By OGJ editors
HOUSTON, Oct. 19 -- Denbury Resources Inc. agreed to sell its Louisiana natural gas assets for $180 million to a privately owned company, which it did not identify. The sale includes Denbuy's interest in a producing South Chauvin well. If operating income from that well exceeds certain levels, then the company says the divestiture's final sales price could increase by as much as 10%.
Production attributable to all properties being sold averaged 28.8 MMcfd of gas equivalent (85% natural gas) during the second quarter, representing 11% of Denbury's total production. The properties accounted for 4% of Denbury's total proved reserves as of Dec. 31, 2006.
The sale is expected to close in 30-45 days and is subject to satisfactory completion of customary due diligence.
A Mississippi independent, Denbury owns large reserves of carbon dioxide used for tertiary oil recovery east of the Mississippi River. Denbury also holds acreage in the Barnett shale play near Fort Worth, Tex., and properties in southeast Texas.