Williams unloaded more Rocky Mountain reserves Thursday, selling about 8.6 million boe (75% light oil and 25% natural gas) of reserves in the Uinta Basin in Utah to Berry Petroleum for $49 million. Earlier this month Williams sold a much larger chunk of its reserves, 311 Bcfe, to XTO for $400 million (see Daily GPI, April 10).

The company also completed an earn-out provision Thursday associated with the sale of its former Memphis refinery, which added another $24 million to sales proceeds. The reserves and refinery assets sales are part of Williams’ effort to pay down debt, strengthen its balance sheet and improve its liquidity.

The transaction with Berry covers Williams’ Brundage Canyon properties, located in northeastern Utah. The assets consist of 43,500 net acres of producing properties with current production of 2,200 net boe/d of light crude oil and natural gas.

The deal establishes Berry’s first operating position in the Rockies. That was one of the company’s 2003 goals, said Berry CEO Jerry V. Hoffman. It provides the company with “geographic and reserve diversification.

“The Brundage Canyon property has considerable upside potential,” he said. “Our technical personnel have identified numerous additional drilling locations and we may drill up to 26 wells in 2003, depending upon the timing of our close with Williams. Our objective is to build a sizeable portfolio of assets outside of California and to diversify our heavy oil asset base. We believe the Uinta Basin and the surrounding area offers Berry numerous opportunities to achieve this goal through additional acquisitions and/or through the drill bit.”

The effective date of the transaction is April 1. Closing is expected in the third quarter of 2003. Berry Petroleum is a publicly traded independent oil and gas production and exploitation company with headquarters in Bakersfield, CA.

Williams’ earlier sale to XTO included natural gas and coalbed methane producing properties located in the Raton Basin of Colorado, Hugoton Field of southwestern Kansas and the San Juan Basin of New Mexico and Colorado.

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