ConocoPhillips said Thursday it has completed two divestitures with undisclosed buyers, including one to sell its large position in the Niobrara formation in the Denver-Julesburg Basin of Colorado.
The world’s largest independent signed an agreement in the fourth quarter to sell the Niobrara interests for $380 million, plus customary adjustments and overriding royalty interests in certain future wells. According to its year-end earnings report, the company had 98,000 net acres in the Niobrara and 14 million boe of reserves associated with the assets.
ConocoPhillips said Thursday that 2019 production from the Niobrara assets was 11,000 boe/d.
The company also completed the sale of its Waddell Ranch properties, conventional oil and gas assets in the Permian Basin, where it holds 167,000 net acres in West Texas and Southeast New Mexico. The Waddell Ranch assets produced 4,000 boe/d last year.
While the company didn’t specifically name the Waddell Ranch assets, it acknowledged in its year-end report with the Securities and Exchange Commission that it entered a deal in January to sell non-core assets in the Lower 48 for $186 million.
The sales come in a line of divestitures in recent years as ConocoPhillips has focused on streamlining its operations and narrowing its global focus. It sold off assets in the UK and Australia last year for more than $3 billion.
While the regulatory climate has become cloudier in Colorado, especially after Senate Bill 181 passed last year giving local governments more control over drilling operations, ConocoPhillips has been primarily focused on its “Big 3” unconventional assets in the United States.
The Lower 48 is the largest production segment. Production from the Bakken and Eagle Ford shales, along with the Permian, hit 387,000 boe/d in the fourth quarter, up from 379,000 boe/d in the year-ago period. Production from those assets increased 22% year/year in 2019.
About 60% of capital expenditures over the next decade, or roughly $4.2 billion/year, is to be dedicated to the Bakken, Eagle Ford, Permian and Montney formation in Western Canada.
The company said Thursday the latest divestitures would not change guidance.