Vanguard Natural Resources Inc., Houston, has agreed to sell certain assets in the Arkoma and DJ basins to an undisclosed buyer for $14.5 million as part of the company’s ongoing transition from upstream MLP to independent exploration and production company.
With the sale of both operated and non-operated natural gas properties in Arkoma currently producing 8 MMcfd, the company is exiting the state of Arkansas. In Colorado, the company is letting go of five producing wells and associated undeveloped acreage in the DJ basin in Weld County. Closing is expected to occur in early fourth quarter.
The year has been about “transitioning Vanguard from an upstream MLP to a successful [E&P] company focused on organic growth,” by divesting noncore assets, said Vanguard Pres. and Chief Executive Officer R. Scott Sloan, while reporting second-quarter financials on Aug. 13. Sloan was appointed executive vice-president and chief financial officer in September 2017 after the company completed its financial restructuring and emerged from Chapter 11. He was promoted to president and CEO in January.
During 2018, Vanguard completed the sale of certain oil and gas properties in the Permian basin, the Green River basin, and in Mississippi for an aggregate selling price of $59.9 million. Since June 30, the company closed three additional divestitures for aggregate proceeds of $28.4 million, including its Potato Hills assets in the Arkoma basin for gross proceeds of $22.9 million and interests in over 145 wells in multiple counties in Texas and Louisiana for gross proceeds of $5.5 million.
For the first half of this year, Vanguard reported average production of 365 MMcfed compared with 381 MMcfed during the same period in 2017—a 4% decrease attributed primarily to the divestitures completed during 2017 and 2018.
Currently, the company is marketing its Greater East Haynesville divestment package. Assets include certain oil and gas properties in East Texas and North Louisiana comprised of operated and non-operated working interests with current production of 2,500 boe/d and associated development rights.
Other noncore asset sale processes are continuing, and additional assets are being preparing for potential divestment, the company said.
Contact Mikaila Adams at [email protected].