MDU Resources Group Inc., Bismarck, ND, has nearly completed the sale of producing assets of its indirect subsidiary, Fidelity Exploration & Production Co., Denver.
The parent has entered sales agreements for five properties and closed on one of them in October. It expects to close on the others before yearend for aggregate proceeds and associated tax benefits of about $450 million. It didn't identify buyers, all of which, it said, are private exploration and production companies.
MDU Resources is still seeking a buyer for one property representing less than 10% of Fidelity E&P’s production.
The subsidiary had yearend 2014 reserves of 91.9 million boe—48% oil, 44% gas, and 8% NGL. Production in 2014 totaled 9 million boe—54% oil, 39% gas, and 7% NGL.
“Exiting the exploration and production business will allow us to focus more fully on our remaining businesses,” said David L. Goodin, president and chief executive officer of MDU Resources, in the company’s third-quarter earnings statement.
The group’s other businesses are electric and natural gas utilities, pipeline and energy services, and construction. The group’s WBI Energy is a partner with Calumet Specialty Products Partners in the 20,000-b/d Dakota Prairie Refining LLC toppint refinery, which started up in May near Dickinson, ND (OGJ Online, May 4, 2015).