DENVER–(BUSINESS WIRE)–Aug. 1, 2016– SM Energy Company (NYSE: SM) today announced that it has entered into definitive agreements for the sale of two separate packages of non-core assets for a combined price of $172.5 million. The transactions are expected to close late in the third quarter of 2016 with expected cash proceeds subject to customary purchase price adjustments. The closings of these transactions are subject to the satisfaction of customary closing conditions, and there can be no assurance that either of these transactions will close on the expected closing dates or at all.
One package is composed primarily of waterflood assets in New Mexico and the second package includes producing assets in North Dakota and Montana. Year-end 2015 net proved reserves associated with these assets totaled approximately 9.5 MMBoe, 87% oil and 13% natural gas and was all proved developed. Second quarter of 2016 net production from these assets was approximately 3,300 Boe/d and was 82% oil and 18% natural gas. Net acreage associated with these sales is approximately 79,000 acres.
President and Chief Executive Officer Jay Ottoson comments: “These transactions were well-timed and well executed. We are committed to improving liquidity and debt metrics while managing our portfolio to focus on our highest return assets. Proceeds from these sales will be applied to the outstanding balance on our revolving credit facility and for general corporate purposes.”
These property sales make-up the majority of non-core asset sales anticipated during 2016, as announced in February of 2016.
RBC Richardson Barr and UBS Securities LLC advised the Company in the divestiture processes for New Mexico and Williston Basin, respectively.