Range Resources Corp. said late Wednesday that it closed a deal to sell its coalbed methane assets in Virginia's Nora Field, receiving $865 million in proceeds -- $11 million less than what it announced when the company entered the agreement in November.
After transaction costs and what Range said were purchase price adjustments based on a Nov. 1 effective date, the original $876 million sales price was cut (see Shale Daily, Nov. 4, 2015). Range sold the assets to EnerVest Ltd.
The assets, along with others in Northeast Pennsylvania and the Midcontinent, were idled earlier this year on low oil and gas prices. Management said on its 3Q15 earnings call that the company would look to complete at least one noncore asset sale by the end of 2015 (see Shale Daily, Oct. 29, 2015). Bank of America is also currently marketing the company's STACK (Sooner Trend, Anadarko basin, Canadian and Kingfisher counties) acreage in Oklahoma, which includes multiple horizons, according to Range's latest investor presentation.
The company said it would include Nora results in its fourth quarter earnings report. The properties sold include 3,500 operated wells across 460,000 net acres in the Nora/Hasi fields located in Southwestern Virginia. They produced 109 MMcf/d in 3Q2015, accounting for 7.5% of the company's overall production.
While the sale boosts the company's liquidity to about $1.7 billion, it had $3.6 billion in outstanding net debt at the end of 3Q2015. Net proceeds, however, were used to reduce that figure by 24%. The company has not yet announced its capital expenditures budget for 2016.
The Nora sale, Range said, is also expected to reduce operating expenses, brokerage natural gas and marketing expenses, and general and administrative expenses in 2016.