Houston's Cabot Oil & Gas Corp., which now is focused on shale exploration, said Tuesday it sold its remaining investment in Canada for $61.3 million.
Earlier this year the company completed the sale of subsidiary Cabot Petroleum Canada Corp. to Tourmaline Oil Corp. In the transaction Cabot received cash and three million shares in the private company. On Tuesday Tourmaline began trading as a public company, which allowed Cabot to sell the shares. Settlement for the new shares was to be completed on Friday.
"This event is timely and enhances our strong balance sheet by turning a previously difficult to market instrument into cash," said Cabot CEO Dan O. Dinges. "With our previously disclosed efforts in the Marcellus and Eagle Ford, along with the current natural gas price outlook, this influx of additional capital is a positive."
The Tourmaline transaction, combined with a sale earlier this month, "provides a capital infusion of over $200 million in the fourth quarter," said the CEO.
Williams Partners LP agreed earlier this month to pay Cabot $150 million for 75 miles of gathering pipelines and two compressor stations in Susquehanna County, PA (see Shale Daily, Nov. 22).
In announcing its 3Q2010 earnings in October, Cabot, whose growth engine is fueled by three shale plays -- the Marcellus, Eagle Ford and Haynesville/Bossier -- said it smashed quarterly production records during the quarter, with output hitting 36 Bcfe, which was a 41% jump year/year (see Shale Daily, Oct. 27). Sequential production also rose 18%, exceeding guidance targets.
During the earnings call, Dinges said despite sustained low gas prices, the Marcellus Shale continues to demonstrate a remarkable ability to compete with gas and/or oil wells in other shale plays.