DENVER, July 24, 2017 (GLOBE NEWSWIRE) — QEP Resources, Inc. (NYSE:QEP) (“QEP” or the “Company”) announced today that its wholly owned subsidiary, QEP Energy Company, has entered into two definitive agreements to sell natural gas assets in southwest Wyoming for combined proceeds of $777.5 million, subject to customary purchase price adjustments (the “Divestitures”).
“Our Wyoming assets have been significant contributors to the company for many years and were critical to our early success,” commented Chuck Stanley, Chairman, President and CEO of QEP. “As we continue to evolve as a company, these transactions are a necessary next step in simplifying our asset portfolio and delivering significant financial proceeds that will further strengthen our balance sheet and help fund future development projects and acquisition opportunities.”
The first agreement provides for the sale of all of QEP’s assets in the Pinedale Anticline field in Sublette County, Wyoming, for a purchase price of $740.0 million (“Pinedale Divestiture”) to Pinedale Energy Partners, LLC, an affiliate of Oak Ridge Natural Resources, LLC. The Pinedale Divestiture includes an estimated 964 Bcfe of proved reserves as of December 31, 2016, and net production in the first quarter of 2017 was 234 MMcfed, of which approximately 12% was liquids. As part of the Pinedale Divestiture, QEP has agreed to reimburse the buyer for certain deficiency charges it incurs related to gas processing and NGL transportation and fractionation contracts, if any, between the effective date of the sale and December 31, 2019, in an aggregate amount not to exceed $45.0 million. The transaction is subject to closing conditions, including regulatory approval, and is expected to close by September 30, 2017.
BMO Capital Markets served as financial advisor and Vinson & Elkins LLP provided legal counsel to QEP. Wells Fargo Securities, LLC served as financial advisor and Baker Botts L.L.P. provided legal counsel to Pinedale Energy Partners, LLC.
In a separate transaction, the Company closed the sale of certain non-core natural gas assets in southern Wyoming to an undisclosed buyer on June 30, 2017. The purchase price was $37.5 million. The divestiture includes an estimated 15.2 Bcfe of proved reserves as of December 31, 2016, and net production in the first quarter of 2017 was approximately 4 MMcfed, of which approximately 2% was liquids.
About QEP Resources
QEP Resources, Inc. (NYSE:QEP) is an independent natural gas and crude oil exploration and production company focused in two geographic regions: the Northern Region (primarily Wyoming, North Dakota and Utah) and the Southern Region (primarily Texas and Louisiana) of the United States.