Carrizo Oil & Gas Inc. has agreed to sell another piece of its portfolio, this time about one-quarter of its net position in the Eagle Ford Shale, to an undisclosed buyer for $245 million.
Houston-based Carrizo said Tuesday it has an agreement to sell about 24,500 net acres in South Texas, which it described as primarily in the downdip area of the volatile oil window of the play. The remaining position in the Eagle Ford, 78,500 net acres, is within the core fairway.
"Our activity in the Eagle Ford Shale is expected to be focused on the updip volatile oil window of the play," said CEO Chip Johnson. "Given this, we believe it made sense to bring the value of these assets forward and use the proceeds to further strengthen our balance sheet by retiring additional debt."
Associated net production from the divestiture averaged 3,400 boe/d in 3Q2017, of which 63% was oil, 19% was natural gas and 18% was natural gas liquids. The assets accounted for less than 10% of Carrizo's total production from the Eagle Ford.
The transaction, subject to adjustment and customary closing terms and conditions, is expected to close by the end of January, with an effective date of Oct. 1.
Carrizo has been paring its portfolio since it launched a divestiture program earlier this year. The program has been especially active since November, with separate deals to unload assets in the Appalachian Basin and the Denver-Julesburg (DJ) Basin. Coupled with the Eagle Ford divestiture, the program has racked up $530 million in asset sales.
Carrizo in late November disclosed it plans to sell substantially all of its DJ assets to an undisclosed buyer for $140 million. On Nov. 15, it sold all of its Utica Shale assets in Guernsey County, OH, to an undisclosed buyer for $62 million. Six days later, it completed a Marcellus Shale sale to a subsidiary of Kalnin Ventures LLC for $84 million.
Excluding a previously received deposit, Carrizo received a combined total of $128 million from the Utica and Marcellus sales.