Shell to sell Eagle Ford acreage to Sanchez Energy for $639 million
HOUSTON -- Shell announced May 21 that it has agreed to sell its 100% working interest in approximately 106,000 net acres in Dimmit, LaSalle and Webb Counties, Texas, to Sanchez Energy Corporation for approximately $639 million, subject to closing.
The sale includes approximately 176 operated producing wells, and associated field facilities and infrastructure. Net production in first-quarter 2014 was approximately 24,000 boed, with approximately 60% crude and natural gas liquids. The acreage holds 60 MMboe of total proved reserves.
The agreement is effective Jan.1, and is expected to close at the end of the second quarter of this year.
Shell said that the transaction is part of the restructuring of its North Americas resources plays (shale oil and gas) portfolio, to focus on acreage positions that can reach the scale required by the company. In addition to this sale, Shell previously divested its acreage position in the Mississippi Lime in Kansas, its Utica shale position in Ohio, and a portion of its acreage in the Sandwash Niobrara basins in Colorado as part of this strategy.
For Sanchez Energy, the additional acreage is expected to bring the company’s total position in the Eagle Ford to approximately 226,000 acres, with up to 3,000 potential drilling locations and average first-quarter 2014 pro forma production of approximately 42,800 boed, according to the buyer.