Dallas-based Pioneer Natural Resources Co. said Pioneer Southwest Energy Partners LP made a regulatory filing Thursday for its initial public (IPO) offering of common units in a master limited partnership (MLP) to hold exploration and production assets in West Texas.
Pioneer Southwest anticipates offering 12,500,000 common units representing a 44.4% limited partner interest in Pioneer Southwest Energy. Upon completion of this offering, Pioneer will own a 0.1% general partner interest and a 55.5% limited partner interest in Pioneer Southwest. The underwriters are expected to be granted a 30-day option to purchase up to 1,875,000 additional common units. Pioneer’s limited partner interest would be reduced to 52% if the underwriters exercise their over-allotment option in full. Pioneer Southwest Energy intends to apply to have its common units listed on the New York Stock Exchange under the ticker PSE.
Assuming an IPO price of $20/unit and that the underwriters do not exercise their over-allotment option, estimated gross proceeds from the offering would be $250 million.
Pioneer Southwest is a Delaware limited partnership formed by Pioneer to own producing oil and gas properties in the Spraberry field in the Permian Basin of West Texas, and to acquire producing oil and gas properties in its area of operations. This area includes onshore Texas (excluding 20 counties in the Texas Panhandle) and eight counties in the southeast region of New Mexico. Pioneer Southwest Energy will have interests in producing wells that had estimated proved reserves of 25 MMboe as of Dec. 31, 2006 and average production of 4,611 boe/d during 2006.
The partnership filed a registration statement on Form S-1 with the Securities and Exchange Commission. In April Pioneer said would spin off two MLPs, one to hold its Spraberry assets, the other to hold its Raton Basin properties in southern Colorado. The Raton Basin partnership will spin off in 2008 (see Daily GPI, April 24).
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