Memorial Production Partners LP (MEMP) plans to sell some of its noncore assets in the Permian Basin and assets in Colorado and Wyoming to undisclosed buyers.

The Houston-based exploration and production (E&P) company said it will receive $37.4 million for the Permian assets. The Rockies assets will go for $19.1 million in a deal that is expected to close in 3Q2016, with an effective date of April 1, MEMP said. The transactions will be subject to customary post-closing adjustments.

The cash from both deals will go to paying down MEMP’s revolving credit facility, according to the company.

"Driving down costs, generating positive free cash flow and managing MEMP's balance sheet is our key focus this year," said CEO John A. Weinzierl. "The divestiture of noncore properties in the Permian and Rockies is in line with our expectations and consistent with our strategy for 2016. We also expect that the divestiture will enhance cash flow, improve operating efficiencies and better focus the partnership on our remaining core areas."

The Permian assets on the auction block consisted of 285 gross (238 net) producing wells with an output of around 1.2 MBoe/d in 1Q2016. The properties held about 3.1 MMBoe in proved reserves as of Dec. 31, 2015, MEMP said.

The Rockies assets included 606 gross (188 net) producing wells with an output of around 10 MMcfe/d in the first quarter, with estimated proved reserves of 25.5 Bcfe as of year-end 2015.

MEMP operates acreage in East Texas/Louisiana, the Rockies, California, South Texas and the Permian, with a focus on mature, legacy plays. MEMP reported estimated proved reserves of 1,268 Bcfe at year-end 2015.

MEMP got its foot in the door in the Permian and the Rockies in 2013 with a $606 million deal to buy up 973 gross (648.6 net) wells on 363,000 gross (136,000 net) acres in Texas, New Mexico, Wyoming and Colorado (see Shale Daily, July 26, 2013). MEMP followed that up with a $935 million purchase of oil-producing assets in south-central Wyoming in 2014, totaling 6,800 gross (6,800 net) acres and 140 producing wells, as well as 166 injection wells (see Shale Daily, May 5, 2014).