Pioneer Natural Resources Co., Dallas, has agreed to sell all of its assets in both the Hugoton field to Linn Energy LLC, Houston, and the Barnett shale to an undisclosed private buyer for total cash proceeds of $495 million.
The Hugoton transaction, effective July 1, involves the exchange of all of PNR’s interests in the field, including 235,000 net acres, its 1,200 producing oil and gas wells, its 51% interest in the Satanta gas processing plant, and other associated infrastructure, to Linn for $340 million.
Linn says it has identified 180 future drilling locations and 150 recompletion opportunities in the assets.
Net production from Hugoton averaged 6,600 boe/d of gas and natural gas liquids during the first half. The deal is expected to close by the end of the third quarter.
Mark E. Ellis, Linn chairman, president, and chief executive officer, commented on the deal: “Following our acquisition from BP in 2012 (OGJ Online, Feb. 28, 2012); this year's announced trade with ExxonMobil (OGJ Online, May 21, 2014); and today’s announcement with [PNR]; Linn will become the largest producer in the field and will have pro forma production in the basin of approximately 275 MMcfed and two natural gas processing plants with capacity of 690 MMcfed.”
The Barnett transaction, effective Aug. 1, involves the exchange of all of PNR’s assets in the play to an undisclosed private company for $155 million.
Net production from Barnett averaged 10,300 boe/d of oil, NGL, and gas during the first half. The transaction also is expected to close by the end of the third quarter.
Scott D. Sheffield, PNR chairman and chief executive officer, commented on both deals: “The sale of these assets will allow us to strategically redeploy capital to our core, oil-related Spraberry-Wolfcamp assets in the Permian basin of West Texas where we are successfully transforming the substantial resource potential we delineated in 2013 into strong production growth.”