By OGJ editors
HOUSTON, Feb. 26 -- Venoco Inc., Denver, completed the sale of its Hastings complex near Houston to Denbury Resources Inc., Plano, Tex., for $201 million.
"This transaction will allow us to reduce our net debt by $200 million to approximately $600 million," said Tim Marquez, Venoco's chairman and chief executive.
The aggregate purchase price includes $4.9 million for surface land, oil field equipment, and other assets scheduled to close later. Venoco retains a 2% override and a reversionary interest of 25% following payout under the option agreement.
Production from the Hastings complex averaged 2,500 boe/d during 2008, net to the interest sold, with conventional proved reserves of 7.7 million boe. Venco's yearend 2007 reserves for the Hastings complex were 14.4 million boe.
Under the option agreement, Denbury is obligated to complete a carbon dioxide flood of the Hastings complex. However, Denbury has indicated that it does not plan to commence the CO2 flood until 2011 and completion of its Green CO2 pipeline. Venoco has no reserves booked to the CO2 flood or its reversionary interest.
