Antero Resources Corp. has sold a portion of its future Appalachian natural gas production to an affiliate of J.P. Morgan for $220 million as part of a broader effort announced last year to sell more assets and cut debt.
The volumetric production payment (VPP) completed with the bank is effective July 1 and will cover a seven-year term ending June 30, 2027. Under the deal, production sold to J.P. Morgan from the company’s dry gas properties in West Virginia includes 60 MMcf/d in the second half of 2020 and 75 MMcf/d in 2021. Volumes under the VPP then decline to 40 MMcf/d by the first half of 2027.
Antero also said it would repurchase all of its 2021 senior notes and a portion of its 2022 and 2023 senior notes for up to $525 million. The cash tender offer, along with the VPP, will allow the company to address its November 2021 senior note maturity.
Assuming the bonds are tendered and repurchased, CFO Glen Warren said the company has reduced near-term bond maturities by more than $1.4 billion since 4Q2019.
The company implemented an asset sale target of $750 million to $1 billion late last year to help reduce debt. Antero has so far sold $751 million of assets since then. The other transactions included the sale of $100 million of Antero Midstream common stock, a $402 million overriding royalty interest sale and a $29 million hedge monetization.
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