Carrizo signs agreement to sell Eagle Ford assets for $245m

Carrizo Oil & Gas has signed an agreement to sell a portion of its assets in the Eagle Ford Shale, US, for $245m.

The assets for sale consideration include around 24,500 net acres, located primarily in the downdip area of the volatile oil window.

During the third quarter of this year, the assets had associated net production of about 3,400boed.

The latest transaction is in line with the company’s strategy to divest non-core assets to strengthen the balance sheet.

Carrizo Oil & Gas president and CEO Chip Johnson said: “Our activity in the Eagle Ford Shale is expected to be focused on the updip volatile oil window of the play.

“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.

“Combined with our previously announced, non-core divestitures, this transaction brings the total announced proceeds from our divestiture programme to approximately $530m.”

In terms of production, the divestiture accounts for less than 10% of the company’s total in the Eagle Ford Shale.

Upon the completion of the transaction, Carrizo will hold around 78,500 net acres in the Eagle Ford Shale, exclusively located within the core volatile oil fairway.

The transaction is scheduled to be completed by the end of January next year.

Carrizo also has operations in the Permian Basin in West Texas.