acquisition of assets located directly adjacent to Laredo’s existing western Glasscock leasehold is a part of Laredo’s effort to boost high-margin, oil-weighted inventory by 50%.
The purchase expands the firm’s oil-weighted core development area in the prolific Midland Basin.
Subject to customary closing price adjustments, the deal is planned to be closed in October 2021.
Upon completion of the deal, Laredo will hold approximately 22,200 net acres of the core development area in western Glasscock County.
Laredo president and CEO Jason Pigott said: “Upon closing this transaction, we will have acquired more than 55,000 net acres of highly productive, oil-weighted inventory in Howard and western Glasscock counties in just two years, fundamentally transforming Laredo.
“Seven years of inventory across these core areas will enhance our ability to deliver sustainable, long-term Free Cash Flow generation and to rapidly deleverage.”