Forest Oil to sell Permian basin assets

By OGJ editors
-- Forest Oil Corp. of Denver agreed to sell its remaining Permian basin properties for $800 million to SandRidge Exploration & Production LLC.

Closing is expected by Dec. 31 with an effective date of Nov. 1 for the West Texas and New Mexico properties.

The properties produce 46 MMcfd of gas equivalent. Forest reported the properties had estimated proved reserves of 321 bcf, of which 7% was developed, as of Dec. 31, 2008.

Separately, Forest agreed to sell its noncore, primarily nonoperated assets in Alberta’s Deep basin for $38 million.

This transaction, which is expected to close in December, will bring Forest's noncore Canadian property divestitures in 2009 to $100 million. After closing, Forest will have accomplished 50% of its noncore Canadian divestiture goal.

Forest intends to finish selling its noncore Canadian properties in early 2010 to streamline its assets and to prepare for more active development programs in 2010-11.

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